To sell or not to sell
That is the question facing optical dispensers when it comes to sunwear and the Internet
By Erinn Morgan

The profits are appealing, but the pitfalls are plentiful. Is it worth it to sell sunwear on the Internet? While the jury is still out on that verdict, one thing is becoming increasingly clear--optical dispensers are more wary than ever about the Internet as a sales medium. An incredible amount of competition, deep discounting, and major issues with fraud have optical shops taking a step back to review the worth of selling sunwear on the Web.

Europticsvision.com, above, is the offshoot of Denver-based Europtics. RudyRX.com, shown right, is a site designed to appeal to fans of Italian extreme sports sunwear manufacturer Rudy Project

"I was kind of excited about the potential of the Internet when we first got our site set up," says Ron Hawkins, OD, at Optiks in Bloomington, Ind., parent to optiks.com. "But we got burned on a couple of transactions where the customer stopped payment, objected to the charge, but kept the product. We went back to credit card people, but they said we had no recourse. The Internet is a can of worms right now--and we don't know where it will go. That is why we have backed off and are being extra cautious about it."

Shops that have not sold on the Net are thinking twice. "We have not been interested in selling on the Net," says Herman Bennett, OD, owner of Au Courant, located in Princeton, N.J., Bal Harbour, Fla., and Troy, Mich.

"We haven't dipped our toes in those waters yet and I'm not sure I've got the right equipment to do it. We are involved with designer eyewear and luxury names and only buy from very legitimate vendors. We cherish our connection with these companies and would hate to jeopardize this by selling on the Net," he adds.

But optical shops that have set up extensive Web-based sunwear sales operations have found ways to conquer fraud, tax issues, and competition.

"When I started the company in 1996, I was looking for ways to increase business," says Shannon Tanabe, owner and dispensing optician at A Sight for Sport Eyes in Portland, Ore., which launched sporteyes.com selling sports sunwear.

Tanabe's Web business has grown more than 400 percent since 1996. "Our store business has also grown a lot, but certainly not as much."

THE BENEFITS

The first plus is simple--increased business. Reaching out on the Web can bring sales beyond your hometown customer base. Once customers have a positive experience with your Website, they will refer friends and family, thus increasing your business exponentially.

"We get referrals from people that have shopped the site--so we know if we do a good job, people will continue to refer others to us," says Bret Hunter, owner of Eye Tech Sports Optical in Lakewood, Colo., which generates EyeTechOptical.com.

The second bonus is that today it is more affordable than ever to launch an e-commerce site. With increased competition in the Web design arena, many firms have lowered their prices to more reasonable levels.

If you have computer skills, the advanced user-friendly Web design software on the market can keep everything in-house and inexpensive. "It is a lot more affordable to build and maintain a Website today," says Tanabe. "I do everything myself. But it is time-consuming. With all the new styles and price changes that come out, I have to update it at least once a week."

	Sporteyes.com supports A Sight For Sport Eyes in Portland, Ore., while Optiks.com is the offshoot of Bloomington, Ind.-based Optiks

THE ISSUES

While the benefits are tangible--and tantalizing--be aware that e-commerce has its price. While costs to build and maintain sites have gone down, money is still a necessity for a successful site.

Traffic. One of the major costs is incurred to drive traffic to your site through search engines, such as Yahoo, Google, and Lycos. Overture is a service that aligns with search engines that direct people to sites when they enter certain search words. SportEyes.com pays about $3,000 per month for pay-per-click service through Overture.

"That is really high," Tanabe says, noting that she tries to cover as many bases as possible with search words and different engines. "I think it's about $1.50 a click now for 'sunglasses.' I try to keep it at 30 to 40 cents per click. You can put a cap on your overall monthly payment to keep pays-per-click down. Overture has recently partnered with a number of major search engines so it is just more expensive now," she adds.

Fraud. No doubt the biggest issue for many dispensers selling online is fraud. Conniving "customers" give fraudulent credit card numbers and addresses in order to steal sunwear products. Unable to confirm and control customer orders from foreign countries, dispensers learned the hard way that fraud has a strong presence on the Web.

"We get a lot of orders from Indonesia that we now just ignore," says Eye Tech's Hunter. "I sent out two pair to Indonesia a while ago and the credit card was denied after the fact. The way Indonesia works is that the government says that if businesses allow themselves to be ripped off it is not illegal for the people to rip them off."

These problems have caused online dispensers to limit or cease overseas sales altogether. Even behemoth Sunglass Hut limits its online sales.

"Right now we are shipping to the U.S.," says Anthony Carretta, director of e-commerce for Luxottica Retail (a.k.a. sunglasshut.com). "Shipping internationally is tougher because of fraud, taxes, and duty. We hope to offer an international shipping option to our customers in the future."

Unfortunately, dispensers say the credit card companies offer no protection for Web or catalog transactions. "We went to the credit card company and they said as long as it was a phone transaction we had no recourse," says Hawkins.

"If you have an imprint of the card, you are protected. We are small and if a few $500 to $600 sales go awry, that eats quickly into our profits. So we have backed off a bit," he adds.

Taxes. Dispensers say that it's difficult to keep track of tax rates in dozens of times zones. "You can't keep up on 50 states' sales taxes, we didn't have enough sales out of state to have this make sense," says Hawkins.

Competition and discounting. Competition is fierce out there in cyberland for the sunwear dollar and the lowest price is often king. Those consumers show allegiance to the site that can show them the lowest price tag.

"It seems to me there are two types of people--people looking for a bargain and people looking for information," says Hawkins. "It's not fair to our own patients to price it cheaper on the Net. There is always going to be somebody out there who sets up a business out of their garage and comes in $20 cheaper."

Keeping vendors happy. Maintaining vendor relationships for your brick-and-mortar stores can mean walking a fine line in e-commerce. Many vendors do not allow online sales and those that do require signed contracts and site encryption before giving the go ahead. If a vendor does not allow its products to be sold online, you must respect this requirement.

EyeTech.com is part of Lakewood, Colo.-based Eye Tech Sports Optical. SunglassHut. com supports Sunglass Hut and Watch Station

"Not only the high-end companies make you sign contracts that you won't sell their product on the Web--most of the large frame manufacturers do as well," says Ira Haber, owner of Denver-based Europtics and europticsvision.com.

THE RESOLVE

Given the roadblocks the Web has thrown to e-commerce, a number of optical Websites are strictly informational.

"I think it should be purely educa-tional--I don't see us selling over it," says Europtics' Haber. "But we have not at all maximized the use of our Website. We need to make it more interesting, make it something that will direct customers more to the stores."

The key, they say, is to offer good information, show the top products and your dispensary stock, and update the site regularly. Many also feature coupons for deals and discounts on their sites to draw customers into the stores.

For those who choose to forge ahead with an e-commerce business selling sunwear, the key is to be smart, be wary, and give it the attention it requires. For the right proprietors, a Web business can be very rewarding and profitable.