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Practice Management

The Exorbitant Cost of Turnover (and How to Avoid It)

by Stith Keiser, Suzanne Blair-Burtner

    Your prized new associate has asked you for a meeting to discuss something important, and you’re so busy right up to the moment when you both sit down that you haven’t had time to contemplate what the topic of conversation might be. It can’t be anything too serious. After all, things are running smoothly, all the equipment’s working, there doesn’t seem to be any unnecessary drama going on behind the scenes, and for once, you’re fully staffed and reaching your production goals! This particular associate has been a real boon to the practice. Five months in, and the clients have really warmed up to him, the staff has adjusted to his particular style and methodology, and he’s even started to grow a whole new aspect of the practice with his special interest in exotics. Sure, you turned down some other decent candidates that might have cost you less in salary, but this guy has delivered on all his promises and has been worth the extra money you’re paying and the year it took to find him.

    He looks you in the eye and starts talking about how much he enjoys working at the practice. You smile and nod and hope he can’t hear your stomach rumbling, only to realize that he’s just said the words “unfortunately,” “sorry,” and “two weeks’ notice” in quick succession. His voice fades to a garbled hum as the blood rushes to your ears, and your eyes glaze over as you frantically wonder how on earth you can be finding yourself in this position yet again. Your mind starts racing with a thousand questions, such as “How could I have not seen this coming?”, “How long is it going to take to replace this guy?”, and “What’s going to happen to all the new clients bringing in their exotics?” Equally important is the question, “What is this going to cost us?”

    Adding Up the Costs

    While it may feel like you’re stuck in a nightmare that you can’t wake up from, the fact is, you’re not dreaming. You’re also not alone. Your practice is facing an all-too-familiar scenario found at veterinary hospitals nationwide. Turnover in our industry is incredibly high, and it costs us big time. Identifying exactly how much can be complicated, but the following are just some of the factors that contribute to the cost of turnover:

    • Advertising costs can be prohibitive, especially over the course of a few months.
    • The time it takes to find a replacement can dramatically affect production.
    • The need to hire costly relief in the meantime can eat into the budget fast.
    • The time it takes the staff and clientele to adjust to the absence and then the replacement can affect trust, compliance, and ultimately, productivity.
    • The number of clients who leave due to the change will have a profound effect on your bottom line. Imagine even only 10% of your best clients leaving. Ouch! The loyalty we encourage in our clients can really backfire if they follow a team member to another practice.
    • Additional turnover among the staff due to the chaos or divided loyalty can be a real headache.
    • The time taken away from everyone’s primary responsibilities during the hiring process can be very costly. If a veterinarian is missing time in the exam room to screen applicants, the bottom line will definitely suffer.

    We find (and several sources agree) that the actual collective costs of turnover can range anywhere between 1.5 to 2 times the annual salary of the person leaving. This could be as much as $120,000 for an associate! Not only will this amount cripple your bottom line, the experience will have a tangible effect on your team’s morale and enthusiasm for work. The challenge of being temporarily short-staffed, followed by the introduction of a new team member, can be exhausting, and if it’s repeated too frequently, it will leave your staff feeling battered and beleaguered.

    Stopping the Revolving Door

    Turnover rates in the veterinary industry are estimated to be as high as 30%, according to a 2009 study by the American Animal Hospital Association.1  With the cost of replacing one veterinarian potentially as high as twice his or her annual salary, the industry is losing millions of dollars combating this problem. How can your practice avoid being repeatedly scraped over the coals, both financially and emotionally?

    Find the Right New People

    Hiring the right candidate in the first place can really improve your turnover rates. Here are some tips to help you get it right the first time:

    • Know thyself. A practice really needs to analyze its own strengths and weaknesses before it can determine what it needs in a new member of the team.
    • Compatibility matters. If possible, candidates should share your practice’s philosophy and should have demonstrated that in their work history. Don’t be fooled by a candidate who tells you what you want to hear to get the job.
    • History repeats itself. A candidate who has been easily dissatisfied in the past will often find some reason to justify leaving your practice also. Some people just can’t settle down!
    • Family counts. Never underestimate the power of a local family tie. There are lots of people who can successfully integrate into a new town or state away from family and friends, but you’re taking a gamble on hiring someone new to the area.
    • Share a vision. Knowing a candidate’s short- and long-term goals is crucial for retaining him or her over time. If you’re aware that someone is really only biding his or her time until a residency opportunity opens up, you can’t act surprised by “the meeting.”
    • Don’t jump the gun. It can be hard to wait for the right person to come along, but with patience and due diligence, you can hire the right person. Your practice is better off holding out than taking a chance on a very risky investment.

    Keep Your Existing Staff

    The second way to avoid the high cost of turnover is to retain the employees you have. Keep in mind that it can be easy to hang onto good people when the economy’s in a slump, but when things look up, companies often find themselves losing the very team members they need to cope with the increasing workload. (See the December 2011 article "Keep Your Top Talent From Running for the Hills.") How can you make sure that your employees feel valued?

    • Encourage effective two-way communication. It’s important to allow your employees to give feedback. Doing so will give you an early opportunity to make adjustments that can improve the quality of the workplace, or to counsel a dissatisfied team member on changes he or she needs to make to find job satisfaction.
    • Mentor. Establishing a great mentorship plan can cultivate great long-term relationships with more recent graduates by providing them with adequate support as they grow into a position.
    • Make sure your compensation remains competitive. Any employee worth his or her salt is going to want fair compensation. Review your contracts and ask yourself, “Is this fair?”
    • Allow for growth within your company. You may or may not be able to offer partnership opportunities, but you can still offer employees the chance to take on a particular niche of the business and make it their own. Encourage resourcefulness and creativity, and share in the rewards.
    • Make sure each individual feels challenged and appreciated. Offer praise and recognition where it’s warranted and up the ante for those who are feeling stagnant in their work.
    • Keep your promises. Employees lose faith when you fail to follow through. If you offer a timeline for your actions, put a reminder on your calendar to make sure you don’t pass the deadline you set for yourself.
    • Improve conditions as quickly as economic recovery occurs. Many practices were forced to make changes when the economy turned sour, but if you fail to make corrections as your bottom line improves, your employees will feel that you are taking advantage of them.

    Looking Ahead

    Savvy practice owners and managers develop a combined strategy for harmony in the workplace and are rarely caught by surprise. They also keep in mind that people’s circumstances can change abruptly. Even if you are not actively looking to add to your team, taking the time to speak with someone who expresses interest in working at the practice could lead to a future opportunity for both of you, perhaps sooner than you anticipate!


    It’s too late to do anything about the employee turning in his notice today. Try to regain your composure, shake his hand, wish him the best, and dust yourself off. It’s time to come up with a plan. Avoiding the exorbitant costs of turnover requires putting a strategy into place, but once you get a handle on the problem, you can stabilize your bottom line and concentrate your efforts on providing your clients and patients the best care.


    1. American Animal Hospital Association. Compensation & Benefits. 5th ed. Lakewood, CO: AAHA Press, 2008.

    Stith Keiser is CEO of My Veterinary Career, and Suzanne Blair-Burtner is a matchmaker and practice liaison for the company.


    Did you know... 4.4% of veterinarians younger than 30 work with food animals or a mix of food and companion animals, while 44% of those who do are 50 and older.

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