Staying put

A mobile veterinary business is a great introduction to the profession but choosing to upgrade to a bricks-and-mortar clinic requires careful financial structuring.

For many new practitioners, a mobile vet business is the perfect way to start their career. It has low start-up and operational costs, provides a great deal of flexibility and is a popular option for BOQ Specialist clients’ right across Australia.

Despite this, there often comes a time when it makes sense to pivot to a permanent clinic. Scheduling is easier, hours of operation are fixed, relationships with clients and their animals are maintained, and expanding the business is somewhat easier.

If you’re looking at setting up a bricks-and-mortar practice, it’s important to have your finances structured correctly. The biggest advantage you can give yourself is to utilise specialist financial advice from a trusted professional.

Work the numbers

The costs involved in purchasing an existing practice or setting one up from scratch are many and varied. When considering an existing practice you need an accurate assessment of what the immediate outgoings are going to be when you take over. For example, what are the running costs like wages, insurance and superannuation? Is the technology outdated? Does the building need structural work?

You also need to know the value of the business you’re purchasing—and this includes the goodwill from the previous owner. Engaging an experienced financial adviser is the first step in ensuring your business is profitable, as they will be familiar with the ins and outs of businesses like yours. Alternatively, if you plan to start your practice from scratch, this comes with a different set of financial considerations that again an experienced financial adviser can assist with.

Renting vs owning

One of the most important questions when purchasing a practice is whether to buy the building or rent the premises. Renting provides a lower barrier for entry into the market, with the flexibility to assess the location and better understand the prospects for the business before you make a major commitment. The downside of renting, other than the limitations of fit-out options to put your own ‘look’ on the practice, is that you are contributing to someone else's property portfolio instead.

However, the financial commitment of ownership can be daunting. There are many options when it comes to financing your practice. Some vets, purchase their practice premises through a self-managed super fund (SMSF) which can be an attractive option as there may be tax benefits. A mobile vet who is planning to put down roots in one spot, purchase equipment and spend money on a fit-out should discuss leveraging their Super with their financial adviser. Not only will these new assets be protected, the practice capital won’t be tied up in the property. If purchasing a property through your SMSF is not a viable option right now, there are finance options available as an alternative means.

Loan implications

At the centre of your financial structure is the business loan that makes practice ownership possible. In this instance financial advice is vitally important. A loan that meets all your requirements now may not suit your long term needs.

The true cost of a loan can be difficult to determine and the applicable fees are often additional to the proposed loan. Interest rates, loan structures and early termination fees are just a few of the many conditions to be considered. A savvy financial adviser can help you navigate through the various options and help you navigate what best suits your specific needs.

Compliance issues

Moving from a mobile business to a clinic is a big change. Mobile vets are usually run by a single vet with a fairly simple financial structure. Running your own practice increases the amount and complexity of compliance issues. You will be dealing with employees such as receptionists and nurses and there could be a number of associate vets too.

You need to be across superannuation, PAYG, GST, BAS and payroll issues. A certain level of accounting skill is required to maintain bookkeeping and invoicing records. You are still a professional vet but also an accountant, HR person, administrator, manager and supervisor.

At the end of each financial year, after all costs and outgoings have been paid, the business should post a profit. If you have an effective business plan and good financial advice, you are starting from a strong position.

An effective financial structure

The purchase of a veterinary business can be tricky. You need to go into it with your eyes open and the best possible financial advice from a trusted, knowledgeable source. Many decisions have financial implications—some obvious and others that are only realised much later on.

Each business proposition is unique and short; medium- and long-term goals should be clearly defined. Incorporating sensible financial advice into your business plan is the best way of making business ownership a profitable reality.


Click here to see how a vet achieved her practice ownership goals using finance through her SMSF. Contact one of our financial specialists on 1300 131 141 to discuss the options available to you.

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      The issuer and credit provider of these products and services is BOQ Specialist – a division of Bank of Queensland Limited ABN 32 009 656 740 AFSL and Australian credit licence no. 244616 (“BOQ Specialist”). Terms, conditions, fees, charges, eligibility and lending criteria apply. Any information is of a general nature only. We have not taken into account your objectives, financial situation, or needs when preparing it. Before acting on this information, you should consider if it is appropriate for your situation. BOQ Specialist is not offering financial, tax or legal advice. You should obtain independent financial, tax and legal advice as appropriate.