Industry benchmarks help optometrists maximize their profit through different product sales. Eye-wear and contact lenses hold 61 percent of the optometrist gross revenue with eyewear sales alone accounting 43 percent. The Median Gross Profit margin on an eyewear sale is 61 percent and as we see the eyewear market expanding we would be seeing an increased profit for the optometrists. For optometrists to maximize the optical profit margin they have to keep the acquisition cost of the eyewear goods to a healthy optical profit margin. The buying and selling of such optical goods the physicians must be active participants to maximize the profit margin.
Delegating the frame buying to different types of frame representatives will mean you lose out on the profit margin and the commission is distributed among many. A sales representative will lack in the kind of connection you have to sell for a frame.
Know The Demographics Of Your Practice Patient Base
An optometrist should know about the needs according to the demography of the region. What kind of glasses do they want? What type’s frames suit their preference? Your inventory should have all the frames that are appropriate for the patients situated in your demography. Sometimes it’s easy that an optometrist conducts a thorough review of the number of frames sold in a month to predict the demand for frames according to the month of the year. The review will also give you an insight on the patient age.
Frame Buying From The Vendors
A move will make your account stand out because the higher the sales volume from a given vendor more the privileged you’re. This will help you in going through a deeper discount for your buys. Frame manufacturers maintain the quality of the frames same throughout and the design also comes with same uniqueness which your customers might find very effective. It’s off to experiment with the vendors to help what will fit the demographic requirement. Even a group of vendors can also act as your go-to source for acquiring frames but keeping the vendors to a minimum will help you to power up your profitability.
Managing your payment towards the vendor can also be made easy with the 30-60-90-120 day policy. The vendor payment would vary with the costs of frames and the policy through which the payer would make a payment. A negotiation which is profitable for both ends will be your best path.
Small And Independent Manufactures
The big vendors such as Luxottico, safilo or marcho are some of the biggest manufactures of frames and glasses. You should browse through the other independent booths which have fewer crowds. Often the good purchasing decisions that you will make is connecting with the small independent manufacturer. According to recent testimony for one of our clients, found a budget frame line which gave in the price range of about $20 while the big brands charged $119 to $159 for the inferior quality. They even provided different choices of colors, material, style, and size.
Purchase Of Non-Current Frames
If you ask a sales rep to show some of the non-current frames there in nothing wrong with it. Non-current frames are only discontinued frames for which the manufacturer has limited stock remaining or has discounted frames. The discounted frames are usually kept below 75 percent of the price range of the wholesale price.
Join A Buying Group
Maximize the profit by joining a buying group. An advantage of this strategy in that the group negotiates the price for you. So you can have an affordable price at a higher discount than what you might be able to get on your own. This group even gives incentives if the frames are purchased through the group for a longer period of time.
FAQs:
1. What are industry benchmarks, and how do they help optometrists?
Industry benchmarks provide performance standards that help optometrists optimize their product sales and increase profits. They show how to effectively manage inventory and pricing for eyewear and contact lenses.
2. Why is it important for optometrists to manage their eyewear acquisition costs?
Managing eyewear acquisition costs ensures that optometrists maintain a healthy profit margin. It helps in maximizing profits from each sale by keeping costs lower and margins higher.
3. How does knowing your patient demographics benefit optometrists?
Understanding patient demographics helps optometrists stock frames that meet local preferences and needs. This alignment can boost sales and ensure inventory matches demand.
4. What is the advantage of buying frames from a limited number of vendors?
Buying from a few trusted vendors can lead to better discounts and a more streamlined inventory. It also helps in building stronger relationships for future negotiations.
5. Why should optometrists consider joining a buying group?
Joining a buying group offers access to better pricing and discounts negotiated by the group. It also provides incentives and reduces individual purchasing costs.
