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Key Performance Indicator: Measuring Outside Reference Laboratory Sales

Melissa Tompkins, BS, CVPM, South Coast Veterinary Management Solutions, Long Beach, California

November / December 2018

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A practice’s total outside laboratory sales, which includes all tests sent to reference laboratories, can be used as a key indicator of practice success. Once the practice’s total outside laboratory sales are determined, they should be broken down per veterinarian. In-house laboratory sales can be tracked the same way if the practice decides to determine total practice laboratory sales.


Diagnostic tests yield detailed results about a patient’s health beyond the physical examination. Measuring revenue from outside laboratory sales is important because it helps determine whether the practice is utilizing services that typically correlate with a high standard of medical care. Practices should set goals for the amount of revenue expected each month, as well as track total outside laboratory sales per veterinarian to determine if any veterinarians are underutilizing this tool. 

Increasing Outside Laboratory Sales

  • Audit practice records to ensure clients are being charged appropriately for laboratory tests.
  • Encourage all veterinarians to recommend laboratory tests, when appropriate, based on established practice protocols (eg, a wellness profile on a middle-aged patient to establish baselines for the patient and screen for early signs of disease).
  • Offer senior wellness care guidelines or packages to encourage diagnostic testing for older patients.
  • Renegotiate, at least annually, the practice’s contract with the outside laboratory to minimize costs to the practice.


Most practice management software programs are able to provide the total outside laboratory sales and individual number of tests performed, making tracking these sales easy. When a practice has agreed on protocols and the tests that should routinely be submitted to outside laboratories, appropriate client fees should be established. Pricing with outside laboratories is negotiable, especially for high volume tests, to maximize practice margins on frequently run tests.


Goals for outside laboratory sales must be determined by each individual practice. AAHA benchmark key performance indicators, which can be used for comparison1 and make setting goals for revenue growth easier, can help practices align with or even exceed national averages; however, the ultimate goal should be providing the best quality patient care.

A certified veterinary practice manager can help a practice understand KPIs and so much more. Visit the Veterinary Hospital Managers Association at for information, resources, and certification.


For global readers, a calculator to convert laboratory values, dosages, and other measurements to SI units can be found here.

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