Another thread got me to calculating the cost of warr. replacements. Your costs may vary, but I don't see it as being much different unless your rent and employees work for a lot less...
Rent and electric......$4500 per month = $4.50 per 10 mins.
Shipping to location....$2.00
Shipping back to co....$2.00
Employee @$15 per hr. = $2.50 per 10 mins.
In house lens edging...$2.50 per lens
Interest on capital "loan" to supplier waiting for credit @4% MM rate....33 cents per month per $100.
Using the above criteria to figure costs....
10 mins. time with intial visit of patient with complaint/problem...4.50 rent, 2.50 employee.
10 mins. pulling org. invoice, re-ordering, copying invoice, package and ship product back...4.50 rent, 2.50 employee, 2.00 postage
New invoice shipping cost for replacement ....2.00
Equiptment cost to replace 2 lenses....5.00
10 mins. replacing lens or frame and dealing with patient upon their return to office...4.50 rent, 2.50 employee.
Interest lost on capital...(many times you have to pay for the replacement one month, only to see your credit appear a month later. You essentially loaned your capital out to the lab or frame co. until they credit) $100 = .33 cents per month.
The above totals come out to $30.33. If it is frame only subtract the $5.00 lens process cost drops it to $25.33. If you do 2 warr. replacements a week that adds up to $3154.32 per year on lenses, $2634.32 on frames. Keep in mind there are other costs I didn't list to a practice like insurance.
Warr. work is a fact of life in optical. It's gonna happen. But these figures are out of net, not gross. We should not give this service away. Either incorporate it into initial pricing or charge for it when it comes up. Warranty work is not cheap!
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