By Karina Adams
Special Investigative Report

Executive Overview

The veterinary medicine industry stands at a historic and critical inflection point. For much of the post-pandemic era, veterinary practices enjoyed robust demand paired with aggressive pricing strategies that sustained profit margins despite surging operational costs. However, as macroeconomic indicators shift—characterized by a stabilizing broader economy counterbalanced by persistent consumer hesitancy and caution—the old playbooks are no longer sufficient. Veterinary visits remain under pressure, and practice leaders can no longer rely on routine price hikes to drive top-line revenue.

To unpack this shifting landscape, renowned veterinary economist Matt Salois, PhD, is set to lead a comprehensive live industry session examining the macroeconomic forces shaping the United States economy, analyzing the latest veterinary market data, and projecting the trajectory for veterinary practices heading toward 2027.

At the core of Dr. Salois’s strategic vision is a simple yet powerful framework for unlocking sustainable growth: Capacity × Utilization × Client Value.

Moving far beyond abstract economic theory, this upcoming session zeroes in on the practical, operational drivers that underpin each variable of the equation. From maximizing staff productivity and deploying workflow-enhancing technologies to improving care acceptance rates, client retention, convenience, and institutional trust, the overarching objective is clear. Veterinary practices must fundamentally rethink where their future growth will originate and take concrete, actionable steps today to future-proof their operations for the challenges and opportunities of 2027 and beyond.

Detailed Chronology: The Evolution of Veterinary Market Pressures

To understand where the industry is heading, it is necessary to trace the compounding market dynamics that have defined the veterinary sector over the past decade.

The Pre-Pandemic Baseline (2015–2019)

Before 2020, the veterinary industry experienced steady, predictable growth. Pet ownership was on the rise, driven largely by millennial demographics entering pet parenthood, and spending per pet was gradually climbing. Practices operated on traditional scheduling models, and while talent shortages—particularly among veterinary technicians and support staff—were beginning to emerge, supply and demand remained relatively balanced. Profitability was generally tied to physical hospital footprint expansion and steady increases in transaction volumes.

The Pandemic Boom and Inflationary Surge (2020–2023)

The COVID-19 pandemic completely disrupted historical norms. Pet adoption skyrocketed as millions of people found themselves working from home, dramatically increasing the pet population and driving unprecedented demand for veterinary services. Clinics faced overwhelming caseloads under strict health protocols.

As the economy rebounded, however, severe inflationary pressures took hold. Supply chain disruptions, rising pharmaceutical costs, and a competitive labor market forced wages upward. To survive and maintain margins, veterinary practices across the nation turned to aggressive pricing strategies. Routine price increases of 5% to 10% or more became common practice. While consumers absorbed these costs initially due to the high emotional value placed on their pets, a threshold was eventually reached.

The Post-Boom Reality and Consumer Caution (2024–Present)

By late 2024 and into 2025, the macroeconomic environment entered a different phase of growth. While broader economic metrics—such as GDP growth and employment rates—showed signs of stabilization, the everyday consumer remained deeply cautious. Persistent inflation, high interest rates, and economic uncertainty squeezed household budgets.

Consequently, veterinary visits began to experience downward pressure. Pet owners started delaying preventive care, skipping routine wellness checks, and postponing non-essential procedures. Practices quickly realized that the era of relying solely on pricing power to drive revenue had drawn to a close. Pushing prices higher in an environment of constrained consumer spending threatened to alienate clients and depress visit volumes even further.

The Road to 2027: Strategic Pivot

As the industry looks toward 2027, veterinary leadership faces the imperative of reinvention. Growth can no longer be bought through inflation-matching price increases; it must be engineered through operational excellence, strategic resource allocation, and a deeper alignment with evolving consumer expectations. This historical context forms the backdrop for Dr. Salois’s upcoming economic analysis and strategic framework.

Supporting Context & Metrics: The Anatomy of Veterinary Growth

To operationalize growth in this constrained economic climate, practice owners and managers must look closely at the underlying metrics governing hospital performance. Dr. Salois’s framework—Capacity × Utilization × Client Value—serves as a diagnostic lens through which practices can identify operational bottlenecks and revenue opportunities.

[Capacity]  ×  [Utilization]  ×  [Client Value]  =  Sustainable Practice Growth
(Physical Space, Staffing, Workflow)   (Appointment Fill Rates, Efficiency)   (Care Acceptance, Retention, Trust)

1. Capacity: The Physical and Human Bottleneck

Capacity is the absolute ceiling of what a veterinary practice can deliver, dictated by physical infrastructure, equipment availability, and, most importantly, human capital.

• The Labor Crisis: The veterinary industry continues to navigate a structural shortage of licensed veterinary technicians (LVTs) and veterinarians. Burnout, compassion fatigue, and uncompetitive compensation in certain sectors have exacerbated retention issues.
• Workflow Inefficiencies: Many practices waste significant clinical hours on administrative burdens, manual data entry, and inefficient client communication.
• Expanding the Ceiling: To increase capacity without necessarily building new facilities, forward-thinking practices are leaning into team-based healthcare models—such as utilizing certified veterinary technicians to the top of their credentials—and streamlining operations to see more patients safely and effectively.

2. Utilization: Maximizing Existing Assets

Having capacity is meaningless if it remains unutilized. Utilization measures how effectively a practice fills its available appointment slots and deploys its resources.

• Appointment Fill Rates: Empty slots in the daily schedule represent permanent losses of perishable revenue. Clinics must analyze peak versus off-peak demand, reduce no-show rates through automated confirmation systems, and optimize scheduling templates.
• Technological Leverage: The strategic integration of modern technology—such as AI-powered dictation tools, digital client intake forms, and cloud-based practice management software—allows teams to move patients through the hospital more efficiently, directly boosting daily utilization metrics.

3. Client Value: Deepening Relationships and Care Acceptance

The final multiplier in the equation is client value, which encompasses average transaction value (ATV), client lifetime value, and, crucially, care acceptance.

• The Trust Deficit: When consumers face economic uncertainty, their willingness to approve recommended diagnostic workups or therapeutic plans drops. This is rarely about a lack of love for the pet; rather, it stems from a lack of financial confidence or a failure to perceive the immediate value of the recommendation.
• Communication and Education: Increasing client value requires elevating the standard of communication. Veterinarians must bridge the empathy-and-economics gap by offering transparent, tiered treatment options, transparent pricing discussions, and robust preventative care education.
• Retention Economics: Acquiring a new veterinary client is significantly more expensive than retaining an existing one. Practices that build long-term trust, offer seamless digital convenience (such as mobile apps and telehealth follow-ups), and deliver exceptional client experiences secure higher lifetime value and more consistent revenue streams.

Official Statements and Industry Insights

As the veterinary community prepares for the live session with Dr. Matt Salois, industry leaders and economic analysts have shared their perspectives on the urgency of adopting new operational frameworks.

Dr. Salois emphasizes that the transition from a pricing-led market to a value-and-efficiency-led market requires a fundamental mindset shift among practice owners:

"We are exiting an extraordinary era where veterinary practices could rely on routine price adjustments to offset rising operational costs and generate growth," notes Dr. Salois in preliminary briefing notes. "Today’s macroeconomic reality demands a more sophisticated approach. Consumers are navigating financial headwinds with caution, and visit growth is under pressure. Practices that thrive between now and 2027 will be those that stop looking at price tags as their primary lever and instead focus intensely on optimizing their capacity, maximizing resource utilization, and delivering undeniable, trusted value to every client who walks through their doors."

Industry association leaders have echoed these sentiments, pointing out that operational resilience is no longer optional. In an era where corporate consolidators and independent practices alike compete for the same client base, efficiency and quality of care serve as the ultimate differentiators.

• Operational Agility: Clinics embracing modern workflow automation report a measurable reduction in staff stress and an increase in daily patient throughput.
• Financial Literacy: Practice managers are increasingly encouraged to look beyond gross revenue and analyze profit margins, labor costs per full-time equivalent (FTE), and client acquisition costs.
• The Human Element: Despite the push for technology, veterinary medicine remains an inherently relational business. Industry analysts stress that trust and empathy remain the strongest drivers of long-term client retention and care acceptance.

Future Outlook: Positioning Practices for 2027 and Beyond

Looking ahead to 2027, the veterinary landscape will likely favor agile, data-driven practices that successfully balance economic realities with clinical excellence. Several key trends will dictate winners and losers in the market:

The Rise of the Tech-Enabled Practice

Technology will no longer be viewed as a luxury upgrade; it will serve as the core operating system of successful veterinary businesses. Practices that leverage artificial intelligence for diagnostic imaging assistance, predictive analytics for inventory and staffing management, and seamless digital platforms for client communication will pull ahead of competitors clinging to legacy paper or fragmented software systems.

Redefining the Care Continuum

To combat flat or declining visit frequencies, progressive practices will expand their service offerings beyond the traditional four walls of the clinic. Integrating preventative wellness plans, leveraging telemedicine for follow-ups and triage, and creating structured home-care guidance will help practices maintain continuous touchpoints with pet owners, cementing loyalty before health issues escalate into expensive emergencies.

Cultivating Sustainable Workforce Models

The ongoing labor shortage will force a cultural evolution within veterinary workplaces. Practices that prioritize staff well-being, offer flexible scheduling, invest in continuous professional development, and foster collaborative team environments will successfully attract and retain top-tier talent—thereby protecting and expanding their operational capacity.

Conclusion: Taking Action Today

The path to 2027 requires practice owners, medical directors, and practice managers to move away from reactive firefighting and toward proactive, strategic execution. By embracing Dr. Matt Salois’s framework of Capacity × Utilization × Client Value, veterinary professionals can demystify the drivers of growth and implement practical solutions today.

Whether it is auditing daily workflows to reclaim wasted clinical hours, retraining teams on empathetic financial communication to boost care acceptance, or upgrading technological infrastructure, the steps taken now will determine which practices simply survive the economic squeeze and which ones truly lead the next era of veterinary medicine.