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Thread: start-up considerations

  1. #1
    OptiBoard Professional OptiBoard Silver Supporter elaneo's Avatar
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    start-up considerations

    Hi i understand the purpose of a business plan and how important it is, but i was just wondering if there is anything im forgetting such as hidden/unexpected costs.

    inventory, rent, untilities, internet/phone, renos (if needed), advertisement.

    I am trying to start up a business in about 1-2 years and am gathering info now. ie. asking Px's how they found us and what they like etc. looking at different lab prices (i will be outsourcing in the beginning) and frame designers. i have looked at many posts about prodesign and would like to build my product around brands like this. most in my area carry lux and safil, but i like colous and giving the customer a good selection.

    I would like to know any tips or good info to follow from those that have succeeded in planning and running their optical business. I realize that a business plan will roughly give me the amount i will need for expenses, and sheets such as cash flow, but i would like to (if any idea) of a mid range-high end store (frames 200-500), not too big, seding jobs out for now (hopefully if all goes well purchase lab equipment)

    ahhh, i know im all over the place, but any posts are greatly appreciated!
    Thank you again!

  2. #2
    Rochester Optical WFruit's Avatar
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    Contact any local small business assocaitions in your area. While the advice may not be specific to optical, it will surely help on the business end.

    There's another thread on this somewhere with good advice in it as well, let me see if the Search function will be my friend today.

    Yes, found it! The Search function is my friend today. Must be a towel thing.

    While this start up is in the US, a lot of the advice is still useful.
    http://www.optiboard.com/forums/show...small+business
    Last edited by WFruit; 05-25-2010 at 12:10 PM. Reason: found it!
    There are rules. Knowing those are easy. There are exceptions to the rules. Knowing those are easy. Knowing when to use them is slightly less easy. There are exceptions to the exceptions. Knowing those is a little more tricky, and know when to use those is even more so. Our industry is FULL of all of the above.

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    OptiBoard Professional OptiBoard Silver Supporter elaneo's Avatar
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    hahah thanks, ya ive been trying to find some info on here as well, but i havent found like a $$$ amount. ive finished a business plan in school, like i was going to make it for my own store, but im sure my numbers are a little off. its a whole different story when you actually have the capital and say youll buy and edger and other lab equipment, and not have the capital and are not using a lab and considering outsourcing and what not. really right now im planning and trying to save money so i may start up ASAP.

  4. #4
    Manuf. Lens Surface Treatments
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    First and most important investment is .................................get smaller belt with with plenty spare holes to make it smaller.
    First 4-5 years is the survival period

    ................and the take it from there.

  5. #5
    OptiBoard Professional OptiBoard Silver Supporter elaneo's Avatar
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    sorry im not so sure i follow.

    and i am helping run an independent's store right now. and have learned a lot so far. as far as lab work and what not, im pretty fresh from school so i know that part.

  6. #6
    Rising Star OptiBoard Silver Supporter
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    What everyone forgets and why so many small businesses fail your initial build-out. Make a design figure if your making or buying displays. All this cost money and you have none coming in (you've quit your job patients don't know about you ect.) This is all up front money.

  7. #7
    Master OptiBoarder
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    You are not ready.

    When you have saved what you think your start up costs will be, start saving some more.

    When you have 3-4 years *salary/living expenses/emergency fund* saved over and above what you think you may need to start, you may be ready to get serious.

    When you get serious, you may come to the realization that your money may be much better spent in another business, trade, quality investments, etc.

  8. #8
    Master OptiBoarder
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    Start up costs for newbies who may not know better:

    $60,000-$80,000 maybe even more considering the type of product that you want to focus on.

    That is before you flip on the open sign!

    Add your 3-4 year salary that you will need to keep you eating and sheltered until the business provides enough money for you to start drawing a salary. That is, if it ever provides enough income to ever draw from!

    Check what rents are in your area. You may be surprised! Just think, you have to cover that just to keep a roof over your shop!

    I suggest that you pay a competent accountant to sit with you before you start too far down this path. See what they say, suggest, etc. Consult an attorney to see what legal fees you are looking at.

    Oh yeah, save, save, save............then.....save some more!
    Last edited by Fezz; 05-25-2010 at 04:13 PM.

  9. #9
    Rochester Optical WFruit's Avatar
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    Quote Originally Posted by Fezz View Post
    You are not ready.

    When you have saved what you think your start up costs will be, start saving some more.

    When you have 3-4 years *salary/living expenses/emergency fund* saved over and above what you think you may need to start, you may be ready to get serious.

    When you get serious, you may come to the realization that your money may be much better spent in another business, trade, quality investments, etc.
    You forgot that he can't snatch the pebble from your hand yet.
    There are rules. Knowing those are easy. There are exceptions to the rules. Knowing those are easy. Knowing when to use them is slightly less easy. There are exceptions to the exceptions. Knowing those is a little more tricky, and know when to use those is even more so. Our industry is FULL of all of the above.

  10. #10
    Master OptiBoarder rbaker's Avatar
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    Quote Originally Posted by Fezz View Post
    Start up costs for newbies who may not know better:

    $60,000-$80,000 maybe even more considering the type of product that you want to focus on.

    That is before you flip on the open sign!

    Add your 3-4 year salary that you will need to keep you eating and sheltered until the business provides enough money for you to start drawing a salary. That is, if it ever provides enough income to ever draw from!

    Check what rents are in your area. You may be surprised! Just think, you have to cover that just to keep a roof over your shop!

    I suggest that you pay a competent accountant to sit with you before you start too far down this path. See what they say, suggest, etc. Consult an attorney to see what legal fees you are looking at.

    Oh yeah, save, save, save............then.....save some more!

    And, on the other hand, one of the most successful opticians that I know started his business with less than $1000.00 back in 1968. He and his family (wife and three toddlers) lived in the back room of the store for the first year. Today, he has a whole passel of stores and is surviving in these difficult times quite nicely.



  11. #11
    OptiBoard Professional OptiBoard Silver Supporter elaneo's Avatar
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    oops --__--;;

  12. #12
    OptiBoard Professional OptiBoard Silver Supporter elaneo's Avatar
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    Quote Originally Posted by Fezz View Post
    Start up costs for newbies who may not know better:

    $60,000-$80,000 maybe even more considering the type of product that you want to focus on.

    That is before you flip on the open sign!

    Add your 3-4 year salary that you will need to keep you eating and sheltered until the business provides enough money for you to start drawing a salary. That is, if it ever provides enough income to ever draw from!

    Check what rents are in your area. You may be surprised! Just think, you have to cover that just to keep a roof over your shop!

    I suggest that you pay a competent accountant to sit with you before you start too far down this path. See what they say, suggest, etc. Consult an attorney to see what legal fees you are looking at.

    Oh yeah, save, save, save............then.....save some more!
    i appreciate the feedback. living expenses food/rent/car insurance/car are not a concern as they are covered.
    ive already looked into rent and it varries from plaza to plaza, 4k-6k per month. (wouldnt consider inside a mall because of the rent and plus they take some % out of the sales too). i dont need a salary as i have said because it is covered. i am willing to put everything into the business.
    the reason why i would like to start it ASAP is that if it fails i know ive tried and at least ill have a lot of time to save for retirement (im 22) and pay w/e off ive used (loans/line of credit) (possibly family loans)
    also i have a friend that is an accountant so that may help im sure. as for legal fees regarding the business i will look into.
    i have also been doing the bookkeeping so im not new there.

    and this 60-80k is considering that there is no in house lab, that the selection is around 400 frames, renov. (of an existing dispensary or new altogether), p.o.p. displays, equipment (lenso, bead tray/blower (ive got tools already)???

    btw i really appreciate the feedback fezz. browsing the forums i see you contribute a lot to many topics. so thank you again for replying to mine.

  13. #13
    OptiBoard Professional OptiBoard Silver Supporter elaneo's Avatar
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    Quote Originally Posted by rbaker View Post

    And, on the other hand, one of the most successful opticians that I know started his business with less than $1000.00 back in 1968. He and his family (wife and three toddlers) lived in the back room of the store for the first year. Today, he has a whole passel of stores and is surviving in these difficult times quite nicely.


    thanks for the success story baker, thats what will help me go through with this venture!

  14. #14
    Master OptiBoarder
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    Why not approach this debt free?

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    OptiBoard Professional OptiBoard Silver Supporter elaneo's Avatar
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    Quote Originally Posted by Fezz View Post
    Why not approach this debt free?
    lol...i would love to, but under the current circumstances....ethics/standards of practice + working/helping a family member runs a business...i feel uneasy...that is how im learning very quickly about what needs to be done when starting a business. plus i would like to offer AR to most patients and not go for the easy non coated lenses or "2 for 1" business

    i have come up with a few promotions that would interest the cusomter. while i believe it is important to have multiple pairs, i dont think we should drill in the mind of patients that "oh i got 2 for 1 before, i should get it again". i feel that that is one of the reasons why ppl dont value the medical device we dispense at all, because we dont value it ourselves. for this sale i think we're thinking what is good for the good of the business which is good...but we shouldnt be getting the patients because of it, but because weve educated them on what is good for them and how glasses/cl work and the fact we provide good service.

    this is 1 reason why i would like to start my own store. and if it doesnt succeed, then so be it, but i will try my hardest to make it happen because were not doing ourselves a service of all these crazy discounts we give.

    this is something i would like to have in my store (god willing i start one)...ill maybe make a little paragraph or some sort of nice display comparing eyewear with things ppl over value.

    ie. a pair of SV with frames well say costs someone in their 20's $500.
    but their cellphone that ppl value so much actually can cost them $600 a year ($50 a month).
    if that person only gets glasses once every 2 years thats $250 a year vs $1200 for 2 years for cellphone service.
    and if you really want to go into the heavy data users well say 100 per month. which is $2400 for 2 years.

    i suppose ppl are shocked by the initial amount that our MEDICAL DEVICES cost. but its because they dont see eyeglasses for what they are.
    do people really value their vision less than their cellphones (especially when we have lan lines or public/home internet use for communication)?
    (probably yes). but its our job to let them know that...and by offering them more discounts i dont think it helps.
    plus by doing that, we need more Px volume to survive. why not be professional and educate the consumer and make them understand why theyre paying that extra $$ for AR coating or polarization.

    but again, thats only 1 reason i would like to start my own business. i would love to start it debt free, but again with my current situation i feel like its worth a shot.
    and really....do you think you can buy a dispensary that is making money off someone that has a good 15-25 years of work left in them...possibly more.

  16. #16
    OptiBoard Professional OptiBoard Silver Supporter elaneo's Avatar
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    dang...i say "good" a lot. i guess when im passionate i dont care much for grammar. =/

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    Master OptiBoarder
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    elano:

    First of all, let me congratulate you on taking the first step in becoming a true ECP, an independent optician. The road of independence is not an easy one..but is very rewarding. You will never stop learning, and the main advantage will be the ability to cherrypick the very best for your clients. That being said, do not be afraid to use the marketing strategies of the large corps...they have their wisdoms too, along with the blatant stupid mistakes. Go for it, you"ll never regret it. The fire in you, whether financial or professional will sustain you through troubles and triumphs.

    Good luck and best wishes!

  18. #18
    Master OptiBoarder
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    Quote Originally Posted by uncut View Post
    Go for it, you"ll never regret it.

    BUT....................will the family and friends that you borrowed from regret it if you
    fail. Will your relationships survive if the business doesn't? How will you manage the stress of running and paying for this business venture? How will you deal with the demands of running a business at a time when many of your peers are out living it up and giving life hell, while you toil away?

  19. #19
    Master OptiBoarder
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    Hey Fezz.....are you sure you're not talking about those corp opticians slaving away on Sunday at the end of a Supermarket checkout line, or in some scuzzy mall wearing that blue uniform?

  20. #20
    Master OptiBoarder
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    Quote Originally Posted by uncut View Post
    Hey Fezz.....are you sure you're not talking about those corp opticians slaving away on Sunday at the end of a Supermarket checkout line, or in some scuzzy mall wearing that blue uniform?
    I am positive! Many of "those" opticians are my closest and most respected friends!

  21. #21
    Ophthalmic Optician
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    Quote Originally Posted by elaneo View Post
    the reason why i would like to start it ASAP is that if it fails i know ive tried and at least ill have a lot of time to save for retirement
    The sooner you begin, the higher chance for failure. Think of the carpentry adage, "Measure twice, cut once."

    Take your time. Don't worry so much about gathering ideas...start gathering "things". The best time to buy something is when you don't need it, so why not start assembling (via e-bay, optiboard, garage sales, auctions, etc..." what you'll need, long before you need them. Buy a $9 crock-pot for a salt pan, pick up some used tools, a sofa table to be used as a dispensing table (I still use mine after 21 years), and other odds and ends that you can pick up with your pocket change. If it is "made for optical" (except for your lensometer!) stay away!

    This is a buyer's market! Sit back and wait for the deals to float by, and grab them when you do. Loans? Why? And who would want to give you money anyway? Get your stuff together, collect some ideas along the way, keep saving your money, and when your ready to do it, make sure you've got a good job at night somewhere, so you can have some money to keep the dream alive, until it takes on a life of it's own.

    Debt? It's a recipe for failure. I'd have been dead in the water after the first 2 years if I was paying on a loan. Don't do it, don't do it, don't do it. Open free and clear, or don't open. It's the only way.
    Ophthalmic Optician, Society to Advance Opticianry

  22. #22
    OptiWizard BMH's Avatar
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    Don't mistake optical experience for business experience.

    Fezz is right on when he tells you to have two or even three times the amount of money YOU think it will take. Being underfunded is the #1 reason new business fail.

    The fact that you are 22 yrs old is not an advantage. You will have a much more difficult time being taken seriously and people will doubt your desire to stick with it for the long haul. Not to mention banks/lenders won't give you a loan unless you have some serious collateral.

    I tried it and failed. Not for lack of experience or desire but for lack of CAPITAL. I opened 3 months before our current recession started (of course I didn't see it coming). I thought I had enough money for two years and I was working weekends somewhere else. I made it through my first year but couldn't risk financial ruin (Wife and two kids to support) so I had to quit.

    Of course it can be done, there are many people doing it now. My main point, HAVE MORE MONEY THAN YOU THINK YOU WILL NEED!
    Properly medicated for your protection.

  23. #23
    Master OptiBoarder
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    elaneo: In all matters of business, support of family and friends is a critical, if not a mandatory requirement. But....never involve family or friends in your business risk. If it fails, and it might, your relationship would never be the same again.

    Fezz: Work hard,,,,,,,,,,,play harder!!!!

  24. #24
    Ophthalmic Optician
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    Quote Originally Posted by BMH View Post
    The fact that you are 22 yrs old is not an advantage. You will have a much more difficult time being taken seriously and people will doubt your desire to stick with it for the long haul. Not to mention banks/lenders won't give you a loan unless you have some serious collateral.
    And why not use your formative years to get paid to make mistakes...that is, learn on someone else's dime, not your own.
    Ophthalmic Optician, Society to Advance Opticianry

  25. #25
    Ophthalmic Optician
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    Quote Originally Posted by uncut View Post
    B]never[/B] involve family or friends in your business risk. If it fails, and it might, your relationship would never be the same again.
    That's the truth!:cheers:
    Ophthalmic Optician, Society to Advance Opticianry

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