XLVets Coventry Members Meeting 29th November 2005

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XLVets Coventry Members Meeting - 29th November
2005

• COMMITTED TO EXCELLENCE IN THE FIELD OF
  VETERINARY MEDICINE

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Lesson 1
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Strategy Overview

• SHORT TERM
•  
• To establish XLVets with a target of 50, where
  practical geographically distinct, shareholding
  member practices (minimum 30). These will be
  invited by the board to join as established and
  respected practices with a significant farm
  animal component. The strategy initially will be
  one of improved efficiency and effectiveness.
•  
•  

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Wholesaler

• Past
• Present
• Future

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Wholesaler Past

• Tendering NVS
• Teething problems
• Not used to sudden LA drug requirement
• Not helped by sudden withdrawal of previous
  suppliers
• Rescheduling of van runs
• Unexpected costs drivers and vans

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Past (continued)

• NVS difficulty in holding on to existing
  practices
• Had to work hard in keeping new customers happy
• Questionnaire

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Present

• Generally practices have seen improvement
• Specials now being catered for as stocked items
  and should be more readily available
• Lack of buying history does not gear up for
  seasonality but improving
• New MD started 1st Nov Martin Riley
• Some discounts less than clear awaiting
  clarification

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Future

• XLVets own branding through NVS or other
  suppliers
• Website
• Equine and small animal
• Expected improved performance after 1 years
  buying data

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Lesson 2
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Strategy Overview

• SHORT TO MEDIUM TERM
•  
• To develop XLVets as a nationally recognised
  brand signifying expertise in farm animal
  practice. To further differentiate practice
  service offering through horizontal integration
  and enhanced current services. To explore the
  opportunities for XLVets as a template for
  companion animal practice and equine practice.

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Marketing Overview

• Ours Aims
• Client Newsletters
• Members Newsletters
• Raise Public Profile
• Raise XLVets areas of interest
•  

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Marketing Areas of interest

• Best practice approach to preventative health
  National and Local level press articles
• Website shopping making our business more
  accessible
• In roads into sale and educated use of GSL
  PMLs
• Farm Training initiatives
• Sharing practice ideas within the group \
  regional forums
• National research initiatives \ product research
  \ launches
• National co-ordinated Veterinary Group wrt
  DEFRA, Genus, Countrywide \ MVF etc

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Marketing Overview

• Now going for 4 months
• Aimed primarily at information \ best practice
  profile
• Aimed at unified action on various campaigns (26
  practices pro-actively acting as one)
• Focused partially on drugs and sales
• Need to rapidly become more than just drug sale
  focused

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Marketing What do YOU want?

• XLVets is UNIQUE group of individually minded
  vets ! as such we need to be very clear on
  XLVets goals and what we are committed to as a
  group.
• We are what YOU want us to be ?
• Manufacturers especially are still very unsure
  what to make of us whether to deal with us as
  individuals or as one.

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Marketing campaign plans

• Manufacturer National campaign
• Campaign over 3 month period
• 3 Client articles from different angles
• Whole farm team training at lunch meeting by rep
  areas to sell on, datamining by farm staff,
  seeking out new sales, publishing initiative -
  telesales \ printed advertising
• Pathology testing to induce client
• Local Farm press and farm client direct mailing
• Farm Meetings or select clients at discussion
  groups
• Sales target set to aim for by lay staff vet
  team
• Possible XLVets preferred product and net net
  price

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Marketing future campaigns

• Jan to March
• BVD campaign as per previous slide
• what XLVet product - If any ?
• Get all 3 companies to partake ?
• Sheep Worming THINK 3 campaign with
  Novartis
• - intelligent economic sheep
  worming
• - SCOPS consideration (best
  practice \ client education)

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Marketing future campaigns

• April to June
• Dry Cow Therapy
• Best Practice approach \ NMR cell counts \
  Interherd \ cow product selection etc
• Orbeseal
• ?? Dry cow therapy consensus

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Marketing Future Campaigns

• What next !?
• July Sept
• Oct Dec

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Marketing Articles Approach

• Drove Small Animal Newsletter
• Monthly campaigns
• Product deals advertised one campaign, one
  product and all 10 surgeries push deal
• Focus on what practice can do for client
• (can XLVets behave as multi branch practice? .
• All for one and one for all ?)

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Marketing Articles Approach

• Drove Farm Newsletter
• Feature based
• Product deals advertised
• Range of species covered
• Focus on what practice can do for client
• (can XLVets behave as one practice? .
• Unified team focus and farmer deals on service
  products?)

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Marketing future of articles?

• Do we become more eye catching and feature based
  ? --- much less educational as a result.
• Is monthly too many? ---- Quarterly ?
• Articles will become more varied as XLVets
  extends into other areas eg webshop, training,
  national initiatives

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Marketing Q As

• What other areas of interest to practices?
• Do we remain information based wrt articles
  rather than eye catching \ sales based what
  farmer feedback?
• Do we select particular products to get behind as
  a group? buying group?? Or remain non specific
• Do we get behind specific best practice protocols
  as a group (vs acting as indiv practices or even
  vets!)
• Do we in specialised areas get more public \
  political wrt XLVet representation on farming
  subjects?

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Marketing Summary

• We are all totally committed and respected farm
  Practices
• It is essential we ALL act as XlVets with our
  practices delivering the XLVets ethos
• It is essential we act proactively, promptly and
  as One in marketing
• It essential ALL members give frequent and
  regular feedback directors comfort wrt support
• - directors comfort wrt direction we are taking
  on behalf of members
• It is essential ALL members raise new initiatives
  and promote XLVets

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Lesson 3
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Review of XL Vets Cevac Chlamydophila Campaign

• Can XL Vets help grow the market?
• Can XL Vets influence the market?
• Lessons learnt

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Vaccines available for prevention of Ovine
Enzootic Abortion

• CEVAC CHLAMYDOPHILA
• ENZOVAX
• MYDIAVAC

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Can XL Vets help grow the market?
AVG
XL VET
UK MARKET
5,730
47,800
645,220
2004
6,630
63,670
704,570
2005
15870 33.2
CHANGE
59,350 9
15.7
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Can XL Vets help grow the market?

• UK Market growth 2004 2005 59350 doses
• XL Vets growth 2004 2005
• 15870 doses
• XL Vets contributed 26.7of the growth of UK OEA
  Vaccine sales

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Profit for AVG Cevac Chlamydophila
TOTAL PROFIT
DOSES
PROFIT
NNN
Retail
2.90 (XL VETS 1.60 2.90) (NATIONALLY 1.20
3.15)
14,067.20
6280
2.24/dose
0.66
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Profit for AVG
2005 CEVAC CHLAMYDOPHILA 14,067 ENZOVAC
402
14,469
2004 ALL OEA VACCINES 9,168
57 INCREASE
5,301 MORE PROFIT
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Can XL Vets influence markets?

• Company share of OEA vaccine YTD

2005
2004
374,910 53
ENZOVAX 446,180 69
204700 29
CEVAC CHLAMYDOPHILA 67,720 10
124,960 18
MYDIAVAC 131,320 20
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XL Vets Influence on Market

• Enzovax 2004 41,810 9 National growth of
  market 49,945 doses projected for 2005
• XL Vets sold 18,710 doses Enzovax
• So 31235 doses moved to CEVA
• Intervet lost 71,270 doses this year
• XL Vet responsible for 31,235 71,270 43.8 of
  Intervets lost sales

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XL Vets influence on market

• Cevac 2004 - 67,720 National growth of market
  9 74,417
• 2005 204,700
• Growth 130,283
• XL Vets 31,235 doses moved to CEVA
• 31,235 130,283 23.9 of CEVA growth
  attributable to XL Vets

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So

• XL Vets influence markets
• XL Vets carrot 23.9
• XL Vets stick 43.8

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Lessons Learnt

• Six month lead in
• Consult with XL Vets practices which are key to
  the nominated product.
• Will they back the Nomination?
• Access to group figures
• Organise marketing
• Practice newsletters
• Local Press
• National Farming Press

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Lessons Learnt

• Approach company
• Key senior personnel have been identified
  within each of the main pharmaceutical companies
• Marketing assistance what is this worth ? 5k
• Net price to all XL Vets practices
• Confirm in writing (end of the season)
• Get the basics right
• Be Bold

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Summary

• Can XL Vets help grow the market?
• Yes by 33
• Can XL Vets influence the market?
• Yes - Carrot 23.9
• Stick 43.8
• Be Bold

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Vets XL lamb
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Vetcel lamb
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Lesson 4
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Pneumonia Campaign 2005

• Bovipast RSP vs Rispoval 4

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Member Vaccine Sales 2004(25)

• Rispoval 4 doses sold approx 32,000
• Bovipast RSP doses sold approx 45,000
• Total Vaccine Doses 77,000

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XLVet Member Sales Sept/Oct 2005

• Rispoval doses 18,155
• 56 of 2004 sales

• Bovipast doses 16,680
• 37 of 2004 sales

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Sept/Oct 2004 cf Sept/Oct 2005Original NVS
practices only (8)

• 2005
• Rispoval 4475
• Bovipast 2880

• 2004
• Rispoval 3040
• Bovipast 1490

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Sept/Oct 2004 cf Sept/Oct 2005
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Bovipast Swingometer

• Of total members (25) 12 buy more Bovipast
• Of total members (25) 13 buy more Rispoval
• 2 members purchased NO Bovipast
• 6 (of 18 reviewed) changed towards Bovipast
• 1 (of 18 reviewed) changed away from Bovipast
• 11 (of 18 reviewed) made no change

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Summary

• Bovipast XLVets net price per dose 2.83
• Rispoval 4 net net price per dose 3.58
• Too early to evaluate pneumonia campaign
• Initial impression that all sales increased
• Some practices more effort than others
• Many reluctant to try new product
• Will Intervet Benefit?
• What do the group want?
• How do we do things differently?

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What Next ?

• Future Marketing campaigns? BVD 2006
• Individual Products worth chasing?
• Own label branding think of much larger
  picture.
• We must not underestimate the potential power of
  our group!

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Purchasing of medicines

• Exclusives/Vaccines etc.
• Tied in with promotional/research etc.
• Generics
• Me too type products
• Price most important issue? At a given minimum
  quality standard
• XLV Branded

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XLV branded products

• Further promotes XLVet brand
• Competitively priced
• One deal instead of many
• Not available to non-XLV outlets
• Premium product pricing??
• Difficult to make direct comparison re price etc.

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XLV branded products

• Commitment
• 3 to 5 year contract
• Delivered to one source every 6m NVS?
• Reviewable regarding quantity/timing
• Once contracted in we must pay so commitment
  important
• Only applies to generics and no restriction on
  supply of other rival products
• Not available for distribution via
  websites/consultancy etc.

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Norbrook potentially!

• Always been keen from the off
• Want to supply us on same terms as other
  companies I.e. at wholesale level
• Have a vast range of products they can
  manufacture (including non-Norbrook marketed
  products)
• Flexible, helpful, can-do company
• New products licensing/launching
• Partnership mentioned many times

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Disadvantages?

• Alienates some of the other companies?
• Tie-in factor
• Commitment to volume order
• Branding its what we make it

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Strategy Overview

• MEDIUM TERM STRATEGY
•  
• Market penetration, facilitating and accelerating
  the movement of farm clients from traditional
  mixed practice with a diminishing farm animal
  involvement and expertise to XLVets members.
  Developing partnership activity with other
  industry large contributors including
  pharmaceuticals, DEFRA and the food chain to
  provide profile and opportunities for member
  practices.

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Lesson 5
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xlvets.co.uk xlvets.com a.n.other.co.uk
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xlvets.co.uk xlvets.com a.n.other.co.uk
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xlvets.co.uk xlvets.com a.n.other.co.uk
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xlvets.co.uk xlvets.com a.n.other.co.uk
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Strategy Overview
LONG TERM STRATEGY   To provide comprehensive
national geographic coverage through member
expansion, new member acquisition or by
establishing new practices for XLVets.
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The Future of Farming needs A Healthy
Industry which needs Healthy Animals
Attitude is Everything by Bonnie Mohr
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PROGRESS TO DATE

• 26 Member Practices
• 20 Million Drug Purchasing Power
• Wholesaler Discounts
• Initial Marketing Campaigns
• Sheep Abortion Vaccines - CEVA
• Pneumonia Vaccination Intervet
• Relationship Building
• Etc

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PROGRESS TO DATE

• NFU Insurance Policies Best rate -5
• Nutritional Advisor on Retainer Richard
  Vecqueray
• NVL 25 Additional Discount
• Dickies Clothing Wholesale Prices
• Merial MOO Initiative 5 x 100
• Genus Bull Examinations
• Frank Wright/Cosecure Customised Mineral

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PROGRESS TO DATE

• Client Newsletters
• Members Newsletters
• Website
• Discussion Forum
• Members Area Presentations Etc
• Branding
• Meetings National and Regional
• Benchmarking Practice and Client Level

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XLVets Accounts November 2005 XLVets Stats
11.05.xls
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XLVets
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PRACTICES

• Geographical Footprint then by invitation
• Scarsdale Minster Paragon
• LLM 608 Clyde
• Westmorland Millcroft Drove
• Kingsway Aln Shepton
• Barnard Castle Westpoint Southfield
• Bishopton Chapelfield Cain
• Scott Mitchel Kingfisher Cooper Ptns
• Abbey Vets Hook Norton Belmont Vets
• Rutland M OS LLP

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CRITICAL SUCCESS FACTORS

• Momentum
• Commitment / Teamwork/ Carrot Stick
• Confidentiality
• Internal marketing / communication
• Critical mass - 30-40 practices
• A Board committed / time / profile in industry/
  
• Branding architecture the key to differentiation

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Lesson 6
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CRITICAL SUCCESS FACTORS

• Momentum
• Commitment / Teamwork/ Carrot Stick
• Confidentiality
• Internal marketing / communication
• Critical mass - 30-40 practices
• A Board committed / time / profile in industry/
  
• Branding architecture the key to differentiation

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Lesson 7
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DISCUSSION POINTS

• Newsletters Content/Style/Format
• Local Newspaper Articles
• Rolling Out The Message Farming Press?
• Shared Resources
• Right of Veto
• Board Priorities

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VETO/OBJECTIONS

• New Members
• If felt that a Proposed Practice should be
  offered the opportunity to join-
• DB to Contact Member Practices within 50 mile
  radius prior to visit
• Any objections to be in writing to The Board who
  will make ultimate decision in writing with
  reasons

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Lesson 8
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Muck and MagicPutting the science and sales
of mineral supplements in your hands using
XLVets as the vehicle.
Rod Welford Millcroft Veterinary Group,
Cockermouth
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Minerals The practitioners perspective.

• Overt Clinical Presentations (paramedic)
• HypoMg/Ca
• White muscle
• Production disease (consultant)
• Sub-optimal conception rate
• Poor oestrus expression
• Milk fever prevention
• White line disease
• Scour colostrum deficiency Se deficiency

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The niche

• Plethora of mineral salesmen offering a panacea
  to every ailment.
• Often on minimal science with little reference to
  cow health and production. Without a holistic
  evaluation of the ration.
• Result to farm
• Wasted money on wrong product
• Risk of toxicity.

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The holistic approach.

• Get a diagnosis. Blood sample the cows. Telsol
  ltd.
• Forage mineral analysis and ground
• water mineral analysis through
• validated labs.
• Analyse the complete ration (forage, cake,
  straights, water) holistic mineral profile

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• Technical back up. Pete Bone
• Balance minerals available in diet to production
  needs of cow.
• Produce a bespoke solution /- Cosecure balanced
  /- bespoke mineral product.
• Deliver via on farm meetings with nutritionist.

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The result to date

• Positive
• A valued input to addressing production disease.
• Independent bespoke advice / product in the
  minefield of mineral nutrition.
• May result in advice to cut back minerals
  saving.
• Strayed into bigger picture of nutritional
  management.
• Negative
• Salesman slips in a similar spec of there own.
• Cosecure sourced pennies cheaper from the trade.
• Correct bespoke minerals but outsourced.

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Vets need a commercial interest in mineral
consultancy.

• charging fees
• taking a margin from product.

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The commercial interest

• Bagged minerals
• UK market of 90,000 tonne p.a. (20.7million)
• Bespoke added value minerals often cost no more
  than off the peg.
• 80-100 per tonne margin.
• Bucket products
• UK Market 17,500 tonne p.a. (6.5million)
• Mg / Fertility buckets
• 160-200 / tonne margin
• Accessory product
• Iodised salt

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Frank Wright Ltd, Ashbourne

• Labs
• Ration -gt mineral profile.
• Technical support
• Product range
• XLVet livery
• Logistics for delivery

www.frankwright.com
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The opportunity

• Minerals medium for vet to deliver independent
  production disease advice.
• Additional income stream to XLVet practices.
• Flagship service that appeals to farmers.
• Ref
  Trefaldwyn Vets
• Hits back at the trade seeking vet medicine
  market.
• Legislative pressure on mineral trade.

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Telsol / Frank Wright offer

• Telsol FW Lab analysis as priced.
• Regional training days in the mineral market and
  how to establish product.
• Interpretation and technical support.
• Option of in-practice software.
• Cosecure product at competitive price.
• XLVet branded bespoke mineral direct to farm.

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Muck and MagicPutting the science and sales of
mineral supplements in your hands using XLVets
as the vehicle. Members view?
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Lesson 9
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NUTRITION SUPPORT - APPETITE
50 Monthly Retainer For Unlimited Telephone
Technical backup Then 50 an hour for specialist
time and advice