All of this starts in vet school. In the course of our schooling we get a decent amount of unbiased scientific nutritional education from fully qualified veterinary nutritionists, but at least 18 class hours in each of the four years of veterinary school are spent on specialized diets and how they should be marketed to our clients. All of the students are provided with pet food, free, for every animal they own, for the duration of the four years. Most also sign up their friends and family for special discounted food and get paid to do this, and this is where the habit starts. They know that this could be a significant part of their cash flow over the next few decades, if they learn to play the game. And boy, do they ever.
As a fully fledged veterinarian, every time I purchase pet food from one of the large pet food corporations and sell it on to a client, the food company pays me money. It’s a lot, too. They give me anywhere from $10 to $25 a bag for recommending their diets. This drops with repeated sales to the same clients over time, so if a client repeatedly buys the same food for their pet, my payout decreases, down to the range of $5-8 per bag or case. This is why I am continually having people try new foods for their pets. If the company has a new diet out that they are pushing, though, the payout to the vets goes up a lot. I might get $45 for every big bag of a new diet that I sell, so I take advantage of this and really push new foods to clients to maximize my earnings.
There are also “team bonuses” for the clinic based on overall annual sales. If we sell food in excess of some target number, a check shows up at the clinic at the end of the year. No target hit, no bonus. Because of this, veterinarians who don’t have a flair for sales can bring the income down for the vets that they work with. There is often pressure from the higher producers for the low producers to sell more food, resulting in more pressure on the client to buy foods from the clinic.
The checks for individual sales are made out to the vets personally, not the company, so I profit personally from food sales and so do all of my associates. In fact, every veterinarian I know is making quite a lot of money selling prescription and non-prescription pet foods. One of the vets in my graduating class told me he made about $70,000 last year in “appreciation money” from the big three veterinary pet food manufacturers. And he’s not the best at the game by a long shot.
An extra layer to the deal, particularly for practice owners, is the pet food company reps. If they see that I am buying less of a particular food this year than I did last year, they’ll come in and ask me why. If I tell them I’m recommending a competitor’s brand, they’ll sweeten the pot. To lure me back into the fold, they will promise (and actually provide) luxury vacations (under the guise of “continuing education”), special discounts on their foods (increasing my profit margins), and other incentives if I promise to “go steady” with their company for a year. If you play the game right, you can get a decent trip every couple of years by going back and forth between the companies. This also maximizes your cash back because you are continually putting pets on new foods, avoiding the classic “sales drop-off” I explained above.
On a smaller scale, I mark up the price from what I pay for the food itself. I can easily double (or more) the price of the food and I make a decent profit on it. With that kind of markup I can make $20-25 free and clear on every bag of food that costs me $30. Pretty sweet. That money, like the year-end “bonus”, goes to the clinic’s account, of course. Some of the “bonus” money gets distributed to the other vets in the clinic, but any excess goes straight into my pocket, and I don’t tell the taxman about it. Owning a vet clinic is an extremely lucrative business, mainly because of the food sales.
As you can see, I would be in bad shape without the kickbacks. (Oops, I mean “the appreciation money”.) The average veterinarian only makes $65,000 per year in salary. In order to maintain our lifestyles, we need the money from the food companies.
Now, I can understand your outrage. “How can my vet be making food recommendations when he’s just making money off of it? That’s not ethical! If he is making nutritional recommendations based on how much money he makes from the manufacturer, how can I trust him? How can I trust that anything he tells me is meant to be for the good of my pet, and not to line his own greedy pockets??”
To that I say, grow up. A veterinarian is just as unethical and greedy as any banker, lawyer, taxi driver, or real estate agent. Why should we look out for you at all? You are fully capable of looking after your own financial affairs, and we are obviously out to look after our own. We’re in it for the money, man. We’ve got bills to pay.
Now some of you got this far and are pretty satisfied with yourselves. “I knew it,” you crow, “I’ve known that for years. What a scam.” I congratulate you on your perspicacity and your obvious intelligence, and your ability to hang onto an idea despite the lack of any credible support for it. The veterinary profession has been trying to keep this secret under wraps for a long time, but in this internet age, it just can’t hold up any longer.
But I’ve got some news for you smart-alecs, too. Everything I wrote up to this point is an absolute lie. Well, except for the part about getting a decent, non-partisan education in nutrition, and the bit about the average salary. Those were true.
The rest of it is conspiracy theory nonsense. The only thing that vet students get from food companies during school is a student price on the pet foods and maybe a pizza lunch with a noontime “talk” about a nutritional topic sponsored by a company. That’s it. Yes, they appreciate the discounted food. They are, after all, making zero income while attending four years of vet school. The discount is a drop in the ocean as far as cash for the major companies; they can afford it, and they hope to leave the students with positive feelings toward their diets.
But to take a pizza lunch and imagine that this forgettable ‘perk’ will spread out to influence the entire career of a veterinarian, to invent kickbacks and biases and thoughts of unethical behaviors is just… silly. Some people have a little too much time on their hands.
I don’t sell much pet food. Because I’m not WalMart or PetsMart or AnythingMart, my volumes are too low to get a really good price. My cost to purchase a Eukanuba performance diet directly from the manufacturer is higher than PetsMart sells it for in store, never mind the cost (to me) of ordering, shipping to me, stocking, making the sale, and putting on a markup so the clinic doesn’t go broke. So why would I bother? I’d have to charge my clients considerably more than they’d pay at the pet store, enhancing my reputation as a money-grubbing veterinarian. I send my clients to the pet store for those kinds of foods.
I feel that I have to stock certain diets because I actually believe that my patients will benefit from them in the management of certain diseases. Most of these diets are marked up 40-60% (lower than the pet store markup). If I pay $30 for a bag, I sell it for $42. Of that $12 in apparent profit, though, most is eaten up in the costs of having the stuff in the clinic, so the clinic pockets about $3 per bag. None of that goes into my pocket. It makes up part of the 10-12% profit margin that most veterinary clinics show. We use that money to reinvest in equipment and upgrades for the hospital. Any salary increases for the veterinarians also comes out of that 10-12% of profit that the clinic makes.
The food companies don’t care about me or my clinic. They don’t pay me anything to sell their foods. They are too busy selling about a thousand times as much food to my local pet store to spend one second thinking about me.
The food companies aside, I don’t understand how people can really believe that a vet takes a “kickback” on food sales and is making money hand over fist on it… but will still go to that vet. If you really believe that your vet is that unethical, walk. You cannot trust anything he says, ever, about anything. If he’ll accept money for selling you something, that’s corrupt. In fact, if you really believe this is happening you should immediately make a complaint to your local veterinary medical board, because this is illegal in most areas.
Oh, I forgot… the veterinary boards are in on it too. Damn.
I also don’t understand the people who believe that vets are being paid by food companies (so won’t take the vet’s advice) and then turn around and go to a pet store to buy food. There they ask the minimum wage worker with a high school education for nutritional advice, purchase what is recommended, and never make the money-advice connection. Pssst. The employees at the pet store are paid to sell you things. I’m pretty sure the store makes a healthy profit on everything you buy. It’s called retail sales.
I’ve had people tell me to my face that I’m in the pocket of a food company. I don’t think they have stopped to think about how incredibly insulting this is. They’ve just accused me of being unethical and unprofessional. And this is dropped into the conversation as sort of an aside, like it doesn’t really matter much, just a part of going to the vet.
It DOES matter. I am an ethical, moral person. I try to maintain the highest level of integrity in my dealings with my clients and patients, whether it’s on the medical side or the business side. If this is your opinion of my profession, of ME, get out of my hospital. I never want to see you again. You can find someone else to see your pet. Maybe that vet will stoop to your expectations, and turn out to be unethical and immoral (and, if the triad is to be completed properly, incompetent to boot; the three usually go together). For the sake of your pet, I hope not. But for you, karma’s a bitch.