What Veterinary Distributor Consolidation Means for Manufacturers: Risk and Reward
The veterinary distribution landscape isn’t what it used to be. Much has changed in a short amount of time.
Over the past two decades, the consolidation of distributors has reshaped the industry, shrinking the number of players but growing their influence.
For manufacturers partnering with these distributors, this change isn’t just a shift—it’s a call to action. The old ways of relying on distributors to push products simply won’t work anymore.
In a market defined by fewer, larger distributors, manufacturers must rethink their strategies, redefine relationships, and take charge of their future.
This week, we’ll take a look at recent mergers and acquisitions, and will provide some real-world practical examples on how manufacturers can anticipate and stay ahead of the changing distribution landscape.
A Timeline of Veterinary Distributor Consolidation
2001
Patterson Companies Acquires JA Webster
Patterson enters the veterinary distribution market by acquiring JA Webster, transitioning from a dental-focused company to a player in animal health distribution.
2009
Henry Schein and Butler Animal Health Supply Form Butler Schein Animal Health
Henry Schein partners with Butler Animal Health Supply to create Butler Schein Animal Health, becoming the largest veterinary distribution company in the U.S.
2015
Patterson Acquires Animal Health International
Patterson expands its reach in both the production and companion animal markets with the acquisition of Animal Health International.
MWI enters into an M&A agreement with AmeriSource Bergen
Meanwhile, AmeriSource Bergen enters into a $2.5B agreement to acquire MWI.
2017
MWI Animal Health Acquires Northeast Veterinary Supply Company (NEVSCO)
MWI extends its regional presence in the northeastern U.S. with the acquisition of NEVSCO, a key player in veterinary pharmaceutical distribution.
2019
Formation of Covetrus
Henry Schein spins off its animal health business and merged it with Vets First Choice to create Covetrus, focusing on integrating distribution with technology solutions.
2021
Patterson Veterinary enters agreement to acquire Miller Vet Holdings
Patterson agrees to acquire Miller Vet Holdings, LLC, a multiregional veterinary distributor
2022
Covetrus Goes Private
Covetrus acquired by private equity firms Clayton, Dubilier & Rice and TPG Capital in a $4 billion deal, allowing the company to refocus on long-term growth strategies.
2024
Midwest Veterinary Supply Acquires Victor Medical
Midwest expands its geographic reach in the western U.S. by acquiring Victor Medical, further consolidating the veterinary distribution network.
2024
Patterson Companies Announces Transition to Private Ownership
Patterson begins its move to private ownership under Patient Square Capital in a $4.1 billion deal, aiming for greater flexibility to implement long-term strategic initiatives.
“Change is not a threat, it’s an opportunity. Survival is not the goal, transformative success is.”
- Seth Godin
Taking Control: How Manufacturers Can Succeed in a Consolidated Market
Stop Expecting Distributors to Do Your Heavy Lifting
One of the most persistent misperceptions among some manufacturers in the industry is that distributor sales reps can be thought of as the manufacturer’s outsourced sales team. While distributors provide vital access to veterinary clinics, their sales reps aren’t dedicated advocates for your product.
These reps manage massive portfolios, prioritize what’s easiest to sell, and focus on high-margin items.
Here’s the reality: distributor reps open doors, but you need to walk through those doors together. Manufacturers must take ownership of their product’s success by educating clinics, generating demand, and providing post-sales support.
Build Direct Relationships with Customers Without Abandoning Distributors
Manufacturers often confuse direct relationships with direct sales, but the two are not the same. By focusing on direct relationships, manufacturers create pull-through demand, making it easier for distributors to prioritize their products.
Direct sales bypass distributors entirely, which can strain partnerships and limit market reach. Direct relationships, on the other hand, complement distributor efforts by fostering trust, loyalty, and demand among end customers.
Direct Relationships: These involve engaging directly with clinics, corporate groups, and large hospital networks to educate them on your product’s value and understand their needs. Strong relationships make clinics more likely to request your product from distributors.
Direct Sales: While this model may work for certain niche or high margin products, it bypasses distributors altogether and can alienate important partners. For many manufacturers, direct sales are not the best approach for themselves or end user customers.
Empower Your Sales Team to Lead the Charge
In a consolidated market, your sales team plays a pivotal role in creating connections and generating demand. Their job goes far beyond simply closing deals.
Educate the Market: Host demonstrations, webinars, and in-person visits to showcase your product’s value. Equip clinics with the knowledge they need to see its benefits.
Collaborate with Distributors: Treat distributor reps as partners by providing them with training, marketing tools, and support. Help them see why your product stands out.
Engage Corporate Groups: Build relationships with centralized decision-makers in large veterinary organizations to ensure your product is on the radar.
Offer Superior Support: Clinics value direct communication with manufacturers who provide exceptional post-sale support, training, and ongoing updates.
Differentiate Your Product or Technology to Stand Out
Consolidation has made the distributor catalog more competitive than ever. To succeed, manufacturers must focus on clear, measurable differentiation. What makes your product unique? Why does it matter to clinics? How does it solve their specific pain points?
Differentiation can take multiple forms, but the most effective strategies often fall into three categories: unique differentiators, comparable differentiators, and holistic differentiators.
Using these types effectively can create a strong, multi-layered value proposition that resonates with both distributors and end customers.
Unique Differentiators: What Sets You Apart
Unique differentiators are what make your product one of a kind. These are the features or benefits no competitor can replicate, making your offering stand out in the distributor catalog.
Examples of Unique Differentiators:
A point of care diagnostic device with an AI-powered algorithm that no other competitor has.
A completely contactless veterinary monitor
Patented technology with a unique mechanism that competitors cannot legally replicate or reproduce
Comparable Differentiators: How You’re Better Than the Competition
Comparable differentiators highlight areas where your product outperforms others in the same category. These aren’t necessarily unique features, but they showcase why your version is the superior choice.
Examples of Comparable Differentiators:
A product that offers superior battery life compared to similar models in the same price range.
Software with a payment processing function that has lower transaction fees than its competitors.
Equipment with a longer warranty than competitors.
Holistic Differentiators: Why the Whole Is Greater Than the Sum of Its Parts
Holistic differentiators look beyond features and benefits and instead emphasize unique things about a particular company that instill a sense of trust and confidence.
Examples of Holistic Differentiators:
A manufacturer having a strong financial position which guarantees 10% of annual revenue going towards long-term research and development efforts.
A company that partners with a charity to give back to the community.
A supply chain that focuses on sustainability
The Path Forward
Distributor consolidation is here to stay, and its impact on the veterinary industry will continue to grow.
But this isn’t a death sentence for manufacturers—it’s an opportunity to evolve. By taking ownership of their strategy, building meaningful customer relationships, and working smarter with distributors, manufacturers can thrive in this new landscape.
The question isn’t whether you can survive distributor consolidation. It’s whether you can adapt and succeed. What’s your strategy?
