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With a minimum buy-in, inventorying in-office can save money, such as with the
Same Day Satisfaction option offered by Alcon’s Dailies AquaComfort Plus.

“We sell lots of year supplies” is a very common answer when asking owners if their contact lens departments are profitable. While this is a good starting point, what you do after you’ve sold that year supply will ensure that you’re maximizing profit on the back-end.

The three, internal, non-patient-facing ways to increase your net profit on contact lenses are:

  1. Reduce Staff Costs
  2. Understand Available Programs
  3. Consolidate Vendors

Reduce Staff Costs
Every time an additional step occurs within the process of ordering and delivering contact lenses to patients costs the business money. There are ways to reduce the steps in this process to save both time and money—have your staff order through a distributor and have contact lenses shipped directly to the patient’s home.

Order through a distributor: When ordering directly through contact lens manufacturers your staff will have as many as three to six accounts to reconcile and websites to manage. Then, if and when a patient switches contact lens brands, your staff will have to re-type the patient’s name into the system when ordering their new contacts. Distributors can typically match all of your direct pricing and save your team an incredible amount of time.

As a multi-location practice, you can set up a centralized billing account and ship to multiple addresses if that is how your corporation is set up.

Ship contact lenses home: It’s crucial to ship over 80 percent of the contact lenses that you order directly to patients’ homes, excluding contact lenses inventoried onsite. If you’ve already tried to ship more contact lenses home and have been unsuccessful, follow this formula:

Implement a standard shipping charge whether you ship the contact lenses home or to your office. Ask patients which one they prefer. When there is no cost savings to ship contact lenses to the office, more patients typically prefer to have their contact lenses shipped to their home or work to save them time and hassle.

Understand Available Programs
The following are typical programs available when ordering contact lenses:

Lower per box costs when invoiced: As part of an alliance, through negotiating, or using other methods, you can significantly reduce the costs you are charged for a box of contact lenses on the invoice.

Banking lenses at the distributor: Christina Rae from OOPG said, “If I told you that you could save hundreds to thousands of dollars a month on your orders would you buy in to it? When you buy a bank or inventory you not only have the option of split billing, but you can save anywhere from $1.00 a box to $12.00 a box depending on the promotion. You’re going to purchase the boxes over time in your day-to-day ordering anyway, so why not purchase in bulk to maximize your profitability on all your orders.”

Find out from your distributor if they’ll allow you to buy one bank that all the locations can pull from. If so, you’ll be able to use up the banks very quickly, so make sure they are on auto-renew.

Inventorying lenses in the office to get other benefits: When you inventory lenses in the office it not only saves staff the time they would spend on ordering the contact lenses for a patient, but there are also financial benefits on the back-end. While these programs change throughout the year and are different for each vendor, here’s one example: Alcon has an inventory option called Same Day Satisfaction, which offers a savings with a minimum buy-in of 150 boxes on nine products within the Alcon Dailies AquaComfort Plus line.

Consolidate Vendors
Whatever your contact lens philosophy is for your practices, all of your doctors and your staff should have a consistent message. The first priority is always what’s best for the patient, but when two choices of contact lenses are equal, what do you do? Typically, we find doctors in the same location are more likely to have the same philosophy. It’s important to ensure all the doctors throughout all the locations are on the same page. Use your practice management system or an analysis system such as The EDGE to monitor contact lens sales. Then, create a document that indicates your top three choices in order for each modality. Lean toward minimizing your manufacturers.

In addition to your team becoming experts on the pricing of a limited number of lenses and vendors, consolidating lenses and minimizing manufacturers will help to increase your growth and therefore your quarterly or yearly rebates with that company.

Follow these steps and with economies of scale, the more locations you have the bigger the benefits will be to your contact lens business.

 

Jay Binkowitz, optometric business consultant, is chief executive officer and president of GPN, exclusive provider of The EDGE.

 

 

 

Evan Kestenbaum, MBA, is chief information officer of GPN, Exclusive Provider of The EDGE. Contact Jay and Evan directly at clientservices.gpn@gmail.com.