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Thread: "Optical Service Stations" owned by optical on-line corporations.....................

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    Blue Jumper "Optical Service Stations" owned by optical on-line corporations.....................

    Quote Originally Posted by obxeyeguy View Post

    Nothing I paid for? How about my education, my knowledge, my experience, I paid for all of it. You guys want to raise the bar,yet name one other profession that gives it services away for free. Even the coffee shop does not give hot water away to make your own tea. Good luck with that bar raising.


    On-line eyeglass buyers get their glasses delivered in the same state as the B&M store would receive it from the lab. Unfinished, non adjusted, no final check = un serviced. The purchasing consumer will sooner or later need the services of a professional optician to get the job right.

    Do you want to be the original combined source for another new type of an optical service ?

    The "Optical Service Station" will give advise and service any type of glasses, on-line purchased or not for a service fee according to their own price list. They will carry a small choice of non brand and inexpensive frames for quick replacements of broken and damaged ones.

    They can be located in a second floor office at cheap rents or even in a kiosk in large mall.
    Their inventory in equipment will be the absolute minimum to check for PD's, finished glasses and the necessary tools for proper adjustments. Any lab technician could do or learn to do such a job.

    With the mushrooming of the on-line optical's, and their ever increasing productivity and sales it is important to weigh this thought seriously before the first of the big on-line optical's is getting the idea to start such a chain of "Optical Service Stations".

    They have the statistics to know the geographic areas where the bulk of their production is sold to and can start at the right places.
    They can even develop the idea of providing live frames samples to these places and you will see a new type B&M store belonging to on-line optical's selling at their price range and pay for their stores with service fees.

    Their other strength is also their power of advertising. Just figure they start advertising for their service stations in every place they have their regular adds.



    Do not file this post as a fantasy. It can and most probably will be reality in the very near future looking at the aggressive way of behavior these companies show.

    What do you say?

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    Quote Originally Posted by Chris Ryser View Post

    Do you want to be the original combined source for another new type of an optical service ?
    Absolutely, unequivocally no!
    Ophthalmic Optician, Society to Advance Opticianry

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    Master OptiBoarder optical24/7's Avatar
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    Let's look at the math;

    Let's say your service draw area is 50k people.(That's a big area!)

    60% wear glasses = 30,000 people.

    Average purchase cycle is 2.5 years = 12,000 people yearly.

    Industry estimates are 1-2% buy eyewear on-line ( 12,000 - 98% = 240)

    You're open 5 days a week = 260 days a year

    240/260 = .92

    So you'll average less than one client a day. Chris, wanna invest in a optical service station?

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    Master OptiBoarder MakeOptics's Avatar
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    Your math is flawed. You're making the assumption that the model remains the same.

    Chris your model is flawed as well, you're renting a B & M getting rid of one of the largest advantages to the online model.

    Assume Chris model is correct sub out with a virtual office used for sales presentations. Now sell this model to the mass of disgruntaled o pticians that work in B & M's. Now these opticians have an oppprtinity to make money which the current optical model doesnt address and the consumer has a professional to see. Its being done already fairly successfully.
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    Quote Originally Posted by optical24/7 View Post
    Let's look at the math;

    Let's say your service draw area is 50k people.(That's a big area!)

    60% wear glasses = 30,000 people.

    Average purchase cycle is 2.5 years = 12,000 people yearly.

    Industry estimates are 1-2% buy eyewear on-line ( 12,000 - 98% = 240)

    You're open 5 days a week = 260 days a year

    240/260 = .92

    So you'll average less than one client a day. Chris, wanna invest in a optical service station?
    continue the Math

    Optician at $50K per year, rent at $12,000 a year (...and no other expenses)

    $62,000 total expenses / 240 adjustments = $258.33 per adjustment if you're a 501 c(3)

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    Master OptiBoarder optical24/7's Avatar
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    Phi, do you think the percentage of eyewear sales on-line will even remotely approach on-line CL sales ( in percentages)?

    CL's, a commodity that has been sold on-line for nearly 20 years and heavily promoted and advertised still is at around 15% of total sales, which includes purchases from their Dr's website.

    The general public has a very different attitude towards eyewear. It's a much more personal item to purchase, a non-commodity.

    I'm certainly not saying e-glasses will go away, and yes, their sales will go up, but not nearly as high as CL's (percentages). In that regard, coupled with our country's aging population and increasing need for vision correction, on-line eyewear sales will effectively be static at some lower end of the scale.

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    Underemployed Genius Jacqui's Avatar
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    I think I'll turn the lab into a One Hour/2 for $69 operation. Could put a dent in the on-line sales, at least locally.

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    Master OptiBoarder optical24/7's Avatar
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    Don't try it in San Antonio Jacqui, you'll have lots of competition. There's a chain that's advertising 2 complete pairs of PAL's for that price. ( And folks think ya need to go to the net to get cheap!)

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    24/7 I seem to recall in some ancient litterature or lecture a statistic that only one in seven individuals require glasses.

    Chip

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    Master OptiBoarder optical24/7's Avatar
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    According to the Vision Council of America, 75% of the population use some sort of vision correction, 64% wear glasses.

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    If these folks aren't going to a "professional" for their glasses, why would they go to one for a measly adjustment? (Not to mention that I wouldn't give 2 cents for the adjustment done by many claiming to be professionals)

    Verification? Who cares if they are correct...so long as you can see "pretty good", and you've still got some money in your pocket?
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    Quote Originally Posted by Jacqui View Post
    I think I'll turn the lab into a One Hour/2 for $69 operation. Could put a dent in the on-line sales, at least locally.
    If you're going to do it around here, you'd better throw in a free eye exam too!
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    Makes me glad I just retired!
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    Master OptiBoarder MakeOptics's Avatar
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    Optical24/7, interestingly you compare eyeglasses to contacts in your model. The only reson for online sales of contacts was the consumer didnt like the cost or process of contact lenses. The margins on glasses is much higher with a greater risk vs reward. If a local outlet were to exist then the risk goes down.

    I think that multifocals are the only saving grace, I would equate them ro GP lenses in the online model.

    Interestingly enough the people that are more likely to buy online are not as price concious as value concious. I would suggest that 5 pair for an equivalent cost to your offices one pair is an easier sale then 1 pair at 1/5 the cost of your offices pair.

    In essence the model i think would be an eyewear wordrobe for the equivalent price as one pair of a B and M. The marketing practically writes itself.

    Also the local person that offers the service, is effectively placing the order and taking the risk for the consumer. Similar to the local B and M chosing the lab. The online model is really the consumer wanting choice in the lab and product.
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    Master OptiBoarder optical24/7's Avatar
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    Quote Originally Posted by PhiTrace View Post
    Optical24/7, interestingly you compare eyeglasses to contacts in your model. The only reson for online sales of contacts was the consumer didnt like the cost or process of contact lenses. The margins on glasses is much higher with a greater risk vs reward. If a local outlet were to exist then the risk goes down.

    That's been my point for years, there are low cost B&M's across the country, with expansion in that area. With comparable costs to the net locally, the consumer lowers their risk on purchasing what most consider a personal, unique purchase, unlike a commodity. The net will cut into these locations client base and vise-versa, thus the low cost consumer is covered in this sub-market. (low cost).

    I use CL's as an example because it a commodity and vision related. Finding something comparable to eyewear also sold on the net is difficult. It's fairly unique in that. And, at least imho, it shows how small a commoditised product is impacted by online. I don't think the public views the purchase of CL's as personal as eyewear.

    I think that multifocals are the only saving grace, I would equate them ro GP lenses in the online model.

    Agreed, to a point. But you have to also consider the unique personal purchase experience most want.

    Interestingly enough the people that are more likely to buy online are not as price concious as value concious. I would suggest that 5 pair for an equivalent cost to your offices one pair is an easier sale then 1 pair at 1/5 the cost of your offices pair.

    I agree again, but the public equates "price" with "value". Some find value in opticianry services, some will not. (Until they have a problem.)

    In essence the model i think would be an eyewear wordrobe for the equivalent price as one pair of a B and M. The marketing practically writes itself.

    Marketing and reality can be two different things. Once again, some will find their needs *adequately* met by buying sight un-seen, (pun intended). Others will not, even more won't try.

    Also the local person that offers the service, is effectively placing the order and taking the risk for the consumer. Similar to the local B and M chosing the lab. The online model is really the consumer wanting choice in the lab and product.

    Interesting thought. But I don't think they are looking for a choice in lab. Consumers know lens brands? Very few, and most of those whom we mistakenly promoted to the consumer for years (like varilux) are the only trade/brand names I hear from some clients (again, a small percentage.)

    I do predict future fall-out in designer name brands. It's too easy to research online. When ECP's finally get their belly full of being showrooms/try-on rooms for these, they will be looking for other product to stock, or they will have to re-think traditional pricing of these products.

    There are many sub-markets in optical. Online is simply one of them, and a small one at that. How significantly it affects traditional B&M providers depends on the sub-market they (individual B&M's) cater to.

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    Well said 24/7.

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    location, location, location...it's everything to the model.

    Put it in a side street, it will fail.

    Put it in a kiosk in a mall and it will make pretty good money. The Mall of America in Bloomington, MN gets 40 million visitors per year.

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    Master OptiBoarder OptiBoard Silver Supporter Barry Santini's Avatar
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    In unlicensed states, getting "opticians" to become certified "subs" and make extra cash on their day off or eves/weekends by offering such services, either in their home, or "go to" theirs, is a no brainer.

    This, I predict, may happen. And, if online really takes off, you'll see a movement to question licensure in those states as possible "restraint of trade."

    We'll see.

    B

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    Redhot Jumper Online is simply one of them, and a small one at that................................



    Quote Originally Posted by optical24/7 View Post
    There are many sub-markets in optical. Online is simply one of them, and a small one at that. How significantly it affects traditional B&M providers depends on the sub-market they (individual B&M's) cater to.




    The MyOnlineOptical service is an advanced new service from Essilor. The service is dedicated to independent US eye care professionals. Set up your own e-Commerce site in minutes and let your patients place orders for all their vision needs. Increase your revenue, improve your capture rate,
    and reach new patients. MyOnlineOptical will do the rest.




    The established 19 websites that rank below 500,000 on Alexa produce anywhere between 10,000 and 15,000 estimated sales per day. If that is an amount that is justifying a remark as, "Online is simply one of them, and a small one at that."
    Those selling websites have had an increase of 15-20% of visitors, over the last 3 month. That for sure indicates an increase and not a decrease in sales.

    If a company like Essilor officially supports and promotes the system of on-line sales would you call them stupid ? They have never been stupid they are just without shame and highly smart and bet on what they know as being the future and save their investments in optical labs.

    Essilor also owns "Frames Direct" the second largest on-line optical seller worldwide just after Mr Specs out of Germany who has become number one over the last few month.

    Closing eyes and plugging ears to these facts is not the way to go.

    Last edited by Chris Ryser; 04-24-2012 at 04:25 AM.

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    Quote Originally Posted by optical24/7 View Post
    Let's look at the math;

    Let's say your service draw area is 50k people.(That's a big area!)

    60% wear glasses = 30,000 people.

    Average purchase cycle is 2.5 years = 12,000 people yearly.

    Industry estimates are 1-2% buy eyewear on-line ( 12,000 - 98% = 240)

    You're open 5 days a week = 260 days a year

    240/260 = .92

    So you'll average less than one client a day. Chris, wanna invest in a optical service station?
    I have to agree...even with a kiosk in a mall setting, the overhead would be quite high. This concept has already been done in Europe and the results have been lack lustre. Not to mention, building a business on the cheapest of cheap consumers as your target audience is flawed beyond belief.

    Leave it up to Essilor though - they will do it regardless and spin it in their favour.

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    Quote Originally Posted by Barry Santini View Post
    In unlicensed states, getting "opticians" to become certified "subs" and make extra cash on their day off or eves/weekends by offering such services, either in their home, or "go to" theirs, is a no brainer.

    This, I predict, may happen. And, if online really takes off, you'll see a movement to question licensure in those states as possible "restraint of trade."

    We'll see.

    B
    I disagree. I don't think they will be necessary. People will still need ODs to examine their eyes. The OD will examine, the insurance company will supply the eyewear via the internet, and send them back to the OD for verification.

    It's the next logical step for ODs, most of whom will/have turn over their eyewear profits in exchange for the privilege of performing the exam.

    Third party plans started off taking a small percentage of profits, and gradually turned up the heat. Many ODs will have no qualms about handing the eyewear off to someone else.
    Ophthalmic Optician, Society to Advance Opticianry

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    Blue Jumper Chris, wanna invest in a optical service station................................

    Quote Originally Posted by optical24/7 View Post

    Chris, wanna invest in a optical service station

    Let's look at the math;

    Population = 330,000,000
    60% wear glasses = 198,000,000 people.

    Average purchase cycle is 2.5 years = 79,200,000 people yearly.


    If on-line does 2% that would be 1,584,000 pairs of glasses. However their websites have gotten busier at a rate of 20-30% every 3 month, over the last 6 month period. So how much has the 2% sold by on-liners (if it ever was correct) rate changed ?

    You should not look at these figures in a defensive way, but objectively, as you would at a tornado coming your way and get out of the way before it hits.

    The optical retail industry has been targeted by the media and other internet means and the consumer is listening.

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    Master OptiBoarder optical24/7's Avatar
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    Let's keep going Chris;

    There are well over 50k retail optical locations in the U.S.

    1,584,000/ 50,000 = 31.68

    260 work days

    31.68/ 260 = .12 patients per day.


    Other figures;

    Total U.S. eye care market per year; 25 billion dollars

    Percent of this that are eye glasses; 67% = 16.75 billion dollars

    Coastal's eye wear sales (currently); 40 million (annually world wide)

    Let's be generous and say 100% of coastal's eye glass sales occur in the U.S.;

    40M/16.75B = .238% of U.S. market.

    Now, how much will on line grow, and at what point does it become static with no real growth? No one knows this. But we can look at commoditized items to get some kind of indication, hence my using CL sales as an example. I think it to be common sense that eye wear will not reach (in percentages) a number close to CL sales on-line.

    What's the main driving force in on line sales? I think we can all agree, it's mostly price. As I've pointed out here, there are already B&M's close to most of the population that sells eye wear at comparable prices to the net. It's not like there aren't nor have been for many years, locations that cater to the frugal. This is on line's main competition, the frugal market. I would worry more if I was in that sub-market.



    This (at least to me) is not a defensive outlook, but an objective assessment. You can say I have my head in the sand, I can say your's is in the clouds. We'll just have to wait and see, but in the mean time I won't be opening any optical service stations, but you're welcome too. I look forward to hearing how well that goes!

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    Redhot Jumper I can say your's is in the clouds....................................

    Quote Originally Posted by optical24/7 View Post

    Let's keep going Chris;

    This (at least to me) is not a defensive outlook, but an objective assessment. You can say I have my head in the sand, I can say your's is in the clouds. We'll just have to wait and see, but in the mean time I won't be opening any optical service stations, but you're welcome too. I look forward to hearing how well that goes!
    optical24/7..........I like your post, very explanatory but I don't agree with your points.

    I will not be opening any service stations either, but some smart cookie will, if opticians, and selling OD and MDs do not change their ways and charge for services. However I believe that any measures should be seen and planned ahead and not after the fact. I remember OptiBoard members laughing at me when I said that there was going to be a recesssion back 6 years ago, and nobody believed it. Today they tell you that the recession ended in 2009, but...............................

    These days there still over 30,000,000 out of work and about the same amount is on food stamps. One million forclosures planned for 2012, Are these poeple going to buy glasses from B&M stores or from the on-liners at less than half the cost ? That is 10% of the population. Therefore you be loosing 10% of customers, and probably more, unless you cater to a better situated clientele.

    You just don't need any statistics to fugure that out, these are just plain facts. Also their on-line website traffick has gone up drastically which is also a fact, and I do not believe that my head is in the clouds.

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    The kiosk theory in reality isn't really more cost effective or advantageous for an owner or on-line corporation when compared to a traditional brick and mortar facility. To develop a custom kiosk and stock it sufficiently with frames for display will cost between 40-50K. You can be thrifty and open an entire store for that.

    Although super small square footage, 150-300 sq ft at $30.00 per sq ft+ in a busy mall is reality - Mix in long mall retail hours - 9-9 M-F and weekends - you will now have to hire additional staff for volume and optician or risk dying of exhaustion.

    Unloading/loading all of your stock daily...and not to mention, who's going to guard the fort when you have to go for a coffee or pee?

    Similarly, both Essilor (in UK) and Hoya (in Asia) are vertically integrated to the consumer level like Luxottica is globally and corprately own/operate large retail stores in malls, kiosks are way too small. If the on-line eyewear popularity continues to rise, we will all be competing with our own vendors disguised as big box retailers - it's already begun!

    Essilor is strategically aligned with and already supplies to Costco and Wal-Mart, and they continue to purchase shares ownership (partial or not) with whomever they can.

    These large companies will continue to fight and obtain market share at all costs, customer loyalty to the smaller independent just doesn't exist in their vocabulary.
    Last edited by eyemanflying; 04-27-2012 at 06:05 AM.

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