long post, love some feed back tho

[chaoticneutral]

Hey there optiboard goers,
So, this happened the other day I wonder how you might handle the same situation.
We have an office policy which states ~ Purchase one complete pair of glasses get the second complete pair of glasses at half price. ~ We accept this as canon in the office among other rules and regulations.
We are able to offer this discount because the lab we use extends to us a similar discount that we in turn extend to the patient. If we purchase 2 pair of lenses for the same patient (some restrictions apply) we get 50% off the order if it’s for the same patient. This is an important point as you will see later.
A patient came in and purchased a complete pair of glasses out of pocket with no insurance benefit.She then wanted to purchase lenses for her sun-glass frames that she purchased in Spain.She asked if we had any deals or specials that we could offer for this second purchase. I told her that with a second purchase of both frame and lens we could offer her 50% off of the second pair. She did not want to purchase a second frame because she already had a very nice frame that she purchased elsewhere.I told her the price of the second pair of lenses without the purchase of the frame.She did not want to spend that amount on the lenses themselves but asked if we could extend the curtest of a second pair at 50% off for just the lenses.I told her that although I neither had the power nor authority myself to make that decision but I would gladly ask the assistant manager. She then noted that if we could not reduce the price for the second pair then she was not interested in purchasing them.
Well, sais I. An interesting quandary.
Here’s the ~IF, THEN~ statement. IF the manager approves the sale and extends the 50% off courtesy to the customer, which is outside of the rules set in place, THEN we capture extra revenue AND the customer has a positive experience. If not, then the rules have been preserved and the environment that we work in remains sterile with the sanctity and purity of our beloved dogma intact.
Ill tell you what happened and then pose my question. I thought to myself ~Self, here is an opportunity to make more money for our master! We cants ever have too much money can we precious, no we cants! I told the customer I would gladly champion the cause to the assistant manager. As I was speaking to the assistant manager about the situation, she was shaking her head no, until I finally conveyed the full message and then she barked NO and was quick to point out that the customer did not purchase a frame. I quickly reminded her that the lab offers us a discount for the second pair regardless of a frame purchase and we would capture additional revenue from the sale if this was approved. She said WELL I’LL HAVE TO THINK ABOUT IT. I told the customer I would let them know that the management’s decision was regarding the second pair in the afternoon. Later that day when I asked what her (the assistant managers) decision was, the assistant manager told me that we had already made three “deals” this week and we can’t keep doing things like this but she did approve it.
The questions then are ~ Do you bend the rules when it is advantageous to capture additional revenue? Should employees be encouraged to find ways like this to create more sales? Should employees be discouraged from rule bending? Should employees question managements decision once spoken when the result ends in both profits and customer satisfaction? Should this employee been given positive feed back from management for dynamic, outside of the box thinking that generated more revenue for that sale?
In addendum to this situation, the very next sale was a similar situation where the patient had flex money to spend and needed a second pair of lenses for a frame that she already purchased from us. The 50% discount was not offered in this situation and was not asked for by the patient. The patient was satisfied that her flex spending money was used before it was lost and all was well.
A second set of questions arise from this pertaining to both situations: Is this a model of thought that employees should be aware of? Is it unscrupulous to ask management for a discount for one patient if they request it , but not make the second patient aware of the discount for the same situation?
Thanks for listening and sorry for the long post. I'd love some feedback.
Kindest regards,
Eric

[jc17777]

At my office what we do is a compromise. If the lab is giving you the discount anyways then what I would offer personally is 20-25% off 2nd pair just lenses in their own frame if they decide to go that route and keep the 50% off 2nd pair for a complete pair purchase. If certain patients keep getting special treatment like that tho they word will spread and you will either have more patients coming in asking for the same treatment or ones that didn't get that treatment coming back upset. Thats why there should be a standard that is not usually deviated from IMO

[Johns]

~ Do you bend the rules when it is advantageous to capture additional revenue?A second set of questions arise from this pertaining to both situations: Is this a model of thought that employees should be aware of? Eric

Bend the rules?? I bend them, twist them, dip them in chocolate, drive over them with my truck, slide them under the door, and run them up the flagpole! Are you kidding???!! I'm here to make money, not rules!

[peyes]

Bend the rules?? I bend them, twist them, dip them in chocolate, drive over them with my truck, slide them under the door, and run them up the flagpole! Are you kidding???!! I'm here to make money, not rules!

Well said! Been my policy for 35 years.

[mervinek]

Bending the rules is fine if you are the manager or owner...but if you don't have the authority and the people that do are out of the office or unavailable, there has to be some kind of standard to go to. The optician needs to know what to do in that situation. Patients are always going to come in and ask for whatever discount or special they can. It should be expected and the optician in the front line needs to know if, when and how much to bend the rules! Remember too that people talk. You bend for one and their friend is going to expect that too. It helps to be prepared.

[rbaker]

The ideal employee is one who does not need rules or company policy to meet the goals of the company. Just hire talent, tell them the goals, give them the tools to meet those stated goals and turn them loose.

If you need a lot of rules to guide you in your day to day labors you are working at a higher pay grade than your capabilities.

[mervinek]

The ideal employee is one who does not need rules or company policy to meet the goals of the company. Just hire talent, tell them the goals, give them the tools to meet those stated goals and turn them loose.

If you need a lot of rules to guide you in your day to day labors you are working at a higher pay grade than your capabilities.

I agree. However in our office, giving a discount and bending the rules is grounds for dismissal. Every office is different. Like you said, it is giving them the tools to meet the goals that is the key. Trying to meet goals while having your hands tied behind your back can be difficult!

[newguyaroundhere]

We had a similar situation here about a month ago. Lady bought a pair of glasses from us. She knew what our policy required. She had mentioned that she had frames she had purchased elsewhere and wanted lenses mounted into them.....12 pairs of frames to be exact. We notified management of the situation and they signed off on the discount for her.

Yes there are "rules" in place but as others have mentioned, you sometimes have to bend, twist and manipulate the rules if it means making your patients and customers satisfied.

[drk]

I'm in the rules camp.

I've been burned quite hotly by not being consistent.

If you think out the plan, then you can enforce it with confidence.

For example, "bargaining" is not a good reason to give out a discount. It should be as an "incentive". Unless you like haggling and want the office to have that kind of approach (and nobody in their right mind wants to work like that or even shop like that...think car sales), it's way better to set the rules and be consistent.

I don't want to incentivize lenses only orders. I want to incentivize complete pairs.

[Johns]

I guess the secret is to limit the rules then. I like to think that my employees are empowered to to be able to do whatever they need to to make the patient as happy as possible. It doesn't always come down to money and discounts; it may be using some extra resources to go the extra mile such as a delivery, buying pizzas for a local safety account, giving away some Oakleys to the baseball coach...whatever it takes.

[Paul Smith LDO]

Rules are rules and without them we have chaos. That being said, institute another rule for a second set of lenses only and offer, say a 25% discount.

[Dr. Bill Stacy]

I think 50% off is way too much, indicating to the patient that our 1st pair price is double what it could or should be. The only thing worse is the 2nd pair free deal which says clearly that the first pair isn't worth much at all. We allow what is "normal" for the VSP world. 20% on the second COMPLETE pairs only.

[chaoticneutral]

I think 50% off is way too much, indicating to the patient that our 1st pair price is double what it could or should be. The only thing worse is the 2nd pair free deal which says clearly that the first pair isn't worth much at all. We allow what is "normal" for the VSP world. 20% on the second COMPLETE pairs only.

A fair point, but as mentioned the lab gives us a discount on the second pair (some restrictions apply) that management graciously extends to customers that do not have insurance and are paying for out of pocket.

[cowboytelemark]

~Self, here is an opportunity to make more money for our master! We cants ever have too much money can we precious, no we cants!

I am in this camp too. My office has a really weird dynamic. Basically, I am given autonomy to give patients incentives or discounts or whatever you want to call it when I feel it will either make an otherwise difficult sale, or just to thank a loyal patient for dropping a bunch of coin at our business. BUT, there is some sort of invisible line here, and I have upset both the office manager and the doctors on several occasions. So, I think guidelines should be clearly established and adhered to. But those guidelines should probably allow some wiggle room. I think a 20% off second pair discount, lenses only or complete pair, is a very happy balance. We have a great profit margin (considering the 50% lab discount), and the patient is happy that they saved some money. I just got in an argument the other day with our office manager- she claimed that we had lost money on a second pair discount. My math clearly showed that we netted almost 250.00 on the sale. However, what she meant was that she need the profit margin to be higher because the optical sales needed to float the business. It is a matter of perspective- I would rather have a lower profit margin and more happy customers than a few customers that were suckers enough to pay full price. That said, if someone is going to buy something anyway and you give them a discount, you just are throwing money out the window.

[Johns]

My math clearly showed that we netted almost 250.00 on the sale. However, what she meant was that she need the profit margin to be higher because the optical sales needed to float the business.

What a total genius of a manager! Toss a $250 net profit away because it wasn't a $300 profit sale! BRILLIANT! I hope this person is at your practice for a long, long, time. Better at yours than at mine!

[Craig]

I actually laughing aloud reading about the chaos created by your "bogus" pricing stratergies; we have a fair price and that is it.
Our asked for discount is 10% off once you spend $5,000 at one-time! We have used it once on a 2 Maybach sale in 2 years; our large clients never ask for a discount and we give them gifts for thanks and not cash off. We deliver flowers for birthdays, send thank you notes written by hand and make sure we tell them they are appreciated. We buy and give away leather goods from Maybach as a Holiday or birthday gift but no discounts! The 4 place travel case retails for $850 and we gave away 6-8 of them plus smaller $160 Iphone cases and card holders to match in leather.

If you are beholden to the insurance gods than you have already lost control of your business and let the buyer fight for the best deal of the day!

Anyone who has to use $ to negotiate has failed to deliver a unique enough service to justify

[Dr. Bill Stacy]

I think there is no difference between slathering presents on your "large clients" (whatever that means, big, fat, rich or powerful?) is the same thing as offering a discount. I can understand not offering discounts to everyone, since that can undermine those of us who want the maximum we can get from insurance companies. You are operating in a rare niche for sure, or you are turning away huge numbers of great patients who happen to have vision insurance. Most people with vision care will not go off panel for their annual pair of glasses. This includes people of money who would view that as throwing money away, and they would be right. And there are plenty of uninsured with lots of money who demand a discount or they will take a hike. Especially where there are ethnic groups who are accustomed to a bazaar style of purchasing large ticket items. So your demographics allows you to be smug about opting out of all insurance and refusing discounts on purchases below 5K, but across the USA the demographics don't allow practitioners to make much of a living following your recipe.

[Craig]

I think there is no difference between slathering presents on your "large clients" (whatever that means, big, fat, rich or powerful?) is the same thing as offering a discount. I can understand not offering discounts to everyone, since that can undermine those of us who want the maximum we can get from insurance companies. You are operating in a rare niche for sure, or you are turning away huge numbers of great patients who happen to have vision insurance. Most people with vision care will not go off panel for their annual pair of glasses. This includes people of money who would view that as throwing money away, and they would be right. And there are plenty of uninsured with lots of money who demand a discount or they will take a hike. Especially where there are ethnic groups who are accustomed to a bazaar style of purchasing large ticket items. So your demographics allows you to be smug about opting out of all insurance and refusing discounts on purchases below 5K, but across the USA the demographics don't allow practitioners to make much of a living following your recipe.

The best part is that you don't see the difference and you are in the race to the bottom with VCP's. Why do you charge a different net fee to a client depending on who gave you the business lead for a large discount? We don't think that is fair at any demographic. Giving a larger discount to those who ask the loudest is one way to do it or you can have a system that empowers your employees to make decisions based on logic that produces win/win for all clients and not just those with a discount card.
What will you do when the first eye-wear option is on-line and then you a second-third choice?

[Barry Santini]

i'm in the rules camp.

I've been burned quite hotly by not being consistent.

If you think out the plan, then you can enforce it with confidence.

For example, "bargaining" is not a good reason to give out a discount. It should be as an "incentive". Unless you like haggling and want the office to have that kind of approach (and nobody in their right mind wants to work like that or even shop like that...think car sales), it's way better to set the rules and be consistent.

I don't want to incentivize lenses only orders. I want to incentivize complete pairs.

+1

b

[Dr. Bill Stacy]

The best part is that you don't see the difference and you are in the race to the bottom with VCP's. Why do you charge a different net fee to a client depending on who gave you the business lead for a large discount? We don't think that is fair at any demographic. Giving a larger discount to those who ask the loudest is one way to do it or you can have a system that empowers your employees to make decisions based on logic that produces win/win for all clients and not just those with a discount card.
What will you do when the first eye-wear option is on-line and then you a second-third choice?

That "race to the bottom" crack is just silly. If I were in a race to the bottom, I'd take Spectera, Davis vision, and Medical Eye Services. I never took on Spectera, and dropped Davis years ago. I dropped M.E.S 2 years ago. I still take VSP, EyeMed, Superior Vision and Medicare. I also stopped taking MedicAid because I have no frames to offer on that plan, and because there are few MedicAid patients in my area.

I charge the same fee for everyone, and of course adjust the patient share by any contractual agreements that the plans I take require. I dropped off some local safety glass plans because of their low professional fees and formed my own plan to help companies that have to provide Rx safety eyewear under OSHA. My plan nets me approximately 10X the paltry $15 dispensing fees some of those bottom feeders pay.

Hardly a race to the bottom. I'll be happy to divulge how much I make on the above plans privately. I'm not saying that there is no race to the bottom, but not everyone who takes any insurance plan is participating in that race.

Not sure what you mean by the "first eye-wear option" is on line, but I have been participating in VSP's Eyeconic system. Still evaluating that, but so far I'm ok with it because at least it provides decent reimbursement for the little services I'm expected to provide on it. AND Eyeconic will handle all remakes/refunds/etc completely including the paper work, shipping and handling both ways, etc. I don't see how that will survive, but they are trying.

[Johns]

[QUOTE=Craig;520781] Why do you charge a different net fee to a client depending on who gave you the business lead for a large discount? QUOTE]


Actually, we are all in the same camp, otherwise, you would be giving the Maybach gifts to everyone, and not just the high ticket spenders. I just gave away close to $40k in discounts this morning, but in return, am exclusive provider to 3 regional police/sheriff/ safety departments in the area.

I think we all do it, but at the higher end, it smells a little better; the lower end, you have to do more, and feel like showering after, but it's all good.

[CME4SPECS]

Craig, you can go ahead and keep all those gifts. Show me the money! Years ago some frame companies used gifts as incentives to purchase x number of frames, I told them to keep their gifts and give me the discount and I will go buy my own "gift"!

I actually laughing aloud reading about the chaos created by your "bogus" pricing stratergies; we have a fair price and that is it.
Our asked for discount is 10% off once you spend $5,000 at one-time! We have used it once on a 2 Maybach sale in 2 years; our large clients never ask for a discount and we give them gifts for thanks and not cash off. We deliver flowers for birthdays, send thank you notes written by hand and make sure we tell them they are appreciated. We buy and give away leather goods from Maybach as a Holiday or birthday gift but no discounts! The 4 place travel case retails for $850 and we gave away 6-8 of them plus smaller $160 Iphone cases and card holders to match in leather.

If you are beholden to the insurance gods than you have already lost control of your business and let the buyer fight for the best deal of the day!

Anyone who has to use $ to negotiate has failed to deliver a unique enough service to justify

[obxeyeguy]

[QUOTE=Johns;520789]

Why do you charge a different net fee to a client depending on who gave you the business lead for a large discount? QUOTE]


Actually, we are all in the same camp, otherwise, you would be giving the Maybach gifts to everyone, and not just the high ticket spenders. I just gave away close to $40k in discounts this morning, but in return, am exclusive provider to 3 regional police/sheriff/ safety departments in the area.

I think we all do it, but at the higher end, it smells a little better; the lower end, you have to do more, and feel like showering after, but it's all good.

Gave away 40k? I prefer to think of it as 400k more in the door, as I know you do too. Many of us don't practice in Uber money cities and can treat the bargain hunter like cr#p. I'll take what they have to spend, and always make money doing it. Also, I sleep fine at night, may have helped someone, and still made a couple bucks. I live in a county with a median household income of less than 30k, so the 5k "free gift" Eyewear is off the table.

Like the older cops and fireman, remember why we do this.

[chaoticneutral]

This is an interesting discussion I like where its going. I have another set of theoretical questions to pose. A customer walks in the door and needs a pair of bifocals. He is wearing a frame that is clearly broken, repaired, broken, repaired, and still broken. The cost for a pair of lined bifocals in your store including a budget frame is $150 (made up number prices vary). This customer has 115$ cash to put toward a pair of new glasses. Would you allow your employee's autonomy enough to decide to accept that as a transaction. Would you require managemental intervention to make that decision. Would you turn that offer away altogether?

[Java99]

Bend the rules?? I bend them, twist them, dip them in chocolate, drive over them with my truck, slide them under the door, and run them up the flagpole! Are you kidding???!! I'm here to make money, not rules!

Yup. This.