Market overview
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Market segmentation
UK veterinary services can be segmented into the following activities:
- Healthcare and control activities for farm animals
- Healthcare and control activities for animals in the racing industry
- Animal healthcare and control activities for pets
- Animal ambulance services
Market size
The market size of the UK veterinary services industry has grown at a compound annual growth rate (CAGR) of 3.2% between 2017 and 2022. This market is expected to increase by 12.1%, reaching £5.1bn in 2022.2 The expansion has been supported by increased household disposable income, pet ownership rates among UK households, and the continued ‘humanisation’ of pets.
This market is expected to increase by 12.1%, reaching £5.1bn in 2022
Increasingly advanced medical, surgical and diagnostic procedures, along with the growing availability of new drugs, are expected to increase the range of services that vets can provide, further contributing to market growth.
The UK pet population has increased dramatically since COVID-19, growing from 41% in 2019 to 62% in 2022, booming particularly among young people seeking companionship during lockdown.
Increasing consumer awareness on animal health and welfare has provided the industry with a degree of immunity from weak economic conditions, as well as veterinary spend being non- discretionary for most households.3
COVID-19 implications
During the onset of the pandemic, veterinary practices were considered ‘essential businesses’, providing animal health support and other essential services for the community.
COVID-19 increased staff shortages in the UK veterinary sector, exacerbated by a lockdown pet boom, with 40.1% of vets working overtime to cover labour shortages.4 Veterinary practices understaffed because of the pandemic, had to rely on locum vet providers.
According to the Pet Food Manufacturers’ Association (PFMA), around 4.7m UK households adopted a pet since the pandemic started. Additionally, 17% of UK households welcomed a new or second pet into their home.5 Due to the increasing amount of pet ownership, demand for veterinary services increased.6
around 4.7m UK households adopted a pet since the pandemic started
Despite these challenges, the veterinary sector adapted well to the impact of COVID-19, with 65% of pet owners confirming it did not make it harder to access medicines.7 Adaption methods have been like the wider human medical profession, with telemedicine becoming a core change to veterinary practices. Joii, a UK-based online-only telehealth veterinary app saw its usage increase by 900% over the pandemic.8 Now, over a third of veterinary clinics offer telemedicine as an option.9
Brexit implications
The impact of Brexit on the veterinary industry has been high, with the focus largely on labour shortages in the industry.
The impact of Brexit on the veterinary industry has been high, with the focus largely on labour shortages
The British Veterinary Association (BVA) highlighted vet shortages, after the workforce saw a drop of more than two-thirds in new EU registrants coming to work in the UK, in two years. Data released by the Royal College of Veterinary Surgeons (RCVS) revealed the annual number of registrants coming to work in the UK fell by 68%, from 1,132 in 2019, to 364 in 2021.10 This drop is attributed in part to the end of free movement, Brexit and COVID-19, which could result in wide-ranging impacts across the sector, particularly in areas such as international trade and public health. Conversely, the UK’s veterinary workforce is highly reliant on EU registrants, with RCVS data from 2021 indicating 29% of the existing workforce graduated from veterinary school in the EU.
The veterinary profession and the government have been monitoring the situation, introducing measures aimed at mitigating shortages. This includes modifying language testing requirements, a new certification support officer role to work under the direction of official veterinarians, plus new vet schools and course places, to boost domestic supply.
Growth in pet ownership
According to the latest annual population data by the PFMA, pet ownership is at a peak, with 17.4m households (62%) now owning a pet.
Demand for pets has soared since the onset of COVID-19, with enquiries increasing by more than 253% during lockdown.11
This surge in demand for pet ownership is supported by a continued demand from Millennials and Generation Z.
A recent study found 70% of Generation Z would rather adopt a pet than have a child, showing the strength in the pet ownership trend amongst younger generations.
Additionally, the younger generations are clearly prepared to make sacrifices to ensure their pet’s medical bills, with 49% willing to start a second job in order to cover the payments.12
Humanisation of pets
Pet humanisation is defined as the attribution of human thought, feelings, motivations and beliefs to animals. In other words, owners want their pets to be treated as they would a child in the family. In society today, owners want their pets to share a similar lifestyle. Some examples include nutrition, birthdays and social media – with one in six pets now having their own social media account.13 As a result, premiumisation has become a consistent factor in the market, with people willing to pay a higher price to ensure their pets receive the best. In many instances, premium pet products mirror what is happening in the human food industry.
humanisation of pets drives up demand for veterinary services
Consumers are increasingly purchasing more pedigree and ‘designer’ dogs, even if they have long-term health- issues, which drives up veterinary service demand. Additionally, with working from home continuing post-COVID, people are spending more time with their pets. As a result, they notice problems which previously may not have been apparent – further increasing demand on the sector.
This humanisation of pets drives up demand for veterinary services in other ways. Firstly, insurance coverage has grown to match the demands of pet owners willing to pay higher premiums, for a wider range of medical problems. This leads to a higher requirement on veterinary practices, as owners expect treatments for a wider range of ailments.
