Banfield Pet Hospital cuts revenue with student debt relief

When Brian Garish was a young man, he dropped out of college and got a job as a storekeeper at Walgreens. It was a good job, he says, but over time he realized that without a college degree he didn’t have many options. “I was dependent on the business,” he says.

Garish was fortunate enough to be able to afford to go back to college and complete his education, but he knew many of his frontline colleagues didn’t have that luxury. “This life lesson had an impact on who I became as a leader,” he says.

The cost of becoming a veterinarian

Today, Garish is president of Banfield Pet Hospital, the largest general veterinary practice in the United States, with more than 3,600 veterinarians working in 1,000 hospitals. Shortly after joining the organization in 2015, Garish and his team reorganized their organizational strategy, establishing a new roadmap that included programs to improve the health and well-being of employees. From the start, he knew that these efforts had to include financial well-being. “Financial health is a problem for everyone,” he says.

Rather than making assumptions about the financial support employees wanted, her team conducted a series of interviews, focus groups, and surveys to determine the financial issues employees were facing and what would help them alleviate. these burdens.

Associates have always said that student debt is one of the biggest financial obstacles in their lives. “It’s not just the case with Banfield,” Garish said. “Student debt is at the center of the Venn diagram for vets, industry and society.”

Dr Kirk Breuninger, vice president of the veterinary quality division for Banfield, agrees. When he graduated from veterinary medicine in 2010, he had $ 250,000 in student debt to pay off, which meant he had to put his life on hold to find a way to pay it off.

“My story is similar to that of a lot of veterans,” Breuninger says. “You can’t buy a house or a car until you have your financial plan in place. “

And the problem was only getting worse. Their research found that veterinarians’ student debt grew larger as public funding for education dried up. In 2015, the average debt-to-income ratio of recent graduates was over two to one. “We saw this as an opportunity to help support our associates,” says Breuninger.

Three-pronged approach

The team in charge of defining the new program, which included Breuninger, came up with 19 different program ideas, then presented them to the associates and asked for their opinion. Initially, vets were primarily interested in obtaining a monthly financial allowance to help them pay off their debts. But the team knew they could do more. “We wanted to use our size and scale to do a good job on behalf of our people,” Garish says.

Research has shown that high interest rates are a big part of the debt repayment burden. Banfield therefore partnered with a financial institution that agreed to offer an additional 0.25% interest rate reduction to all Banfield associates who used them to refinance their student loans.

Banfield then combined the refinancing option with a monthly student loan repayment contribution of $ 150, covering all taxes associated with that additional income. The company also provides $ 2,500 for debt repayment to any student who participates in an internship at Banfield, a summer job or a volunteer activity on campus. They see it as a way to attract students to Banfield and get them to start repaying their loans.

The three-pronged program has received rave reviews from veterinarians and Banfield executives.

$ 15 million invested

Dr. Alea Harrison began participating in the program when it launched in 2017, and it had an immediate impact on her quality of life. She was pregnant with her second child, and even though she had graduated from veterinary school 11 years ago, she still had a mountain of debt to pay.

“When I heard about this program, it gave me great peace of mind,” she says.

The program put her in touch with a debt advisor who guided her through the refinancing process. She was able to reduce her monthly payment by almost $ 600, on top of the monthly allowance of $ 150 she receives from Banfield. “It was a huge saving,” she says.

And when COVID-19 lowered interest rates, his advisor found him on even better terms, which further reduced his payments.

Harrison is not alone. Almost half of the veterinarians at Banfield Pet Hospital now participate in the student debt repayment program and see similar savings. To date, Banfield has cumulatively contributed nearly $ 15 million to help his vets pay off student debt and has facilitated over $ 16 million in student debt refinancing for associates.

Harrison sees the program as a demonstration of Banfield’s commitment to its employees. “It shows me that they are listening to the needs of their associates and that they are ready to make changes and investments to meet our needs.”

Develop knowledge through retention

Garish and Breuninger see the debt relief program as an extension of Banfield’s commitment to employee education. The company also funds continuing education events and invests in partnerships with universities to support veterinary technical training and other career programs in the industry.

“At the end of the day, we’re trying to create an environment where someone can come in, even fresh out of high school, and develop the skills necessary for a career at Banfield,” says Breuninger.

These investments are paying off. Over the past five years, Banfield’s turnover rate has been cut in half. This not only lowers the costs of recruiting and onboarding, but it has also created a more competent and knowledgeable staff, Garish says.

He notes that in the past, veterans have spent much of their time teaching new recruits the basics of Banfield procedures, operational standards and workflow. “Now our leaders are spending more time teaching advanced skills and having more impactful conversations about the state of pet care,” Garish said. “This improves the dynamics of the workplace and results in stronger and more efficient teams. “

It also helps them attract great candidates. In a recent survey of new hires, two-thirds of applicants said the student debt relief program played a role in their decision to join the company.

“Student debt is a burden on mental health,” Garish says. “When you resolve that burden, it reduces stress, which has a halo effect on an employee’s overall mental health. “

Join the 8 percent

Student debt is a huge burden across all industries, and as the cost of education increases, students are forced to make tough choices about pursuing their academic dreams. Harrison notes that the cost of veterinary training can be an insurmountable barrier for many aspiring veterinarians, resulting in a lack of diversity in the profession. “That’s why there is still a (racial) gap in the veterinary industry. “

Debt relief programs can reduce these barriers and help businesses attract applicants long before they graduate. “It helps us stay competitive,” says Harrison.

Currently, only about eight percent of companies offer student debt relief programs, giving organizations like Banfield an edge over their peers. However, Breuninger encourages other companies to consider similar programs as part of their larger benefit package and commitment to education.

He also advises talking to employees about how student debt affects their lives before starting a program to address it. “Everyone is in a different financial situation,” he says. “These conversations helped us determine what we could do to have the most impact. “