Eye On Equipment
Calculating savings
By Susan P. Tarrant

Twenty five lens orders a week. Five a day. If your new lens orders average around those numbers, you fall into the category of dispensers who may benefit financially from installing some in-house processing equipment. How much you benefit financially depends on your individual business, your needs, your customer base, and your personal incentive.

Because your business is unique, equipment experts don't like to quote just one general equation to calculate when a business is ready to go in-house, or how much money it will save. Factors other than finances and lab bills also should play into the decision.

Each equipment company looks at the decision to create an in-house lab differently. That's why it's always a good idea to talk to several before making your decision--not only to get a good selection of equipment cost quotes, but also to get as much input as possible.

In addition to the straight "how much will I save per lens job?" question, you should be considering the following.

Your business growth. Take a look at the volume you do now, and the amount of growth you've experienced over the past three or four years. If you can chart continued growth over that period of time, you will benefit from doing your own lens work, because you'll be able to handle the volume that comes with a new service, and offer better turn-around time.

Your competition. Look around at what other dispensaries in your area are offering. "If you're the only guy in the middle of nowhere, and there's no real competition or pressure to do anything differently, that's one thing," says Susan Polson of National Optronics, manufacturer of retail finishing and edging equipment. "But if you're across the street from a LensCrafters or somebody else offering one-hour service, that's another thing. You may have to consider keeping up."

Your customer base. This is something you should know inside and out. Of all the factors to look at when deciding if in-house processing makes financial sense for you, it's your customer base that may ultimately make the decision for you.

"Do you have people, maybe primarily older people, who are quite content waiting a week for their glasses?" Polson asks. "Do you have a lot of younger people or baby boomers who expect quick service and want fast turnaround? Those people will react positively to this service."

Your personnel. One of the biggest fears preventing dispensers from installing equipment is that they need to hire and train someone specifically to run the lab. Nothing is further from the truth, say our experts.

"If you're only doing five or so jobs a day, that's not enough to warrant hiring someone new," says Matt Vulich of AIT Industries, makers of edgers and other in-office lab equipment. "You can train existing staff."

Polson agrees that today's user-friendly equipment makes hiring a dedicated lab tech unnecessary, but she also warns that dispensers make sure their existing staff includes someone who can indeed handle the responsibility of crafting the lenses.

"The equipment is very easy to use, that's true," she says. "But you've still got to have an operator with a brain, someone who can learn the basics of optics, because as idiot-proof as it may be, that person still has to read a lensometer, etc. You're still making a medical device."

Your physical space. Do you have sufficient room to set up a lab, however small it may be? Today's equipment boasts footprints smaller than ever (and getting smaller!), but you still need room for the basic equipment, job trays, space for an operator to move around, and room for your lens inventory.

THE QUOTES

Once you have analyzed reached the conclusion that your business or practice would benefit from offering in-house lens processing, it's time to go shopping.

As you call equipment vendors for quotes on equipment costs, make sure you seek their input on any factors you may be unsure about, such as whether your customer base will grow due to this new service, or whether or not you have enough room for their equipment.

Polson adds that these conversations will help you gauge whether the companies are really interested in helping you grow your business, or interested in merely making a sale.

"Somebody who's just interested in making a sale isn't going to be interested in making sure it's right for you."

This is a good time to test the waters to see what kind of a partner this company is going to be for you.

It's been established that there is no "set in stone" financial equation that speaks to all businesses and practices. Some folks say five lens jobs a day is enough business to warrant going in-house. Others say upwards of 10 jobs or more is what's needed to make it financially rewarding.

You've got to do the math, but to simplify things, Vulich suggests that a conservative statement would be that dispensers could expect to see a savings of $15 per lens job if they brought those jobs in-house.

That's conservative, because according to Thomas Fefer, ABOC, FNAO, the western U.S. sales manager for Santinelli International, dispensers can capture additional profits from lens enhancements such as edge polishing or tinting. Those capabilities are easy to add to an edging lab. Fefer says dispensers could expect to see their lab bills reduced by one-third if they order only uncuts and do the finishing in-house.

Surprised that you can justify an in-house lab on just five lens orders a day? Vulich figures it this way: Five jobs per day equals a minimum of 20 per week, which equates to roughly 100 per month. That's a savings of $1,500 that the dispenser will see. Even paying $600 per month on the lease of patternless edger still brings him out on top.

And if you're doing a lot more volume than five lens sales per day, there's no reason why you wouldn't benefit from taking it all in-house.

Whatever your situation, experts agree that investing in lab equipment will allow you to offer quicker turn-around times and a tighter control over the quality of the finished product.