The Growing Divide: How Practice Size Shapes Success in 2025
Why Bigger Isn’t Always Better, But Scale Still Matters
In a year defined by uncertainty, one pattern stood out clearly in the 2025 Veterinary Industry Benchmark Report from iVET360: practice size plays a huge role in performance.
Larger veterinary hospitals continued to post positive revenue growth in 2024, while smaller practices faced a tougher climb. The difference isn’t about quality of care—it’s about scale, systems, and strategic adaptability.
Small Practices Are Feeling the Squeeze
For smaller clinics, 2024 was a challenging year. Many are contending with tighter margins, rising costs, and a client base that’s more cost-conscious than ever. Revenue growth among hospitals generating less than $2 million a year slipped, driven largely by a nearly 10 percent drop in new client acquisition.
At the same time, client visits fell while average transaction charges softened. That combination is especially difficult for smaller operations, where every appointment carries more weight.
Economic headwinds like inflation and vendor pricing increases continue to make it harder for small practices to compete. Many owners are hesitant to raise prices out of fear of losing clients, yet they are also struggling to maintain profitability without doing so. It’s a balancing act that requires smarter, not just harder, decisions.
The Power of a Strong First Impression
One proven way to bring in new clients—and rebuild volume—is to remove the initial barrier of cost. Offering a Free First Exam may sound like a loss leader, but in reality, it is one of the most effective strategies for long-term loyalty.
That first visit builds trust and gives your team a chance to show what sets your practice apart. When done right, it converts curiosity into connection. A small investment upfront can translate into years of repeat visits and consistent revenue.
As the report notes, a Free First Exam isn’t a giveaway—it’s leverage. It opens the door to relationships that grow stronger with every appointment.
Operational Wins Are Happening
While the overall industry faced challenges in 2024, there were encouraging signs under the surface. Both COGS and labor expenses as a percentage of revenue improved slightly across all practice sizes. That’s a quiet but powerful indicator that operational efficiency is improving.
Smaller practices achieved this by tightening inventory management, improving compliance, and leaning into high-margin services like wellness labs, imaging, and dental procedures. These everyday diagnostics helped stabilize revenue even as visit volume declined.
It’s a reminder that profitability isn’t just about increasing top-line revenue. It’s about understanding your numbers, identifying the levers you can control, and executing consistently.
The Staffing Equation Is Shifting
Labor remains the largest expense for most hospitals, accounting for roughly 40 percent of total revenue, but there are encouraging developments here too. Support staff wages have decreased slightly as a percentage of revenue, now averaging 21.6 percent, thanks to smarter scheduling and better utilization of team members.
Non-owner DVM wages, on the other hand, rose significantly—especially in larger practices. That signals that bigger hospitals are successfully attracting and retaining associate veterinarians by offering competitive pay and mentorship opportunities.
This matters because retention and capacity go hand in hand. When clinics can keep their doctors and support staff engaged, the entire operation becomes more stable and scalable. Every position filled and every schedule optimized makes a measurable difference.
Smart, Sustainable Adjustments
The practices that are thriving right now aren’t necessarily the biggest. They’re the ones making smart, sustainable adjustments that add up over time. They are improving call conversion, refining their client experience, and tracking key financial metrics in real time through tools like Pulse, iVET360’s data dashboard.
The goal isn’t massive expansion—it’s steady, strategic growth built on efficiency, insight, and connection.
Small practices may not have the same resources as larger hospitals, but they have an advantage of their own: agility. They can implement change faster, personalize care more deeply, and connect with clients in a way that larger operations often struggle to replicate.
The future of veterinary success won’t belong solely to the biggest players. It will belong to those who are bold enough to adapt and precise enough to measure what matters.
The Takeaway
Scale matters, but strategy matters more. Whether your hospital brings in two million or ten million a year, your ability to analyze, adjust, and act will determine your long-term trajectory.
The data from 2024 tells a story of resilience in the face of challenge—and proof that even small shifts can produce meaningful results.
