Greencross managing director Dr Glen Richards has overseen some seismic shifts in the shape of the pet care and veterinary industry in Australia. As he explains to Chris Sheedy, it all started on the Trans-Siberian Express…
The Russian constitutional crisis, a stand-off between President Boris Yeltsin and the Russian parliament, wasn’t the only history being made in Moscow during the bitter winter of late 1993. In the carriage of a train departing the city in November of that same year, plans were being hatched that would change the face of an entire industry on the other side of the world, in Australia.
Taking a seven-day journey on the Trans-Siberian Express was young Australian veterinarian Dr Glen Richards who, at the time, was working at a London group practice known as John Ball & Associates. During his Vet Science degree at the University of Queensland, from which he graduated in 1988, Richards had completed several practical placements in vet surgeries and had witnessed first-hand the need for change.
“The thing that really hit home and that most concerned me during university and whilst visiting vets across Australia was a noticeably high frustration level amongst practice owners,” says Richards, who would go on to become founder of Greencross Vets and, most recently, managing director of Vet Services in the new entity formed by the Greencross merger with Petbarn.
“So many vets were burnt out and sick of running their businesses and I felt very strongly about revitalising the industry and helping people remember why they became vets. How can they be better supported so that they stick with the profession a lot longer and get a lot more out of it?”
When Richards boarded the Trans-Siberian Express knowing he had a week of snowy landscapes ahead before pulling in to Beijing, the entrepreneurial vet decided to utilise the time to develop a business plan for a network of high quality vet hospitals across Australia.
The original plan, he says, was a franchise model as opposed to the corporate model that Greencross eventually adopted. But common to both was the fact that the structure allowed for the centralisation of often expensive and time-consuming tasks and departments such as HR, IT, marketing and accounting—all vital components of successful businesses but also areas of the job that many vets never really signed up for.
“It took a number of years to evolve the business plan but during that train trip I documented the concept of a network of hospitals, called ‘Greencross’, linked by a common management platform,” Richards says. “It would allow practices and teams to be fairly autonomous on the clinical front and the business would take care of a lot of the back-end administration, helping to support vets and allowing them to be as good as they can be for their clients and communities.”
As the plan was developed further, Richards returned to Australia and in 1994 purchased his first practice, the Currajong Veterinary Hospital in Townsville, Queensland. That hospital also had a branch practice in the suburb of Kirwan. So, 12 months later when he opened his second practice, Richards was actually managing three surgeries and already beginning to feel some of the pressure he’d witnessed in the industry during his time at university.
“It was a lot to bite off and I had to work very hard, seven days a week, to make it all run smoothly,” Richards says. “Over time I ended up with five practices in Townsville and then formed, in 2001, a co-op with 15 practices in Brisbane and Townsville. The co-op was called Greencross.”
This co-op was the beginning of the realisation of the plan made on that train eight years earlier. Staying faithful to his beliefs, Richards and his business partners began loosely centralising the buying, marketing and bookkeeping processes as well as offering some other managerial support.
“In 2006 we moved to a more rigid and disciplined corporate structure and that’s when we started moving fast,” he says. “We were then approached by a team that had optioned up 13 practices—they were asking for management support. We had a running conversation for about a year and decided to join up the agendas and roll our practices in. We went to an IPO in June 2007 to raise the funds to buy the practices and it was all a bit of a baptism by fire.”
Seemingly overnight Greencross Vets had grown to 32 practices in a corporate structure, supported by capital raised by the IPO and debt funding from banks. It was a moment that would forever alter the landscape in the Australian veterinary industry and finally make Richards’ business plan a reality.
“It was a difficult first few years,” Richards recalls. “We didn’t have the management structure to support 32 businesses and we had about 300 employees. We had to learn to swim very fast.”
But it’s a pattern that has come to characterise Richards’ career so far. He develops what he refers to as a “big, hairy and expansive vision” then throws himself into it and along the way figures out how exactly to make it work.
“We have developed a number of wealth creation opportunities for veterinarians throughout Australia. Current practice owners are invited to join the Greencross network via acquisition or mutual partnership. Veterinary associates can take their careers to the next level through the flexible partnership options that include buying out their boss and opening a new state-of-the-art clinic,” Richards says. “It has been a huge learning curve but along the way you work through problems and come up with solutions.”
Perhaps his fearless attitude towards commerce came from spending most of his developmental years watching his own family, and others around them, figuring out ways to manage a business in an environment that was always unpredictable. Richards’ parents owned three sheep and cattle stations in western Queensland, collectively running around 2000 head of cattle and 10,000 head of sheep.
“I was often present during business discussions with my parents around the kitchen table,” Richards says. “It made me realise that working in a rural environment was very difficult in relation to always watching rain clouds and trying to manage commodity prices, etc. That’s why I decided to have a long hard look at the vet industry rather than going back onto the family property.”
Whether or not Richards has simply traded his parents’ weather challenges and commodity market woes for business challenges and stockmarket issues, that early experience of ingenuity in the face of difficulty certainly had a lasting effect. But the resulting experience for Richards, on a personal level, has had another surprising and altogether more welcome consequence. No longer does he work seven days a week. And no longer does he have to spend all of his time in the office and away from his wife and three children, aged 14, 13 and six.
“I now get my weekends with my family,” the 48-year-old says. “That was one of the deals with my wife when we moved from Townsville to Brisbane so I could head up Greencross—that I would do whatever it takes Monday to Friday for the business but that I would be home every Saturday and Sunday. I have been very disciplined around that.”
That balance in life, Richards says, is what he hopes Greencross will bring to the vets within its brand—not only for their personal lives but also for the health of their individual businesses.
“When you allow yourself the time to pull back and work on the business rather than in it, you go from running like a hamster in a wheel to being far more strategic and knowing there will be a lot more leverage around some of the decisions you make,” he says. “Once practice owners realise they need to spend more strategic time, they will grow their business a lot more successfully.”
Speaking of business growth, before the agreed merger with Petbarn (of which Richards was also a founding shareholder and director) just a few months ago, which caused another seismic shift in the Australian veterinary and pet care retail industries, Greencross boasted over 100 practices, over 1200 full-time, part-time and casual employees and around $140 million in annual revenue. On the Australian Stock Exchange, Greencross made it into the ASX300 largest businesses by market capitalisation. The Petbarn merger, which created the largest consumer-facing pet care company in Australasia, pushes these figures out to 200 locations and over 3500 employees, and will most probably earn the new business a spot in the ASX200.
So what shape will the newly merged business take? Richards says the fine details are still being worked on but it is envisioned that the newly merged business will include a veterinary services division and a pet care retail division.
“At the same time we’ll make sure we get the synergies,” he says. “So we’ll debate whether certain locations will have pet and vet combined. In some locations we might move the clinic into the retail environment, building a new hospital beside or inside the Petbarn. All of those things are up for debate as we move forward. Cross referral and cross promotion between the Petbarn and Greencross brands also makes a lot of sense.”
So much has changed and so much has been achieved, and
Richards is half a world away from where he was when he pulled out of an ice-bound and politically paralysed Moscow on the Trans-Siberian Express. But as a result of that journey he’s now exactly where he always planned to be.
“I tell my children I’ve moved from being a straightforward vet to the captain and coach of a whole lot of vets,” he says. “I’m now having influence across a larger group and as long as that is a positive influence