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A
Fresh Look at Frame Inventory |
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Courtesy of Fashion Optical Displays |
A frame inventory
represents a huge investment for any practice. Your
frame inventory can help your practice earn up to 60%
of its income. There has been a trend in recent years
to slim down and carry a smaller amount of inventory.
Many practices have also fallen into the trap known as
"Board Management". I want to shed a
different light on these misconceptions. |
Management consultants have
recommended that the number of frames a practice displays
should be based on the amount of frames a practice sells.
Their philosophy is that the ideal inventory turns three to
four times a year. An inventory turn refers to the amount of
times the whole inventory sells, or turns over. An example
of this is a practice that sells a total of 1,200 frames per
year should inventory a total of 300 to 400 frames. Let's
face it; a dispensary with 300 frames looks barren, boring
and unimpressive.
Having a barren frame inventory
holds a practice back. Patients today want choices. They
want to see that you have your finger on the pulse of the
industry. They want to see that you truly believe that they
should shop and buy from you! They want to have the
impression that you offer just as much in styles and variety
that the Big Boy Optical's do! They trust you, so give them
what they deserve!
I know that many of you are
sweating while thinking about the dollar signs. Relax. I'm
going to show how you can increase your total frame
inventory AND lower your total inventory dollars! The key to
success is smart buying. You must change your buying habits
to increase your potential profits. It can be scary at
first, but if you set your mind to it, your practice will
benefit immensely.
One of the first things that you
should do is forget the idea of "Board
Management". Board management is the system of allowing
frame manufacturers and their sales reps to take control of
your frame inventory. Basically, you allocate a certain
number of board spaces to each vendor. The sales rep for
each vendor comes in every six to eight weeks and checks
their spaces for discontinued frames or frames that are slow
sellers. They exchange out and replenish their spaces. That
sounds fantastic in theory. It is really silly when you
logically think about it. Why would you give control of one
of your largest investments to frame companies? I feel it is
a lazy and irresponsible way of managing your business.
Many of these frame companies
carry mid-to higher priced frames. If you take back control
of your buying, you can add frames, and lower your total
cash outlay. There are many frame manufacturers that offer
very good frames at great prices. If you compare quality and
styling, you will find that you are probably over paying for
many of your current frames. The Big Boy frame manufacturers
roll the cost of frame exchanges, exaggerated warranties,
and sales reps commissions into each and every frame. You
pay for all of that! If you do your homework, you will be
able to buy great frames at less than half of what you are
paying now.
I suggest that you start
networking, go to meetings, read the back of the trade
journals and start looking into different frame companies.
They are out there. Once you find them, you will be amazed
at the quality and value that you will find. Most of these
companies truly want and need your business. They are
usually willing to turn cartwheels to please you. Reward
them with your purchases. It is hard to change your
thinking. I know; I've been there. Take small steps and
incorporate the change into your practice.
Increasing your inventory can
increase business in several ways. You may increase your
capture rate. Patients may be more inclined to shop and
purchase from your practice. You may see an increase in
multiple pair sales. You may create impulse purchases if
patients see a cool sunglass or a colorful reader on your
boards! I feel that an increase in inventory energizes the
dispensers. An energized dispensing staff can create huge
differences in your bottom line! Get the dispensers input.
They are out there on the front lines. Give them some input
on what styles, colors, and varieties to add to your
inventory.
I think it is important to
evaluate where you are at right now in your practice. What
is your inventory looking like? How many frames do you
carry? How many frames would you like to carry? What is
holding you back? Have you thought about bringing in a value
line? Maybe you have thought about beefing up your sunglass
offerings. Now is the time to research alternative frame
companies. Walk out of the shadows of the Big Boy frame
manufacturers. Take back control of your practice dollars.
The sales reps are not doing you any favors! You are paying
for all the "perks" that they offer. Now is the
time to take personal responsibility for your frame
purchases. Buy frames that you truly feel will sell. When
you take responsibility for your purchases, you become a lot
more involved and motivated to make sound buying decisions.
I know that much of what I
presented can and will be disputed. I understand. Change is
tough. I am finding that the more successful practices are
tossing out the old standards and adapting to the rapidly
changing retail optical environment that we all face. |
