Top 10 Snapshots

Profiling optical's largest retail players

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1. Luxottica Retail

2009 Optical Sales: $2,558M (est.)

2009 Optical Units: 2,952

Luxottica Group’s Luxottica Retail division, heading the VM Top 50 Optical Retailers list for the 11th consecutive year, battled the recession throughout 2009, although Luxottica’s chief executive officer, Andrea Guerra, cited signs of a turnaround beginning early this year.

After closing stores during 2009 under several of its retail brands, this year Luxottica Retail is focused on improving comparable-store sales rather than opening new locations. In 2010, its flagship LensCrafters chain is putting more emphasis on one-hour service, multiple-pair sales and the sunwear and premium lens categories.

To help boost traffic for LensCrafters, marketing this year is focusing on “tangible” assets such as one-hour service and its satisfaction guarantee, according to Kerry Bradley, who was named president of Luxottica Retail North America in 2009.

2. Wal-Mart Stores

2009 Optical Sales: $1,374M (est.)

2009 Optical Units: 2,995 (est.)

Approaching its 20-year anniversary in the optical business, Walmart continues as the nation’s second-largest eyewear/eyecare player.

Part of Walmart’s health and wellness segment, the mass merchant’s optical operation manufactured more than 5 million pairs of eyeglasses last year, despite having halted production at its Columbus, Ohio, optical laboratory in March 2009.

Walmart’s vision centers also sold more than 11 million boxes of contact lenses, a big jump over the previous year that was due in large part to its early-2009 alliance with 1-800 Contacts.

Jeff McAllister, who had headed Walmart’s optical business since January 2006, moved on within the company early in February 2010; McAllister was succeeded as senior vice president for health and wellness by Paul Beahm, a veteran of Walmart’s pharmacy business.

3. HVHC Retail Group

2009 Optical Sales: $673.7M

2009 Optical Units: 528

The retail operation of HVHC, a Highmark company, added 13 new locations during 2009; HVHC is expected to open more than 20 additional retail locations this year.

One key focus of attention for HVHC Retail Group has been its optical laboratories, which also serve outside retailers as well as eyecare practitioners who are providers for HVHC’s Davis Vision managed-care business. A new optical lab near Eye Care Center of America’s (ECCA) headquarters in San Antonio, Texas, became fully operational in June, dramatically reducing turnaround times while lowering costs, according to David Holmberg, HVHC’s president and chief executive officer.

Holmberg has talked of plans to consolidate some of HVHC’s multiple store names under its two largest retail brands, EyeMasters and Visionworks, beginning in the second half of this year.

4. National Vision

2009 Optical Sales: $558M (est.)

2009 Optical Units: 597

National Vision’s acquisition of the 64-store Eyeglass World chain from Vision Care Holdings in late January 2009, coupled with consumers’ embrace of the “everyday low price” concept as the recession lingered throughout last year, helped boost the company into fourth place on VM‘s Top 50 Optical Retailers listing.

The company’s America’s Best Eyeglasses & Contacts chain grew by 26 stores—to 237—during 2009, after adding 42 new locations the previous year. America’s Best now tops National Vision’s leased optical departments inside Walmart stores in terms of store count.

National Vision plans to continue to open additional America’s Best locations this year, while starting to expand the Eyeglass World chain it acquired last year, according to Reade Fahs, National Vision’s chief executive officer and president.

5. Costco Wholesale

2009 Optical Sales: $540M

2009 Optical Units: 404

Costco Wholesale continued to grow last year despite the recession, adding another 12 everyday-low-price Costco Optical vision centers within its U.S. warehouse clubs during 2009.

With more than 56 million warehouse-club cardholders, the Costco Optical locations have a built-in traffic flow of regular visitors. And like other “value”-oriented eyewear/eyecare retailers, parent Costco Wholesale is weathering the recession on a positive note so far this year: the company’s overall comparable-store sales were running 3 percent ahead of the previous year for the first half of its 2010 fiscal year.

6. Refac Optical Group

2009 Optical Sales: $226M

2009 Optical Units: 701

Under president and chief executive officer Dave Pierson, Refac Optical Group continued to boost its sales and store count last year, despite the recession.

Since taking over operation of 156 leased vision centers in BJ’s Wholesale warehouse clubs from Luxottica Retail in February 2008—its first venture into the warehouse-club optical arena—Refac has added nearly 20 more BJ’s optical departments. Host BJ’s plans to add from seven to nine new warehouse clubs during 2010 (including one relocation) indicate Refac’s vision center count there could increase this year.

Refac’s major host, JCPenney, on the other hand, has slowed its own expansion. Last year, JCPenney opened just 17 new department stores; in the year ahead, the chain will add just four new locations.

7. Eyemart Express

2009 Optical Sales: $140M

2009 Optical Units: 102

Having hit the 100-store mark in September 2009, then opening two additional locations later last year, Eyemart Express has benefited from its longstanding commitment to the “value” eyewear business, according to chairman and founder Doug Barnes, OD, and president Jonathan Herskovitz, who took on that position in March of last year.

As of last month, the chain was operating about 125 stores in 26 states.

Celebrating its 20th anniversary this year, Eyemart Express continues to stress its “everyday low price” philosophy, focusing on “two-pair” deals such as two pairs of single-vision eyeglasses at $67.92, while offering single pairs beginning at $38.74. In addition, the chain offers one-hour eyeglass service on many prescriptions.

The Carrollton, Texas-based retailer also is expanding Vision Vantage, its eyecare discount program.

8. Cohen’s Fashion Optical

2009 Optical Sales: $124M

2009 Optical Units: 117

Since Houchens Industries purchased its franchise division early in 2008, Cohen’s Fashion Optical has been aggressively seeking additional franchisees, both those with optical experience (including existing stores to be converted to Cohen‘s franchises) and those without. The chain currently has 117 locations in seven Eastern states plus Puerto Rico; Robert Cohen, OD, Cohen’s president and chief executive, continues to direct the chain’s daily operations.

The Cohen’s stores actively work to retain patients through eye exam recalls, direct mail programs and Internet marketing, including frequent discount coupons available in the Cohen’s Fashion Optical Web site. In addition, an Internet Eye Exam Scheduler available to every Cohen’s location allows patients to set up their eye exams online.

9. For Eyes/Insight Optical Mfg.

2009 Optical Sales: $103.6M (est.)

2009 Optical Units: 140 (est.)

Since 1972, For Eyes has positioned itself as a value provider in the eyewear/eyecare industry; executives of the chain describe For Eyes as the first optical company to offer consumers a high-value package price combining frames and prescription lenses.

In 2009, For Eyes invested in its digital infrastructure to increase online retail opportunities, embrace new marketing channels and extend its “smart choice” message to new consumers by offering two pairs of eyeglasses for $99 through its Web site. For Eyes also invested in its existing portfolio of stores with an aggressive renovation program.

For Eyes has stores in major market areas on the East Coast from Boston to Florida and in the Midwest, with a large concentration in the greater Chicago market. The chain also has stores throughout California, where it operates a specialized heath plan, For Eyes Vision Plan.

10. ShopKo EyeCare Centers

2009 Optical Sales: $82M

2009 Optical Units: 136

Rejoining the Top 10 segment of VM’s Top 50 Optical Retailers this year, mass merchant ShopKo Stores’ optical division 134 ShopKo EyeCare Centers in its discount stores plus EyeCare Centers in two of its six ShopKo Express drugstores.

ShopKo Stores opened its 141st retail location in March 2009, its fourth new store to use a new retail concept that puts the optical department right up front.

ShopKo’s eyecare operations—first launched in 1978—include online ordering of contact lenses via its Web site. The company’s affiliated optometrists perform more than 380,000 eye exams each year, according to ShopKo, and dispense nearly 700,000 prescriptions for eyewear annually.