Key Performance Indicators Every Practice Should Monitor

Analyzing your practice’s financial data and client data helps ensure the financial health of the business and helps to guide marketing initiatives. Let’s take a look at some of the key performance indicators or KPIs that every practice should routinely monitor.


Revenues need to be tracked on a monthly basis and compared to the same month from the prior year. Don’t forget to look at trends. A slight dip in revenues for one month may not be a concern but a steady downward trend is a problem. The sooner you notice a decline in revenues or a downward trend, the sooner you can take action to improve revenues. Regardless of whether revenues are up, down or stagnant, engage in further analysis to determine what is driving the numbers. For example, revenues may be up due to a price increase that was instituted the prior month or quarter. But the number of client transactions may be down. Don’t be complacent and miss the fact that the number of clients or pets being seen is declining.

Number of Client Transactions

The number of transactions or number of invoices should be evaluated along with revenues. This KPI can be a major reason for declining revenues. It is of concern if the # of transactions is trending down even though revenues are stable or increasing. A decline in transactions may be due to a decline in the number of new clients, clients not showing for appointments, a decline in clients coming in for wellness visits or other services, poor reminder systems, and a decline in patient visits in general.

Doctor Productivity

Track the amount of revenue generated by each doctor in the practice on a monthly basis as well as their average client transaction (ACT). Sometimes changes in these figures can explain changes in the total revenue for the hospital. The ACT can be an indicator of how effective doctors are at performing excellent case work-ups and communicating the value of services to pet owners. If a substantial decrease in doctor production or ACT occurs, it is time to investigate the underlying cause for the change. If you notice considerable variations in the data for different veterinarians in the practice, see if you can determine why one doctor is able to produce more than his or her colleague.

Income for Profit Centers

Analyze revenues by service category or profit center to gain valuable information about which services are more or less utilized at your practice. Service categories include exams/consultations, vaccines, laboratory testing, imaging, surgery, hospitalization, anesthesia, dentistry, and product sales. Compare the amount of revenue for each service category as a percentage of your total revenue to published industry benchmarks to determine how your hospital is performing compared to other hospitals. Looking at revenues for different services helps to identify areas of opportunity for establishing marketing goals.

Client Numbers

Active clients are defined as those clients that have visited the practice at least once in the past year. The practice needs an active client base to ensure the financial success of the practice. Ideally, the number of active clients per full time equivalent doctor should be 1,200-1,900.

Be sure to also track the number of new clients who visit your hospital each month to assess how well the practice is doing at attracting new pet owners. The industry benchmark for the average number of new clients per doctor is 25-30 new clients per month. New practices and younger practices will have higher numbers while older, more established practices in communities with minimal growth may have lower numbers.


All expenses need to be closely monitored and controlled to ensure the financial health and profitability for the business. The most important expense categories to assess and monitor for your practice are:

1) Facility costs: rent/mortgage payment, property taxes, insurance, repairs and maintenance, utilities

2) Doctor and staff compensation (including wages, payroll taxes, retirement contributions)

3) Drugs and medical supplies (including OTC, Food, HW and flea products)

4) Laboratory costs