IBISWorld Market Research
Growing media attention given to pets and households has aided the industry
Melbourne, Australia (PRWEB) April 06, 2015
Demand for the Veterinary Services industry has been promoted by growing awareness of animal health issues and the increasing availability of advanced surgical and diagnostic procedures for animals. According to IBISWorld industry analyst Alen Allday, “due to higher incomes, people have been increasingly willing to spend more on vet procedures to prolong the lives of their pets.” Despite flat growth in dog and cat pet populations over the past five years, the industry has expanded due to higher expenditure on companion animal vet care. Increased pet ownership over the next five years is expected to drive industry revenue growth. Over the five years through 2014-15, industry revenue is estimated to increase at an annualised 1.3% as some pricing growth offsets flat volumes. This includes forecast growth of 1.8% over 2014-15, to reach $2.6 billion. Growth over the past five years has been driven by increases in vet numbers. More graduates have entered the industry, while veterinarian establishment numbers have also increased. However, a lower average wage compared with other medical fields limits industry revenue expansion, with vets generally only able to supplement income by working overtime and weekends, or moving into senior positions.
“Despite some challenging operating conditions, new medical treatments continue to be introduced and households are showing interest in these products,” says Allday. Growing media attention given to pets and households has aided the industry, as it has helped raise awareness of new veterinary developments. Industry deregulation has fuelled brand name expansion in the past five years, as exemplified by Greencross Limited's strong growth. Previously, ownership in the industry was limited to veterinarians. The deregulation enabled participants to raise equity from a broader market to help fund expansion activities. Over the next five years, higher household discretionary incomes and vet numbers will drive industry revenue growth. With livestock and household pet populations growing at slow rates, industry participants can sustain revenue growth through the continued take-up of value-added services and higher pricing. Industry revenue is forecast to over the next five years.
The Veterinary Services industry displays low level of market share concentration. Industry establishments tend to be small, independent operations. According to the latest available data from the Australian Bureau of Statistics, veterinarian businesses with 19 or fewer employees accounted for 94.4% of industry enterprises in 2012-13. IBISWorld expects that the share has remained relatively constant over the past two years. The major company in the industry is Greencross Limited. Greencross, which listed on the Australian Securities Exchange in mid-2007, owns 125 veterinary and related practices, up from 40 in 2007. With the company looking to acquire an additional 200 practices over the next decade, the industry concentration level is forecast to increase in the next five years.
For more information, visit IBISWorld’s Veterinary Services industry in Australia report page.
The industry is made up of veterinary practitioners and animal hospitals. Veterinarians are skilled in medicine and surgery pertaining to animals. Private veterinary practice can be divided into rural practice (mainly focused on farm animals) and town practice (mainly treating companion animals).
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