Reach for Excellence

Market Opportunity: Tap Into a Growing Market for Optical Goods

Dec. 14, 2016

The market for vision care products and services has grown by 2.2 percent compared to the previous 12 months, according to The Vision Council VisionWatch 2016 third quarter Member Benefits Report. The market for vision care products and services, including all types of ECP retail locations (including independent and corporate ODs), generated $40,253.3 million in the 12 months ending in September 2016, compared to $39,385.7 million in the 12 months ending in September 2015.

According to the findings from The Vision Council VisionWatch 2016 third quarter Member Benefits Report, 2016 is up 2.2 percent over 2015. Inflation for 2016 was approximately 1.6 percent, so if the economy seems flat, these numbers suggest it is.

There were bright spots in the report. Contact lenses were up almost 5 percent. That’s a good thing.

There were some interesting items reported, such as about 75 percent of the U.S. adult population wears some sort of vision correction. That trend will continue, so as our population grows, the number of people in some type of vision correction will also grow.

Another interesting fact is that we’ve not yet fixed the contact lens drop out problem that happens around age 34. That problem still needs attention.

As much as we like to drill down into information wells like this report, we need to move forward. The important question is how much growth did your practice experience in 2016, and what do we need to do to make the practice better next year? Here’s an outline of a plan to do better in 2017 than you did in 2016. Fill in the details now to implement your plan on Jan 1.

Increase Revenue

1)    Doctors, prescribe in the exam room what the patient needs to increase their quality of life at home, school, work and play.

2)    Increase your fees on services and materials not covered by third parties.

3)    Create a plan to increase your number of multiple-pair sales.

4)    Create a plan to sell more annual supplies of contact lenses.

5)    Get your current patients to return more frequently by implementing a pre-appointment system.

6)    Decrease the number of patients who walk with their prescriptions by merchandising your frames. The number one question in a patient’s mind entering your optical is: can I find here what I need? Use signage to answer the question. Stand at the door to your optical and see if the question is answered without having to search.

7)    The end product of external marketing is new patients. The end products of internal marketing are: current patients returning, increased revenue per patient and your current patients actively sending you new patients. Tune up your marketing engine to make sure all four cylinders (one external and three internal) are functioning at maximum levels.

Manage Your Expenses Better

1)    Get better prices on your frames, lenses and contact lenses. Get your COGS to 25 percent. Join an alliance or a buying group if your revenue is not enough to get great deals yourself.

2)    Take control of your frame boards. Measure what you are actually selling versus what you have displayed on your frame boards. Remix your frame board to more accurately reflect what is being purchased. (Get rid of the dogs.)

3)    Make sure every staff member understands exactly what they produce for the practice. Get them to count the number of end products they create each day and report that number. Use your office meetings to help staff stay focused on being in control of the number of end products they are to produce. (Example: the end product of recall is a patient in the chair. Everything else that staff members does is just process to get to the end product. If the end product is not happening, then the process must be changed.)

4)    Get control of your overhead. Work so that overhead is less than 10 percent. Implementing a purchase order system may help.

Don’t forget to measure to manage. Don’t rely on feelings – measure. Look at your numbers at least once a month. Create, or buy, a business dashboard for your practice. When you look at the numbers, make adjustments to make the numbers even better.  

The past year is now history. We cannot go back and change history, but we can learn from history and make the future better. Today is the day to plan for a better new year. Then, once you have a plan, live each day in present time working your plan.
 

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