1. Business Analysis of Dairy Practice OABP Fall CE Meeting November 17, 2011 Dick Ward Bright, Ont.

2. Business Analysis of Dairy Practice History History Key practice indicators Key practice indicators Professional Fees Actual & fee schedule Professional Fees Actual & fee schedule Currently benchmark 6 clinics Currently benchmark 6 clinics Every 6 months Every 6 months

3. Fees analysis Fees analysis Key Indicator Benchmarks Key Indicator Benchmarks Vaccines Vaccines Mastitis Mastitis Reproduction Reproduction Production enhancement Production enhancement Business Analysis of Dairy Practice

4. Professional Services

5. Business Analysis of Dairy Practice ClinicHighMedianLow Hourly Rate $170$180$160$155 AM Call fee $40$44$35$30 First Hr. Call fee $210$224$200$188 Benchmarking of Fees

6. Business Analysis of Dairy Practice $50,976.56 Current Hourly Rate$170.00 Proposed Hourly Rate$180.00 Difference$10.00 Hours billed per vet per week 24.97 Opportunity Cost$50,976.56 Opportunity Cost

7. Herd health dollars per cow Herd health dollars per cow High Median Low $68.67 $48.67 $29.06 $ Business Analysis of Dairy Practice

8. Hours billed per week: average High Median Low31.23 22.90 22.90 16.12 16.12 Business Analysis of Dairy Practice

9. Percent time billed: Professional Fees High Median Low69.54%51.21%35.81% Business Analysis of Dairy Practice

10. Herd Health billings per vet High Median Low High Median Low $175,482.85$89,976.54$74,599.04 Business Analysis of Dairy Practice

11. Product sales per veterinarian High Median Low $325,576.36 $242,930.46 $188,262.24 Business Analysis of Dairy Practice

12. Prevention / therapeutic index (%) Prevention / therapeutic index (%) Clinics ABCDEF HighMed.Low 50.649.654.555.849.745.455.850.245.4

13. Mastitis

14. Business Analysis of Dairy Practice Dry Cow Treatment Efficiency (%) Dry Cow Treatment Efficiency (%) Clinics ABCDEF HighMed.Low 75.376.088.680.778.786.388.679.775.3

15. Business Analysis of Dairy Practice OrbeSeal® Efficiency (%) OrbeSeal® Efficiency (%) Clinics ABCDEF HighMed.Low 51374850.533.5325142.532 OrbeSeal® - Pfizer Animal Health

16. Business Analysis of Dairy Practice Lactating Cow Treatments – Doses per Cow Lactating Cow Treatments – Doses per Cow Clinics ABCDEF HighMed.Low 1.712.641.162.201.901.772.641.841.16

17. Biologicals

18. Business Analysis of Dairy Practice Core MLV Vaccine per Cow ( Doses) Core MLV Vaccine per Cow ( Doses) Clinics ABCDEF HighMed.Low 1.591.101.751.692.022.51 1.721.10

19. Reproduction

20. Business Analysis of Dairy Practice Prostaglandin – Doses per cow Prostaglandin – Doses per cow Clinics ABCDEF HighMed.Low 1.961.551.642.531.282.172.531.801.28

21. Business Analysis of Dairy Practice GnRH – Doses per cow GnRH – Doses per cow Clinics ABCDEF HighMed.Low 1.942.111.591.222.903.24 2.021.22

22. Business Analysis of Dairy Practice IVP4 Devices – Doses per 100 cows IVP4 Devices – Doses per 100 cows Clinics ABCDEF HighMed.Low 7.466.547.378.5618.533.9 8.016.54

23. Business Analysis of Dairy Practice Rumensin® CRC Boluses per 100 cows Rumensin® CRC Boluses per 100 cows Clinics ABCDEF HighMed.Low 37.425.543.741.240.353.9 40.725.5 Rumensin® CRC – Elanco Animal Health

24. Business Analysis of Dairy Practice Product Purchases per Cow ($) Product Purchases per Cow ($) Clinics ABCDEF HighMed.Low 76.2471.2271.1492.3976.1689.8492.3976.2071.14

25. Veterinary Clinic Dairy Producer Report Summary Cost per cow cost per hectolitre of milkefficiencyhighlow Biologics$12.05$0.12476.82%$26.32$4.45 Mastitis$39.18$0.402230.00%$49.08$17.35 Reproduction$31.24$0.320172.41%$57.55$13.98 CRC$17.25$0.17785.40%$19.23$12.20 Antibiotics$8.05$0.083$75.59$12.81 Anti inflammatories$6.49$0.067$22.27$1.95 Endectocides$13.38$0.137$21.08$0.00 Miscellaneous Drugs$32.20$0.330$39.59$15.34 Total drug cost$159.83$1.639$223.37$110.02 P/T Index61.08%77.09%42.59% total vet supplies & drugs$24,627.23$1.741 total vet supplies per cow$169.84 Total Professional Fees$11,522.78$0.815 total professional fees / cow$79.47$2.56

26. Business Analysis of Dairy Practice Summary Summary Focus on preventative areas Focus on preventative areas Promote with confidence Promote with confidence monitor and improve upon monitor and improve upon Science and Economics Science and Economics these areas should be the driver to make decisions for producer ie OrbeSeal®, vaccines, Rumensin® CRC these areas should be the driver to make decisions for producer ie OrbeSeal®, vaccines, Rumensin® CRC Send the same message among veterinarians Send the same message among veterinarians

27. Business Analysis of Dairy Practice Summary Summary Focus on professional service Focus on professional service Drug margins decreasing Drug margins decreasing Need to schedule herd health and time for other programs Need to schedule herd health and time for other programs ie udder health; calf management ie udder health; calf management Make time for other programs Make time for other programs maximize vet time for vet work and less administration; hire more help maximize vet time for vet work and less administration; hire more help

28. Business Analysis of Dairy Practice Summary Involve Associates in business discussions & philosophy Involve Associates in business discussions & philosophy 4-5 different opinions does not instil producer confidence 4-5 different opinions does not instil producer confidence Inventory management Inventory management Select products on science and economics Select products on science and economics Avoid “Walmart” marketing of products Avoid “Walmart” marketing of products

29. Thanks Thanks