During this course, we’ll be covering optical management and optical management strategies. You and your staff will build the relationship on the retail side of your practice as well. Really think about what is going to make your optical unique from others in your area and even online competition. If you haven't yet thought about this, this is the time to do so, write it down. This is your homework! Revisit your overall business plan and now really focus on the optical. Do your frame lines come with a story? Tell it, people love stories. Know your products and believe in them. Are you using the latest in technology in your optical? Perhaps using a digital measuring device instead of an old-fashioned PD ruler or pupillometer. Brag about it, sell the benefits of this technology. What about the products themselves? Are you using superior lenses and frames, great quality backed up with a fantastic warranty? Educate your patients and shoppers. Tell your story, show me, tell me your story.
You will probably now be ready to begin purchasing your initial frame inventory. You will be keeping a number of things in mind beginning with your business plan. How much can I spend and how many frames should I carry? Your startup cost worksheet budgeted for approximately $26,000 and opening with about 350 frames. 70% of your inventory should have retail pricing between $135 and $275. 30% will be divided between lower and higher end frames, so about 15% bookends for pricing. Don't be concerned right now with the exact dollar amounts as they can be skewed depending upon your demographic, but rather allow yourself to visualize that nice balance and the ability to tell patients we have something for every budget or we have unique product you won't find anywhere else locally or anywhere else in the state.
About 50% of your inventory should be women's frames. Women purchase more frequently and prefer a few more choices. About 30% will be allocated toward men's frames and 20% for children's frames and specialty frames. It’s all part of that puzzle.
These are pretty wonky numbers, but in reality, they are reflective of an actual practice. A client, a doctor in an established practice when I first came to Williams Group. I don't show you this to make fun of a client or colleague, only to demonstrate this is what happens as a practice grows and everyone stops paying attention to the numbers. The majority of the frames in this practice are weighted at the bottom of that bell shaped curve and there's only one frame that sits at the other bookend, which is the higher end product. It will never sell. Actually, neither will the other 5 outliers. So, this practice really has capped its inventory dollar amount at $240. Probably more likely in the area of about $200 to $225.
Yes, this is perfectly calculated for demonstration purposes, but strive for this. Again, you can always skew the dollar amount up, just think about the appropriate allocation. We recommend that you work with a limited number of vendors, about seven to ten in the beginning. Working with too many vendors stretches you in many ways. First, is your time. It takes time to meet with the reps and manage the inventory. Not just initially, but to manage the inventory and to see those reps on their rotation. Secondly, it is a better practice to purchase deeper in a frame line meaning more product than to have just a small sampling, unless it is a very unique frame, that is just a few pieces, maybe six to eight will represent it well. That is however the exception. We recommend that you have your vendors sign some type of a vendor agreement. They will be asking you to sign a contract and so that expectations align on both sides of the table, we have an example vendor agreement that you can ask your reps to sign as well.
So, how do you achieve the perfect plan? Stick to your business plan, which means keeping track of how much you are spending, what lines are unique in your area, and then that right mix of price, gender, and specialty that we just reviewed. Now specifically, what lines do you want to sell in your practice? Let's go very big picture to start with. There are commercial frame lines with recognizable name branding and then there are independent frame lines. Doctor, it's your practice, but if you want to be different than others in your area, then typically the commercial brands, with a few exceptions, will not let you achieve this. By now, I have shared a list of independent frame lines with each of you as you created your business plan and we can discuss this further.
Let me offer some other tips to get you started on this inventory project. Make a list of frame lines you are considering. What is unique about them? Is there another frame line or company that you are considering that has that same niche? If so, choose one. You can only carry so many frames. So, don't have more than one line, two lines that essentially compete with each other. For example, you have two frames on your list that give back or two lines that are green or eco-friendly. Choose one. Next, reach out to those vendors to express interest in carrying their product. Some unique frame lines won't sell to everyone. Perhaps they have granted exclusivity to a nearby practice or optical store. Move on to the next. There are many options. You also need to understand what minimum purchasing requirements are in place from companies you are considering. So, this will be part of that puzzle as well. You will be provided with an example spreadsheet that you can use to keep track of your orders or even mock orders as you begin meeting with the frame reps. You are welcome to use our Excel spreadsheet for this purpose, but if you prefer just a notepad and a pen, that is fine as well. Just keep track as you meet with those frame companies or they're sending you product.