National survey reveals elastic price sensitivity for select equine veterinary services.
Authors: MS Olivia L. Gibson, PhD Shuoli Zhao, BVetMed Emma Adam, PhD C. Jill Stowe, Dr. Stowe
Journal: Journal of the American Veterinary Medical Association
Summary
# Equine Veterinary Service Demand: What Price Sensitivity Means for Your Practice Gibson and colleagues surveyed 4,915 horse owners across all US states between August and September 2023, asking them to indicate their willingness to pay for three common veterinary interventions: routine vaccinations, elective lameness examinations, and urgent colic surgery. Using demand modelling techniques, the researchers estimated price elasticity—essentially measuring how sensitive owners' purchasing decisions are to changes in service costs. All three services demonstrated elastic demand, meaning that proportionally larger declines in service uptake would occur relative to any price increase; for instance, a 10% price rise might trigger a greater than 10% reduction in quantity demanded. The findings suggest that whilst raising fees could reduce client numbers, the accompanying operational efficiencies and lower per-unit costs might actually improve overall practice profitability—a counterintuitive but potentially valuable insight for practice management. For farriers and allied equine professionals, these results underscore the importance of transparent pricing communication and considered fee structuring; practices might explore tiered service models, strategic bundling, or differential pricing for routine versus emergency care to optimise both accessibility and financial viability.
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Practical Takeaways
- •Price increases for routine and elective services may reduce volume but could improve profit margins—test pricing strategically rather than assuming higher prices always lose clients
- •Emergency colic surgery and lameness exams show different price sensitivities; consider separate pricing strategies rather than uniform increases across all services
- •Consider tiered service offerings and bundled pricing rather than across-the-board increases, as horse owners' willingness to pay varies significantly by service urgency and type
Key Findings
- •All three equine veterinary services (vaccinations, lameness exams, colic surgery) demonstrated elastic demand across US horse owner populations
- •Quantity demanded for these services would decrease proportionally more than price increases, suggesting price sensitivity varies by service type
- •Survey achieved national representation with responses from all US states, indicating robust geographic distribution of price elasticity estimates
- •Strategic price increases could enhance practice profitability despite reduced service volume, due to lower associated costs at higher price points