Editor's Note: There are many reasons that a practicing equine veterinarian might want or have to change jobs. These could range from moving to higher education, industry or government positions, to injury, retirement or perhaps a higher calling. Whatever the reason, this article can give you insights into other careers besides the daily practice of an equine veterinarian. The featured covered of AAEP's business sessions in the March/April issue of EquiManagement magazine was brought to you by Zoetis, which also sponsored an additional four articles from the 2016 AAEP Convention found on EquiManagement.com under Resources>Downloads.
At the 2016 AAEP Convention in Orlando, Drs. Mary Beth Whitcomb and Andrew Clark presented basic and comprehensive break-even analyses to explain a rational process for deciding when to add new equipment or services. Equipment purchases can be impulse driven or simply due to a perceived need to keep up with competitors, they stated. Unfortunately, poorly considered purchase decisions can lead to underutilization of equipment and lost capture of associated costs, they said.
In deciding whether to add equipment or a service, one must consider pricing, opportunity cost and necessary training, Whitcomb stated. Of those, opportunity cost is the aspect most commonly ignored, she said.
Opportunity cost considers what you could be doing with your time or money if you weren’t doing the thing you were considering. If you are in a busy practice and are adding a piece of equipment that allows you to add a new service, you must ask: Do I have time in my day to do this new service? What will I need to give up in order to find the time, and how much will that cost? How much demand is there for the service and/or equipment that I am contemplating purchasing? Do my clients’ expectations of my practice require me to take this step, regardless of the financial consequences?
To read the full article, brought to you by Zoetis, click here.