The Veterinary CEO

Author: Adam Miller, DVM

  • Buying Your First Practice: A Step-by-Step Guide

    I’ve been on both sides of a practice sale. The buyers who do well aren’t the ones with the most money. They’re the ones who prepared, put good advisors around them and knew what they were looking at. Here’s the process, in order.

    Step 1: Be honest about whether you’re ready

    Before you look at a single practice, answer three questions:

    • Clinically: Can you run the medicine without a safety net?
    • Financially: Is your credit solid, and do you have savings and a debt load you can manage?
    • Personally: Do you want to lead people and manage money, or do you just want to practice medicine?

    Step 2: Build your advisory team

    You need three people before you need a practice:

    • A CPA who knows veterinary practices. They’ll read the financials and tell you what’s real.
    • An attorney who handles practice transactions. Purchase agreements, leases and non-competes are where buyers get hurt.
    • A lender who specializes in veterinary or healthcare practices. They’ve seen a lot of deals and know what a healthy practice looks like.

    Ask owners you trust who they used. Good advisors pay for themselves many times over.

    Step 3: Get lender-ready

    Practice lenders will want to see:

    • A clean personal credit report. Check all three bureaus and fix errors early.
    • A business plan and financial projections for the practice.
    • Proof you can handle the debt you already have, student loans included.
    • Sometimes, life and disability insurance. Underwriting for those can take 4 to 6 weeks, so start early.

    How much cash do you need? Usually less than people assume. Some lenders that focus on veterinary practices offer up to 100% financing for strong buyers purchasing healthy practices. SBA 7(a) loans can also be used to buy a practice, up to the program’s $5 million cap. Terms vary by lender and change over time, so apply to more than one and compare.

    Step 4: Find the right practice

    The best deals often never hit the open market. Owners planning to retire often want to sell to someone they know and trust. So:

    • Tell owners in your area you’re interested in owning.
    • Ask your current owner whether a buy-in is possible.
    • Talk to brokers and practice-sales specialists.
    • Use peer networks, study groups and veterinary associations.

    Keep this in mind: in one survey of owners who sold to corporations, 71% said they would rather have sold to an associate. Plenty of owners are looking for someone like you. They just don’t know who you are yet.

    Step 5: Evaluate the practice

    With your CPA, go through at least three years of financials and the practice’s key numbers:

    • Revenue trend. Growing, flat or shrinking?
    • Active and new clients. Is the client base healthy?
    • Average transaction. How does it compare with similar practices?
    • Labor and cost of goods as a percent of revenue. These are the biggest expenses you can control.
    • The owner’s production. How much revenue walks out the door if the seller leaves?

    These overlap a lot with the 7 numbers I track every month at my own hospitals, so that post is a good way to learn what healthy looks like. Then look past the spreadsheet: the team, the facility and equipment, the lease or real estate, and the local competition.

    Step 6: Agree on value and terms

    A practice’s value is usually based on its profitability, adjusted for the owner’s salary and one-time expenses. Get an independent valuation. Corporate buyers can pay prices an individual buyer’s lender won’t support, so don’t let a corporate number become your benchmark.

    Terms matter as much as price. Negotiate how long the seller stays to help transition clients and staff, the non-compete, what’s included (equipment, inventory, receivables) and whether you’re buying or leasing the building.

    Step 7: Due diligence and closing

    This is where your attorney and CPA earn their fees. Verify the financials, review contracts and leases, check licenses and inspections, and confirm which liabilities stay with the seller. Then sign, fund and close.

    Step 8: Your first months as owner

    Meet the team before you change anything. Tell clients about the transition warmly and clearly, ideally with the seller next to you. Watch cash flow every week. Your first job is keeping what already works. Improvements come after you’ve earned some trust.

    Other ways in

    Buying a whole practice isn’t the only way in. A buy-in lets you purchase part of a practice over time as a partner. A start-up means building from scratch, with more risk and more control. I’ll cover both in a separate article.

    Sources

  • The Student & New-Grad Roadmap to Ownership

    Most vets who end up owning a practice didn’t plan it in school. They fell into it when an owner asked, “Would you ever want to buy in?” Some were ready. A lot weren’t.

    You can do better than that. You don’t have to know today whether you’ll own. You just have to keep the door open. Here’s how, stage by stage.

    In vet school: build the foundation

    Join VBMA. The Veterinary Business Management Association has student chapters at many vet schools, and its Business Certificate Program covers finance, operations, management and ownership. Texas A&M’s chapter says more than two-thirds of the required hours apply to every student, not just future owners. It’s the cheapest business education you’ll ever get.

    Learn to read a P&L. You don’t need an MBA. You need to know what revenue, cost of goods, labor cost and profit mean in a practice, and why they matter. Ask an owner to walk you through theirs during an externship. Most owners I know would say yes.

    Watch your debt. Preliminary numbers from AVMA’s 2026 senior survey put average debt at about $185,000 across all graduates, and about $228,000 for those who borrowed. Every dollar you don’t borrow is a dollar you can put toward a practice later. Federal loan rules changed recently, so check current options at studentaid.gov, or with a loan advisor who works with vets, before you graduate.

    Notice how practices run. On rotations and externships, pay attention to what makes a practice a good place to work: scheduling, culture, how the owner talks to the team. You’re building a picture of the practice you’d want to run.

    Your first job: pick a teacher, not just a salary

    Full-time new grads averaged about $132,000 in starting pay in AVMA’s preliminary 2026 data. Offers vary, and it’s tempting to grab the biggest number. If ownership might be in your future, weigh one more thing: will this employer teach you the business?

    Questions to ask in interviews:

    • Does the owner share practice numbers with associates?
    • Has an associate here ever bought in or become a partner?
    • Is there mentorship beyond clinical skills?
    • Would the owner consider selling to an associate someday?

    A practice that says yes to a few of these is worth more to your future than a few thousand dollars in salary.

    Years 1 to 3: get confident clinically and ready financially

    Get good at medicine first. Clients and staff trust confident doctors. Ownership is a lot harder if you’re still finding your clinical footing.

    Get your financial house in order.

    • Choose a student loan repayment plan on purpose, not by default.
    • Build an emergency fund that covers several months of expenses.
    • Protect your credit score. Lenders will check it.
    • Skip big new debt, like an expensive car, that hurts your debt-to-income ratio.

    Know your own production numbers. Know your revenue per day, your average transaction and how your pay is calculated. If you’re paid on production, you’re already learning to think like an owner. When you’re ready for the bigger picture, here are the 7 numbers owners should track every month.

    Build your network. Get to know owners in your area, including ones who aren’t your boss. A lot of owners would rather sell to a vet than to a corporation, but they have to know you exist.

    Around year 3: decide if you’re in

    By now you’ll have a feel for whether ownership excites you or wears you out. Be honest with yourself. If you’re in, your next read is Buying Your First Practice.

    If you’re not, that’s fine too. You’ll be a better associate for understanding the business, and the door stays open.

    Sources

  • Why Practice Ownership Still Pays

    If you’re a young vet, you’ve probably heard some version of this: ownership is dead, the corporations bought everything, and the smart move is to take a good salary and stay out of the business side.

    I don’t buy it. I’ve been an associate, a partner, a seller and a buyer, and I own two hospitals today. Here’s what the numbers say, including the parts that don’t flatter owners.

    Owners still earn more

    AVMA’s 2025 economic report, which covers 2023 income, has owners of companion-animal-only practices averaging $191,352. Associates in the same type of practice averaged $146,196. That’s a gap of about $45,000 a year. The medians are closer, $160,000 vs. $133,000, but that’s still $27,000.

    And it isn’t just small-animal. Owners out-earned associates in every private practice category AVMA reported: companion animal, mixed animal, equine and food animal.

    Now the honest caveat. In AVMA’s census, owners averaged about 24 years of experience and associates about 13.5. Some of that income gap is seniority, not ownership. But the pattern shows up in every category, and it isn’t small.

    The paycheck is only half the story

    An associate’s income stops when they stop working. An owner’s doesn’t have to. When you own a practice, you’re building something you can sell, bring a partner into, or keep earning from when you step back.

    That’s hard to see at 30 and obvious at 60. A lot of the owners selling today are cashing in decades of equity. That option only exists if you owned something.

    The real costs

    Ownership isn’t free, and anyone who tells you it is wants something from you.

    • More hours. AVMA’s census has owners at 47.2 hours a week, vs. 40.9 for associates.
    • Debt and risk. You’ll probably borrow to buy, and that loan is yours in good years and bad ones.
    • A second job. Payroll, hiring, conflict, marketing, cash flow. If you hate all of that, you’ll need a strong practice manager and the humility to let them run with it.

    Fewer owners means more opportunity

    The share of vets who own their practice keeps shrinking. AVMA’s 2024 census put owners at 23.8% of private-practice veterinarians. A 2025 paper in Frontiers in Veterinary Science estimates that corporations own about 25% of primary care practices and about 75% of specialty and emergency practices.

    That sounds like bad news if you want to own someday. I think it’s the opposite.

    The same paper cites a Veterinary Management Groups survey of owners who sold to corporations. 71% said they would have preferred to sell to an associate. And when asked why they didn’t, 59% said the associate couldn’t afford it.

    Read that again. Owners want to sell to you. What’s in the way is preparation and money, and you can solve both with time, a plan and the right lender.

    The paper also notes that about 55% of associates said they’d rather work in independent practice. Plenty of vets want independence. Far fewer have a plan to get it.

    So should you own?

    Not necessarily. If you want predictable hours and no business headaches, being a great associate is a great career.

    But if you want to set the standard of medicine, build a team you’re proud of and own the value you create, ownership is still the best path this profession offers. It just takes more preparation than it used to.

    That’s what this section of the site is for. Pick your path: the student and new-grad roadmap, or the associate’s guide to buying your first practice.

    Sources

  • The 7 Numbers Every Practice Owner Should Track Every Month

    Most practice owners I talk to get a P&L from their accountant weeks after the month closes, glance at the bottom line, and go back to seeing appointments. By the time a problem shows up there, it has usually been costing you money for a quarter or more.

    You don’t need forty KPIs. You need a short list you look at every single month, in the same format, so you can see the trend before it becomes a crisis. Here are the seven I’d put on that list, how to calculate each one, and what to do when one moves.

    Numbers 1–3: Is money coming in, and is it staying?

    1. Gross revenue, compared with the same month last year. Month-over-month comparisons fool you because of seasonality, so compare each month with the same month a year ago. Today’s Veterinary Business columnists Jason Castner and Robert Sparrow put a simple floor on it: if revenue isn’t growing at least 3% a year, something needs attention. With inflation in the mix, flat revenue means you’re shrinking.

    2. Cost of goods sold as a percent of revenue. COGS % = (drugs, supplies, lab and other direct costs) ÷ gross revenue. A dvm360 article on COGS puts the target for a general hospital at or below 23% to 27%, depending on your service mix, and treats a number approaching 30% as a warning sign. I wrote a whole post on reading your COGS, so I won’t repeat it here. The point for this list: watch it monthly, because inventory leaks don’t wait for year-end.

    3. Support-staff payroll as a percent of revenue. Staff payroll % = non-DVM gross wages ÷ gross revenue. Castner and Sparrow suggest a useful combined check: when COGS plus non-DVM payroll exceeds 45% of revenue, look hard at both. These two lines are where most of the money goes after doctor pay, and they’re the two you control most directly.

    Numbers 4–5: Are your doctors and visits productive?

    4. Production per doctor, and doctor pay as a percent of production. Pull each doctor’s monthly production from your practice software. Then divide what you pay each doctor by what they produced. My benchmark is 17% to 20% of production. For context, a long-running dvm360 guide to ProSal puts typical associate pay at 18% to 25%. This isn’t about squeezing anyone. It’s about knowing whether doctor pay and doctor production are moving together. When that percentage creeps up, the fix is rarely the doctor’s paycheck. It’s usually how the doctor’s day is being spent.

    Make sure your doctors are doing doctor things: diagnosing, prescribing and performing surgery. Everything else (restraint, history, blood draws, radiographs, client education, callbacks) belongs to a well-trained team. A doctor who isn’t using their team is doing team-level work at a doctor’s cost, and production per doctor will show it. AVMA’s analysis of gross revenue per veterinarian points to an optimum of about 4 to 5 support staff per doctor, including about one credentialed technician per doctor. If your doctors are short on help, or not leaning on the help they have, start there.

    5. Average client transaction (ACT) and invoice count. ACT = gross revenue ÷ number of client invoices. Always look at it next to the invoice count, because revenue is just those two multiplied together. Revenue up because ACT rose while invoices fell is a very different month from revenue up because more clients came through the door. One tells you prices or service mix changed; the other tells you demand did.

    Number 6: Is your client base growing?

    6. Active clients, new clients, and bonding rate. The benchmark studies Dr. Karen Felsted describes in Today’s Veterinary Business define an active client as one with at least one transaction in the last 12 months. Track three things:

    • Active clients (rolling 12 months). Is the base growing or shrinking?
    • New clients per month. This is the fuel. If it’s falling, your marketing, phones, or online reviews deserve a look.
    • Bonding rate: of the clients you saw last year, what share came back this year? Felsted’s example: if 68% of last year’s clients returned, 32% lapsed. That lapsed group is your cheapest growth opportunity, because they already know you.

    Define these once and lock the definition. If your software counts “active” differently than last year, your trend line is worthless.

    Number 7: What’s left over?

    7. EBITDA (earnings before interest, taxes, depreciation and amortization). Start with net income, then add back interest, taxes, depreciation and amortization. Many owners also normalize it by adjusting their own pay to a market-rate doctor salary, which is how a buyer will look at it. Castner, writing in Today’s Veterinary Business, calls more than 20% excellent. Treat that as one experienced CPA’s yardstick, not a survey average. The real value is the trend: if EBITDA margin slides for three months while revenue grows, your costs are outrunning you, and numbers 2 through 4 will tell you where.

    I watched this up close when my partners and I sold our first practice to a private equity group in 2016. Buyers price your practice on this number. You might as well know it every month, not just the year you decide to sell.

    The tool: a one-page scorecard and a 30-minute monthly review

    Put the seven numbers in one table. Columns: this month, same month last year, and your own target. Fill it in by the 10th of every month.

    #NumberHow to calculateThis monthSame month last yearYour target
    1Gross revenueTotal from P&L or practice software
    2COGS %Direct costs ÷ gross revenue
    3Support-staff payroll %Non-DVM gross wages ÷ gross revenue
    4Production per doctor / doctor pay %Each doctor’s production; pay ÷ production
    5ACT and invoice countGross revenue ÷ invoices
    6Active clients, new clients, bonding rate12-month rolling counts
    7EBITDA margin(Net income + interest + taxes + depreciation + amortization) ÷ revenue

    To keep your categories consistent month to month, map your P&L to the AAHA/VMG Chart of Accounts, which the AVMA also recommends for benchmarking. If your accountant isn’t using it, ask.

    Then hold a 30-minute review with your practice manager (and your accountant, quarterly):

    1. Scan (5 min). Mark each number green, yellow or red against target and last year.
    2. Pick one (10 min). Choose the single red number that matters most. Ask “what changed?” and pull the detail behind it.
    3. Decide (10 min). Agree on one action, one owner, one date.
    4. Check last month (5 min). Did last month’s action move its number? Keep it, change it, or drop it.

    You can use AI to do the grunt work. I use Claude to turn practice-software exports into a dashboard across both of my hospitals. A prompt to start with:

    “Here are my practice-software exports for revenue, invoices, production by doctor, and client counts for the last 24 months. Build a monthly table of these seven KPIs [paste list and formulas]. Compare each month to the same month last year, flag any number that moved more than 10%, and list the three questions I should ask my team about it. Tell me if any data looks missing or inconsistent instead of guessing.”

    Check the math the first time, and strip client names before you upload anything.

    Your move this week

    1. Build the table. Copy the scorecard above into a spreadsheet and fill in last month and the same month a year ago. Some numbers will be hard to find. That’s useful information on its own.
    2. Lock your definitions. Write down exactly how you count active clients, what goes into COGS, and which payroll lines are “support staff.” Share it with your manager and accountant.
    3. Put the review on the calendar. Thirty minutes, same day every month, starting next month.

    Knowing your numbers is how independent owners stay independent. If you’d like help setting up your own scorecard, you can find me on the Work with Adam page.

    Sources

  • How I Use AI to Help Run Two Veterinary Hospitals

    I own two hospitals, one in Houston and one in Cincinnati, and I can’t be in both places at once. The admin work behind them (reports, policies, purchase decisions, staff documents) doesn’t stop just because I’m on a plane. AI hasn’t replaced my managers or my accountants, but it has become a business assistant that works whenever I do. Here’s what I use it for, where I draw the line, and how you can start this week.

    You wouldn’t be early. A new Digitail and AAHA survey of 1,730 veterinary professionals found that 83.7% now use AI, up from 39.2% in 2024. But nearly half of practices have no AI strategy or anyone in charge of it. Most people are using it. Few are using it on purpose.

    1. Turning exports into numbers I can act on

    Every practice-management system can export data. Few owners do anything with it, because the reports are clunky and the spreadsheets take hours. This is where AI has helped me most.

    I export production and financial data from our practice software and have AI help me build dashboards from it: production by doctor and by service, monthly trends, and the KPIs I check every month across both hospitals. I tell it what question I’m trying to answer, it helps me structure the spreadsheet and formulas, and I check the totals against the source report before I trust anything.

    2. Pressure-testing equipment purchases

    Equipment reps are good at making a purchase feel obvious. AI is useful because it has no commission.

    When I looked at a point-of-care ultrasound, I used AI to lay out the decision instead of the sales pitch. A few lessons came out of that process:

    • Separate the use cases. Tech-performed POCUS and radiologist-performed ultrasound are different services with different revenue and different staffing. Lumping them together makes the ROI look better than it is.
    • Track demand before you buy. Count how often you’d have used it over a set period. Real cases beat a rep’s estimate.
    • Require training before purchase, not after. If nobody is trained on day one, the machine sits in a closet.
    • Decide who owns it. I want technicians, not doctors, owning handheld diagnostic tools. It puts the tool with the people who will use it most and protects doctor time.
    • Build the payoff plan before you sign. If it’s financed, know how many uses a month it takes to cover the payment.

    3. Writing the documents nobody has time to write

    Every practice needs HR documents, clinical standards and protocols. Most of us have outdated versions or none. AI gets me from a blank page to a solid first draft in minutes, and then my team and I make it ours.

    I’ve used it for staff HR documents, written clinical standards, and the framework for a doctor case-review program. It also helped me organize compensation benchmarking before we hired credentialed technicians, so I knew what a competitive offer looked like before I made one.

    My advice: have anything touching employment law reviewed by a qualified professional before it goes live. AI drafts. People decide.

    4. Delegating while I’m on the road

    I travel, and two hospitals don’t run on my schedule. AI helps me turn a scattered list of thoughts into clear instructions for my accounting team, so they know what I need, by when, and why. Clear asks mean fewer follow-up emails and fewer mistakes.

    It also helps with the odd jobs every owner gets: rewriting website copy so our claims are accurate, or setting up simple Google Ads campaigns after we brought ads in-house. None of these are hard. They’re just time I don’t have.

    The guardrails that matter

    AI is confident even when it’s wrong. In that same Digitail/AAHA survey, the top concerns were reliability and accuracy (67.4%) and data security and privacy (59%). Both are fair. At an AVMA business forum panel last year, one speaker put the standard well: “It has to be an educated, confident human in the loop.”

    Here’s what I’d put in place at any practice:

    1. Check every number against the source. If a dashboard total doesn’t match the export, the dashboard is wrong until proven otherwise.
    2. Keep sensitive data out. Strip client names, staff names, account numbers and anything else you wouldn’t post on a bulletin board. Read your tool’s data settings before you paste anything in.
    3. AI drafts, people decide. Hiring, firing, pricing, purchases and medicine stay with humans. AI helps me think. It doesn’t sign anything.
    4. Know when to call a professional. Contracts, employment issues and taxes still go to the right advisor. AI just helps me walk in with better questions.
    5. Name an owner. Nearly half of practices in the survey have no AI strategy or designated owner. Somebody should be accountable for which tools you use and how.

    A prompt you can use today

    A common mistake is treating AI like a search box. Give it context, a clear job and a format, and the output gets much better. Here’s the template I’d start with. Fill in the brackets.

    You are a business advisor to an independent veterinary practice owner.

Context: I own [number] small-animal hospital(s) with [number] DVMs.
My goal: [the decision or document I need, e.g., "decide whether to buy a point-of-care ultrasound"].
What I already know: [paste anonymized numbers, notes, or an existing draft].
Constraints: [budget range, staffing, timeline, anything off the table].

Your job:
1. Ask me up to 5 questions before you answer if anything important is missing.
2. Lay out the options, with pros, cons and the key numbers for each.
3. Tell me what you'd want to verify before trusting this.
4. Flag anything that needs a lawyer, accountant or HR professional.

Format: short sections and bullet points I can read on my phone.

    Step 1 matters most. When AI asks questions first, it stops guessing.

    Five starter jobs for your first week:

    • Paste an anonymized monthly production export and ask for three trends and three questions to ask your team.
    • Draft or update one HR document you’ve been putting off.
    • Run your next equipment quote through the checklist in section 2.
    • Turn a messy list of to-dos into clear instructions for your manager or accountant.
    • Rewrite one page of your website and ask AI to flag any claim you can’t back up.

    Your move this week

    1. Pick one job. Choose the admin task you dread most and run it through the prompt above.
    2. Set your rules. Write three sentences on what data never goes into AI at your practice, and share them with your managers.
    3. Check one output against the source. Before you trust AI with anything bigger, prove to yourself where it gets things right and where it doesn’t.

    Independent practices don’t win by outspending the consolidators. We win by running tighter and moving faster. Used carefully, AI helps with both. If you want help setting this up in your own practice, that’s the kind of work I do on the Work with Adam page.

    Sources

  • Your COGS Is Talking. Are You Listening?

    After payroll, cost of goods sold is the biggest check your practice writes. Every vaccine, every suture pack, every bag of renal diet, every reference lab panel. Most owners know their revenue to the dollar. Far fewer can tell me their COGS percentage, what’s in it, or whether it’s moving the wrong way.

    Here’s why that matters. On a $2 million practice, every one percentage point of COGS is $20,000 a year. Running 26% instead of 22% is $80,000 that never reaches your bottom line. Same doctors. Same clients. Same hours.

    Real talk: you don’t fix this by buying cheaper gauze. You fix it by knowing what your number is, what it should be for your hospital, and which lever is actually broken.

    At a glance

    • The goal: COGS at 22% or less of revenue.
    • Well-managed practices: 22.8% (2015) and 23.4% (2019 study).
    • What it’s worth: every 1 point of COGS is $20,000 a year on a $2M practice.
    • Biggest lines: drugs and parasite products are more than 60% of COGS.

    The full guide covers what the AAHA/VMG Chart of Accounts counts as COGS, what the published benchmarks actually say, category-by-category benchmarks from well-managed practices, a step-by-step method for finding where your COGS is leaking, and eight ways to bring it down without cutting care.

    Read the full COGS guide →

The Veterinary CEO

Free, practical business education for veterinary practice owners — from a veterinarian who owns and runs the business, too.