This calculator is designed as an exercise tool to accompany the article The Right Way To Increase Prices At Your Veterinary Hospital. It will help you identify all the costs you incur when delivering services at your hospital and automatically calculate a price based on those costs and your desired profit margin.

Though you can use this for single services, it’s also great for bundles. Try building a total price for an annual exam including vaccines and laboratory services. The calculator will give you a total for the bundle, then you can sort through individual service item prices and mark them up higher or lower to stay in line with competitors. As long as the final price of the bundle is equal to or greater than the result returned by the calculator, your bundle price will be sufficiently profitable.

Follow the instructions under each heading to learn how to calculate each step of the pricing formula.

Veterinary Pricing Calculator

Gross Revenue

Adding your business's gross revenue will enable some benchmark calculations, but you can skip it if you prefer.

Total Fixed Expenses

Total Payroll

Include payroll taxes

Number of weeks open per year

Most practices are closed for 6 Federal holidays or are only open for 51 weeks out of the year. If this is true for your practice, leave the default, otherwise change as needed.

Hours open per week

Example: Monday-Friday open 8am-6pm, Sat 8am-2pm = 58

Payroll Costs per Minute

Fixed Costs per Minute

Total Fixed/Payroll Costs per Minute

This number represents how much money the practice spends per minute just to be in business. It does not include variable expenses like lab, pharmacy, and food costs that are proportional to sales.

Benchmark: Payroll/Gross

Make sure that your payroll includes payroll tax and pay for any owner doctor(s) that is commensurate with his or her production. This number should be in the 38-44 range.

Benchmark: Fixed Exp./ Gross Revenue

Make sure that your Fixed Expenses do not include payroll or payroll tax. This number should be in the 18-22 range.

Benchmark Costs

Number of Concurrent Services

On average, how many services are offered at your practice simultaneously? For example, if you have two exam rooms and one surgery suite, there are 2-to-3 services running concurrently. If the rooms are not full at all times, you can write the number as 1.5 or 1.75. The reason we do this is because if there are two services happening at the same time, then each can shoulder a portion of the fixed expense rather than the whole per-minute-fixed expense. This feature helps return a more realistic price that's likely to be more in line with competitors.

Number of Concurrent Services

Directions for this Section

 

Service

Enter the name of the service you are attempting to price. You can type something in like Annual Wellness Bundle, Exam, Rabies Vaccine, Adult Wellness Profile, etc.

Minutes per Job

If you are calculating a bundle of services (like an annual exam), make sure that you include ALL the time it takes you to complete the services including interpretation of any diagnostics. It is okay if the time you charge exceeds the time the client is in the exam room because often patient service continues after the client has left the building.

Number of minutes per job

Material Costs

Include the costs of all products associated with the service.

Material Costs

Laboratory Costs

Include the costs of all lab services. This includes any reference laboratory fees or internal costs like rotors, slides, stains, etc. You may add medical waste into this field as well

Laboratory Costs

Shrinkage, Giveaways, Discounts

Practices usually giveaway or discount a sizable portion of revenue every year. We have built a conservative default of 7 cents per minute into the equation to cover this loss. Adjust up if you have an accurate idea of how much money per minute is lost in shrinkage, giveaways and discounts otherwise leave the default.

Shrinkage, Giveaways, Discounts

Calculating Shrinkage

Desired Profit

Desired profit defaults to 20%. If you need to change it, write the number as a decimal, so 25% would be 0.25. Keep in mind that since so many of our services are loss leaders, it is necessary to charge more than 20% for some services to make up the difference. More information on loss leaders pricing. NOTE: If you are using the calculator to determine prices of individual services or products, enter these benchmark margins into the field below. Enter them as decimals as written.

• Pharmacy items: 0.45
• Laboratory services: 0.25
• Diet: 0.65

Desired Profit

Total Price

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