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Help Practices Increase Preventative Value With a Costco Mentality

By Vet-Advantage
May, 2015

Parasites are on the rise in 2015 and your mission is to help practices prepare for a nasty season. No matter which area of the U.S. you cover for distribution sales… you'll want to make note of these Companion Animal Parasite Council (CAPC) forecasts for 2015:

  • HEARTWORM: "We are predicting higher than normal levels of infection for several areas of the country including Idaho and the Upper Midwest (Iowa, Wisconsin, and Minnesota). In the Southeast, there are essentially no month-to-month breaks in the forecasted prevalence."
  • ERHLICHIOSIS: "Ehrlichia will be above normal for dogs residing in or traveling to New England, or the Ohio River Valley. Although lower than normal risk is forecasted in selected parts of Arkansas, Texas, Oklahoma, and Missouri in 2015; the disease is extremely prevalent in this region so the threat needs to be taken seriously."
  • LYME DISEASE: "CAPC predicts higher than usual threat in areas where the disease is currently widespread. The disease appears to be spreading in a southwesterly direction. Areas of particular concern are New England, the Upper Ohio River Valley and the Pacific Northwest."
  • ANAPLASMOSIS: "We are forecasting a high level of risk for New England and the upper Ohio River Valley. In addition, in most geographies east of the Mississippi River, where the disease is indigenous, we are predicting an active year so the risk level is above normal."

More than ever, you'll want to discuss prevention with practices. To drive the most noncompliance and revenue, help them educate more pet owners and stock up on recommended preventatives with a "Costco mentality."

What do we mean by "Costco mentality?" Jason Wernli, co-founder of Ally DVM and a consultant to hundreds of veterinary practices, has been teaching the principles of a Costco mentality and explains how it will benefit any practice.

He said, "Veterinary hospitals do themselves a disservice when they don't stock plenty of preventatives in the practice, because demand is generated in the hospital, during conversations with pet owners.

Think about it. During the patient visit, a doctor has the opportunity to discuss prevention, ask about preventative use and recommend the best product(s) for each pet. That's the ideal time to offer products in-house, during checkout.

When we work with animal hospitals, we tell them, 'You're going to kill your compliance if you don't have the products in-house, because most people will go home and forget to order them online. Plus, you lose some of your margin by sending clients online.'

Hospitals are much more successful when they carry a narrow selection of recommended preventatives in bulk and dispense them accordingly. This means selling them in bulk as well, in 6-month or 12-month dose packages.

That's what we mean by the Costco mentality: bulk sales of preventatives.

Now, if your customers balk at trying to sell preventatives in bulk to clients — because they don't feel clients will accept it or can't afford it — consider this. What we're seeing in the veterinary industry is that people don't have an issue with the total size of the invoice. They have a problem with perception of value.

If you help practices show clients the value, clients actually prefer to buy in bulk. It's more convenient and quite often, they get a price break.

At times, hospitals create their own problems by doing the one-off sale of a single box of preventative. When you realize that Costco thrived during the economic downturn… and the average Costco invoice is close to three times that of your average retail grocery store…you can see how a hospital would benefit by selling in bulk.

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You can help practices overcome their concerns about bulk preventative sales and give them home court advantage for compliance.

Show hospitals the benefits of offering clients a few primary recommended preventatives in 6 or 12-month bulk packages… and how the hospital will increase compliance and sales of heartworm, flea and tick preventatives. Here's how you can do this.

  • Help practices narrow their focus on a few primary products they'll discuss and promote at the front desk. The veterinarian should decide which products he or she feels delivers the best medicine in the region and limit it to one or two choices. Remind your customers that the prevention conversation takes place in the exam room and, based on each pet's situation, a recommendation can be part of the discussion.
  • Explain that they should proactively offer rebates on bulk purchases. The perception of value goes up when a preventative is: a) recommended by the trusted veterinarian, and b) available with a $50 bulk-purchase rebate (for example). Clients will quickly understand that this is the best value they'll see. Clients may even buy enough bulk preventatives for several pets at home to take advantage of the rebate savings. Sure, they'll have a bigger invoice with the practice, but they'll be happy because of that high perception of value. (We've even heard of situations where a client says he wants to tell his friends about the great deal offered by the practice.)

This Costco mentality/value strategy has been a huge tipping point for the practices we consult with."

See how you can enlighten practices on the Costco bulk mentality and get your customers on board? This will help everyone: clients, practices and you! We want to thank Jason Wernli for this terrific, eye-opening strategy for the distribution sales force.

Topics: Preventatives

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