Boost sales per patient

September 1, 2010

Optometrists need to begin training staff on retail math through workshops, books or online sites.

This isn't an unusual story. Ives, who sold eyeglass frames for 25 years, said this is a frequent occurrence because most opticians lack knowledge about retail math or strategies.

"It's rampant in the industry," said Ives, now a San Diego-based blogger on http://theopticalvisionsite.com/, a sales and marketing blog that also provides optical news, industry trends, and updates. "The staff may not be aware of retail purchasing strategies that drive profit. They buy based on emotion or what they like, not what is selling."

Key profit driver

"Between 60% and 80% of an optical office's profits are driven by their frame room or dispensary," Ives said. "So it's increasingly important to have staff that is trained to understand basic, retail math like how to calculate inventory turns or basic sales per square foot and increase average sales transactions."

While the standard benchmark for turning full inventory is twice a year, Ives said every optometry practice should target four times a year. So if a practice carries 100 frames, ideally, it should turn those frames four times a year. That's how huge retailers like Costco or Walmart can offer such low prices, she said, adding that buyers should consider their frame board as extremely valuable real estate. Every spot must turn a profit.

But buyers aren't trained about inventory turns, Ives said. If a frame is sold 10 times in 1 or 2 months, that beats the benchmark for inventory turn. Instead of returning those frames because buyers are bored with selling them, they actually need to do the exact opposite-offer other sizes or colors in that same style.

"Never return a product that's profitable," she said. "Any product that is selling at least four times a year should be reordered and restocked. That frame is paying for the optician's salary."

Yet some opticians still resist, claiming that they don't want their customers to see the same inventory when they return. However, Ives said customers don't visit optometry stores every week or month like they do other retail shops. She said they buy frames every 1.8 years, so a practice's inventory will change before their next visit.