Independents Differentiate Themselves With Specialties

A common strategy for labs seeking to differentiate themselves from competitors is offering specialized products and services. The advent of new technologies and the creation of new product categories has created opportunities for labs to distinguish themselves while developing profitable niches. Two labs that have successfully pursued this approach are Rochester Optical in Rochester, N.Y., which produces prescription inserts for smart glasses, and Vision Dynamics in Louisville, Ky., which specializes in glass lenses.

VM asked executives from both labs to explain why they selected their particular niche, what was required to make it a viable business, and how it has enabled the lab to grow.

Greg Novak, Chief Operating Officer
Patrick Ho, President
Rochester Optical
Niche: Ophthalmic inserts for smart glasses

“By engaging in difficult engineering efforts, we sharpen our skills for our core businesses. Sometimes these R&D efforts lead to ongoing business opportunities, sometimes they do not. In the case of wearables technology, our team of optometrists, opticians, frame and lens designers wanted to solve the visual challenges for the users, improving the experience and usability of the technology and ultimately leading to a new line of business in both OEM lenses and aftermarket accessories to enhance the user experience. The goal was to develop solutions for binocular and monocular vision correction for smart glasses. That effort ultimately lead to our “Smart GOLD” technology patents and to a distinct competency in engineering all types of prescription solutions for wearable devices.

Although we made significant investments in an on-going R&D effort and the technology and equipment to support it, we think it is more important to consider the investment in terms of activities and outcomes, rather than counting the dollars. We invested in:

• The ideation and engineering teams
• Prototyping, specialized machine and design technology
• Fundamental R&D expertise and experience
• Freeform design and software development
• Business development and partnership efforts
• And obviously substantial Human Capital outside of those teams

We believe Rochester Optical is the leading provider of OEM and aftermarket solutions for the wearables industry. Our efforts have led to the development of a number of spin-off technologies for:

• The production of ultra-thin lenses
• Tools, fixtures and specialized machines to produce complex products often associated with the wearables segment
• 3D printing capabilities including design inserts and lens carriers

Rochester Optical now has customers in more than 50 countries due to these efforts.

John Dippold, President
Vision Dynamics
Niche: Glass lenses

“The decision to select the glass niche was more about opportunity and timing than strategic intention. A large retail client of ours wanted to outsource their glass work and asked if we would be interested in doing it. As we had skilled glass people on our team, we agreed and created a glass lab. The niche chose us.

Because glass is a mature technology, machine manufacturers haven’t designed new machines in decades. Older technology requires experienced repair and maintenance people. Some parts don’t exist anymore, so you need to be creative to keep everything running properly. Glass also requires a skilled person to touch every lens. Forget computerized mass production. Traditional glass processing needs adept people, heavy training, and an artistic touch. Our lab people make it happen.

The capital investment to start the glass lab was significant. We had to create the lab infrastructure; electrical, plumbing, compressed air, chem hardening rooms, etc. The equipment was not as expensive as an automated plastic line today. However, a lot of equipment was necessary to start a high volume glass business. As the proper equipment is becoming rare and difficult to find, recruiting the right people and our investment in training on the front end has been a critical key to our success. The equipment is rare, the right people even rarer.

Entering this niche opened new doors for our company. What started off as an opportunity for some incremental revenue became a core expertise. We figured if one retailer wanted to exit glass because it’s only 1 percent of their product mix, hard to do, and not a product open to automation, there were probably others. We were right. Retailers were open to our outsource proposition. We also found most labs were eager to outsource the hard stuff and free up lab space for expansion into automated digital plastic which is typically 99 percent of their product mix.

Today, our lab remains committed to glass and is 99 percent B2B. Our customers are other labs and retailers. This is a business model that didn’t really exist before Vision Dynamics and now we are the largest independent glass lens processor in the country.”