 This is our drugs room. Just been injecting some joints this morning so I'm just stocking up on my joint injection drugs. So as you can see we have quite a lot of stock in this practice and our drug bills are pretty scary each month so yeah we have a lot sitting on the shelves here there's a lot of money in this just sitting on the shelves and all this is stagnant obviously people need to pay the bills in order to restock the the drugs cupboard but they're yeah don't underestimate how much money sitting on the shelves in these practices it's it's often hundreds of thousands of dollars. The drugs bills are scarily big they mount up very very quickly you know you really have got to pay those drug companies you know when you bill out and keeping it's inconvenient for you if you walk in and you can't stock your car up so just that's another thing that's very important for having people paying up front if you can't do the jobs you want because the drugs you want aren't in the drugs room then no that has a big knock on effect for everyone then you need to pay your drugs companies and keep them happy because there aren't many there aren't many at all and yeah you want to keep them on side. Our practices costs almost 50 percent of our our costs are in staff salaries so every time the animal's in hospital it's being walked the cage is being cleaned we pay that regardless of what goes on with the animal and then blood tests and medications and things like that we build all of those on a monthly cycle and so those costs are coming into us constantly and so if we don't charge for that not only are we not my handy profit we're actually losing money because we have to pay for the blood test even if it wasn't charged for. Cash flow is really important because it's obviously how everyone gets paid and we pay our bills so for most of our our services we're billed monthly so the first of each month we get a bill from our wholesalers we get a bill from all of the electrical companies and the utilities and things like that and so we're expected to pay them straight away we don't get accounts longer than the end of the month with any of our providers. We pay our staff fortnightly so every two weeks the staff get paid and so if suddenly 50 percent of my clients didn't pay for six weeks I wouldn't be able to pay my wholesalers I wouldn't be able to pay my staff and it gets really tight some months so two months a year because we pay fortnightly we have to do three pay cycles in a month those months we always experience a loss because our salary outgoing is greater than our total income that's the sort of profit margins we're talking about in an in a vet practice that an extra pay cycle destroys it and so it's really important that we're very careful about charging for what we do accurately and ensuring we collect those monies at the end. In my practice that I worked in England was very seasonal so I worked at a big equine embryo transfer centre and also with polopony so both very very seasonal so from February to October we were absolutely flat out and then it really quietened off and you see the well the income basically two thirds of it disappears during the winter out here in Australia it is seasonal as well we did quiet enough for a few months over the winter and then we're really picking up again now so out here it's not it's only for two months probably so that doesn't have a big effect on the practice in England it did have a big effect on the practice and we had to we actually spend a lot of time building up the winter work and moving into other sportshorse areas to try and build up the winter work so that it didn't fall off so much over the winter. It's very important consideration for all the bosses in the practice and if you can get on board as an employee as well and try and help build up the practice that will you know be very much appreciated I imagine and really lead to less stress in the workplace it's important for practices that do have a seasonal lull to try and work out a way of dealing with that otherwise you would have problems where you couldn't pay your invoices. So what we do is we have a budget set for the whole year so we look at we know how much and we always start off with staff because staff is our biggest expense so we know how much our staff is going to be for the the whole year or we estimate how much it is and then on top of that we have to pay for uniforms and continuing education and superannuation and sick leave and long service leave so we estimate all of those costs for the staff that we think we're going to need for the next year then we know that we have the fixed costs so we have rental and we have interest and other things like that and then we have variable costs which are cost of goods sold so drugs and consumables and and all of the things we use in surgery and then we look at how much the the practice needs to make to reinvest and to compensate everyone fairly and things like that and that gives us a budget for how much we need to make.