Although it’s a good problem to have, practice growth does generate new challenges. We recently expanded from a single doctor 4.5 days per week in an 1100 square foot space to 2 doctors (and additional staff) 4 days per week in a 3400 square foot space. Because of this, we more than doubled the size of our optical. With higher overhead costs, it became even more important to maximize our profitability in the optical. Ironically though, the new larger space created enough physical separation that it was more difficult for me to hear and see what was going on in the optical.
I’ve always checked practice metrics on a regular basis, however the new location has caused me to be even more diligent about monitoring our numbers and implement changes where necessary. I’m also more consistently drilling down to uncover performance per staff member and per doctor now. EDGEPro has been a tremendous tool, providing the data I need to manage frames and coach staff to ensure maximum optical profitability.
PRODUCT MIX: USING TURNOVER RATE IN FRAME BRAND SELECTION
One metric I track consistently is our specific frame brand sales in our analytics software. This report does a great job breaking down the number of frames sold per time period (I analyze month, quarter and year and usually pull a report before a rep is coming). We have our frames grouped together in rows of 15, so most frame lines get 15-30 spots. I’d like our core (non-luxury) frames to turnover a minimum of 3x per year, so I am looking for 45 frames to sell if that brand has 15 spots.
For example, we brought in one frame line, and while we all thought it would sell well, it consistently fell short of this turnover. We decided to exchange it for another line by the same vendor, and that frame line has consistently turned-over more than 3x. This also raised our capture rate (we were selling more frames), and our average frame price (the new line was more expensive).
Conversely, for a different frame line, we started small with a 15 piece buy-in, and we quickly sold them all so we had to replenish. In 3 months, we had turned-over much more than our 3x goal, so we decided to increase that line to 30 pieces by going deeper with more colors and sizes of best sellers. I continue to watch this to make sure we are meeting our turnover with more frames. I also filter down by optician in this report to see if each of my 3 opticians is consistent with selling brands. If one is underperforming selling a certain brand, training is done to make sure they know the features and benefits of each line. If someone is a superstar and significantly sells the highest number, I’ll ask them what their secret is!
In addition to watching the turn rate, I also monitor and measure staff performance. I first look at our overall practice numbers (number of frames sold, average frame sale, patient’s own frame and $0 frames ) to see how we’re trending. I then break it down by staff member to see if they are all consistent in their percentages. The number sold can be different as they are not all working the same days, but I look to see that they are about even.
BUILDING CONFIDENCE IN SELLING
I noticed that “Optician A” was usually significantly higher in all metrics but compared to last year seemed to be selling less frames, had a lower average frame sale, and was higher in patient’s own frame and $0 frames. I pulled her aside to show her the metrics, and to check in to see if she was aware. We did some role-playing to help her be more confident talking to patients about not using their own frame as she had felt uncomfortable with pushback. Together, we developed a strategy to start with higher priced frames first, instead of showing patients frames that were covered by their plans. I suggested she start with a $400 frame versus showing patients a frame that will cost them $0. She also told me that she felt we were missing a moderately priced men’s frame in a good price range for patients not covered by insurance ($250 range), and was having trouble finding frames for this demographic. In this situation, she was often re-using a patient’s own frame. We quickly added a men’s frame line to fill this niche, and her $0 frames dropped significantly as did her patient’s own frame percentage.
LENS SALES BY OPTICIAN: TURNING A NEGATIVE INTO A POSITIVE
I do the same with lenses – I look overall at the practice and break down the metrics per optician. Our office has an extremely high percentage of AR but can struggle with photochromic lenses, so this is a constant source of training. I noticed “Optician B” was around 10% in photochromics, while the other opticians tended to be closer to 20%. I decided to be a “secret shopper” and eavesdrop while she was working with patients. I listened to how she presented photochromic lenses, especially after I had discussed them in the exam room with the patient. She would say to the patient “you don’t want the lenses that change from light to dark, right?” I don’t think she was even aware that she was framing the question in the negative.
We did some role-playing and training and changed her presentation to “I see Dr. Stewart has prescribed lenses that change from light to dark. I’m wearing them right now and I love the convenience! Our patients love how they get dark in the sunlight and change to clear when they go inside. Your insurance has a copay of $x for that, so you even save money on them. How great is that?” Turning a negative question into a positive made a huge difference. We also brought our ophthalmic lens reps in for training and had photochromic lenses made for our opticians so they could really see the benefits. Her percentage of photochromic lenses increased to be on par with her two colleagues. It is something to continuously watch though, as we can all fall back into our same habits.
OBJECTIVITY FUELS CONFIDENCE
Having been involved in athletics my whole life, I realize the importance of confidence. As business owners and leaders, we all must take risks to drive success. However, in business overconfidence can sometimes lead to inattentiveness which can then result in failure. The objectivity of data and reports allows me to discover business trends that I could otherwise miss. It gives me the ability to intelligently and confidently take on risk and guides my decision-making as my practice grows.