12 May 2023
IVC Evidensia has insisted it needs to change the way its finance operations are carried out, potentially putting hundreds of jobs at risk, despite claims it ignored long-term problems in a push for expansion.
Allister Webb
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One of the world’s largest veterinary companies has been accused of putting profit before people amid potential job cuts and fresh expansion plans.
Hundreds of staff are believed to be at risk of redundancy at IVC Evidensia because of proposals to outsource its finance work to an external operator.
The company argues that change is needed, despite the risk of “significant short-term” disruption for practices, to provide better services to clients and their pets.
But union leaders said they were “shocked” by the move and offered their support to affected workers.
The decision, which emerged after details of an investment programme potentially worth hundreds of millions of pounds were outlined, is also claimed to have provoked “huge unrest” among staff who felt it demonstrated expansion was being prioritised ahead of other concerns.
One correspondent to Vet Times, who described themselves as a former IVC employee, wrote: “They appear to be placing profits higher than human beings on their priorities.
“These are the people that have worked tirelessly to get them where they are.”
An email sent to affected workers in recent days, which Vet Times has seen, said it was “imperative that we have the effective and efficient back-office service required to help our clinics in delivering our purpose”.
It continued: “As our business has grown, the systems and processes we have in our finance back office have simply not kept up.
“It is clear we need to significantly improve the efficiency and effectiveness of the support we provide.
“To help accelerate improvements in our service levels, we’re currently having discussions with a specialist third party around potentially outsourcing finance back office services to enable our veterinary teams to better focus on animal care and customer service.”
The email insisted the proposal was not a reflection on the work of present staff, but did confirm that workers in four separate teams are “at risk of redundancy” over the next 6 to 12 months.
It is understood that around 400 staff in all are affected.
The document further stated: “Should we decide to proceed, we do anticipate the transfer of processes is likely to lead to significant short-term service interruption for our clinics.”
Although mitigation strategies would be explored, it added that practices would be prepared for an initial reduction in available support.
The company has stressed the process is at a very early stage and rejected the claim profits were being prioritised, suggesting change was seen as inevitable and some of the workers affected may be able to seek other roles.
A spokesperson said: “IVC Evidensia is committed to delivering outstanding care to animals and outstanding service to our customers.
“We continually review our back-office services to ensure they are supporting the business in the most effective and efficient way.”
But the former employee claimed the issues the firm was now trying to address had been known to bosses for some time, but were either ignored or deemed too expensive to fix amid a desire for further expansion.
He wrote: “If the leadership had listened and invested two years ago, this drastic action could have been avoided and probably cost less in the long run.”
Meanwhile, the British Veterinary Union (BVU) said it was “shocked” by the proposal and invited any staff affected by it to contact them for support.
The group added: “The BVU supports all staff in veterinary companies, and would urge those working at the affected head office in Keynsham to consider unionisation ahead of any redundancy consultation in order to access the best support available to them through a trade union.”
The outsourcing plan was revealed after IVC confirmed that it – together with its major investors – was looking at ways of raising additional capital to fund new investment and potential expansion.
The company had previously insisted its UK expansion plans would not be affected by moves to sell off eight businesses acquired over the past two years following an investigation by the Competition and Markets Authority (CMA).
The deadline for a decision in that case has now been pushed back to the end of June, although the CMA has indicated the company’s divestment proposals are likely to be accepted before then.
While only limited detail of the capital raising plan has been disclosed, it is understood it could result in up to £800 million pumped into the business in the coming months.
Documents seen by Vet Times show a continuing confidence on the part of IVC bosses about the resilience of the veterinary sector, despite the ongoing economic pressures facing both households and businesses.
They said: “The veterinary industry continues to be a very attractive market with long-term growth tailwinds including humanisation of pets, increasing willingness to spend, and recession resiliency.”
The papers also revealed the company’s revenues and earnings had more than doubled in two years.
Revenues climbed from £1.31 billion in 2020 to £2.84 billion last year, while pro forma EBITDA jumped from £248 million to £581 million over the same period.
