VEW 2015 Maximizing Practice Success through Optical 2010-2015 ... gross revenue in optometric practice. This revenue is produced with very little ... Do this and optical sales will

7/26/2015

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Neil Gailmard, OD, MBA, FAAOPresident, Prima Eye Group

Atlanta, Georgia================================================================

CEO, Gailmard Eye Center

Munster, Indiana

Disclosures

Neil Gailmard, OD, MBA, FAAO has received honoraria or has other consulting arrangements with the following companies:

� International Vision Expo

� Alcon

� Essilor

� Signet-Armorlite

• PentaVision• Jobson• Prima Eye Group

Neil Gailmard, OD, MBA, FAAO

� Co-founder/President/Consultant, Prima

Eye Group

� CEO, Gailmard Eye Center, Munster, Indiana

� Visiting Lecturer, UC Berkeley, School of

Optometry, 2010-2015

� Editor, Optometric Management Tip of the

Week, 2002 to 2015

� Optometric Business Innovator award for

2014 by Vision Monday

Lecture notes

� Email: [email protected]

� Questions are welcome.

Why is optical important?

� Medical eye care is important, but not the

savior for optometry.

� ODs are losing their focus on the most

lucrative aspect of our profession.

� Get over the fear of selling.

� Teach your staff to sell.

� Patients do not think optical is trivial (only

ODs think that).


� Optical is extremely profitable – much more

so than office visits and medical testing.

� Optical can easily produce 50% or more of

gross revenue in optometric practice.

� This revenue is produced with very little

work by the doctor.

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Is a practice with a high

percentage of medical revenue

doing well?

� Is a practice with 70% of its revenue from medical

eye care doing great with medical… or is it just

doing poorly with optical?

� Optical sales can happen concurrently with eye

care services.

� Some ODs just stop thinking about glasses. They

may not even do a refraction on medical cases.


� A great optical is a huge practice builder!

� Patients love it! The patient experience is

key to practice growth and optical is the

most fun part of the visit!

� Word of mouth referral.


� I understand that as an optometrist, optical

dispensing is not your favorite thing… but as

CEO of your practice, it should be your favorite

thing.

What about the future of

optical?

� The future looks great to me!

� We can compete just fine with online

vendors and any other retail concept!

A. We have the customer first and I don’t

see that changing for a long time.

B. We are the trusted authority on eye care

and optical products.

c. We will evolve and adapt and do what

we have to do to maintain sales.

What about the future of

optical?

� The service of eye care and the product are

closely tied together. That’s good for us.

� Our opticals are not simple retail.

� People would rather buy glasses from their

optometrist than online.

� Price is really the only factor and we can

adapt to that as needed and still be

profitable. If you accept vision plans you

have already adapted to that!

Key points for optical

• Devote large floor space (>1,000 SF)

• Beautiful and visible

• New high end displays and furniture

• Large inventory (1,000 frames)

• Move frame lines up in price. What’s the new

upper end?

• Show $600 to sell $400

• Exclusive lines?

• Your market won’t go for this?

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The biggest problem facing

optometry today…

� Not enough patients.

� Insufficient patient demand.

� Solve that issue and all other problems go away.

� How many patients are enough?

How to increase patient

demand

� Word of mouth referral

� Vision plans

� Marketing

Why do some practices gross

millions of dollars while

others struggle?

What is the secret to success

in optometry and optical? It’s customer service.

I wish it was more dramatic!

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Customer service

� I’m obsessed with patient satisfaction.

oActually, customer LOYALTY is a better term.

o Satisfaction is the lowest acceptable level of

service.

� I’m talking about legendary service!

� Because I’m obsessed…my staff is.

� Customer loyalty is the single most important

factor in practice building.

Don’t kid yourself

� Your practice is probably not all that great at

customer service

� Mine could be way better (and I’m obsessed)

� Most small businesses aren’t

� Most doctor’s offices aren’t

� Many O.D.s don’t get it… they aren’t objective…

they don’t know what they don’t know

� What has been your experience?

What about the

unreasonable patient?� This is where it really gets fun!

� This is where we find out who really gets it.

� The patient who shows up 30 minutes late.

� The no show.

� The patient who said she did not have

insurance, but two weeks later…

� The patient whose husband says she should

return the glasses for a refund.

� The patient who calls and wants to cancel his

glasses, but they are already made.

When do you draw the line?

� Do you want to avoid attracting more people

like this?

� Do we get more of these people with certain

vision plans?

� My staff is always looking for the exception;

they feel protective of the practice.

� Do we want to stop people from taking

advantage of the practice and if we give in, will

they take more advantage?

When do you draw the line?

� Have basic rules in place.

� Know how to say yes first.

� Fees, payment policies.

� Health concerns.

� Tell patients these things in advance.

� Once you start drawing the line, it keeps

getting drawn sooner and heavier!

Our policy is yes!

� Set policies based on patient’s wants and needs

– the definition of marketing

� Not on doctor’s or technician’s

� Don’t teach policies to staff… teach principles

� Policy is just a way of saying NO

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Examples of poor service

� Odd office hours – closed for lunch, closed

Friday afternoon, closed Wednesdays.

� Not enough evening and Saturday hours

� Long patient wait times.

� Rude and rushed staff; attitude

� No one at the front desk

� No one answering phones (voicemail)

� A small waiting area; small optical

� Am I being too harsh?

Examples of poor service

� Not enough parking close to door

� The out-of-date office

� The arrogant doctor

� Back orders

� Staff members with odors, coughing, worn

clothing

� Embarrassment and confusion over fees and

insurance

� Slow eyeglass delivery time

You aren’t being a wimp

� Letting patients win is a very smart strategy.

� Don’t let your ego get in the way of practice

growth.

� Saying “yes” right away prevents small problems

from becoming big ones.

� So does saying “I’m sorry”.

� Set or change policies for the future.

� It makes life in the office more pleasant.

Entrepreneurial thinking

� Realize the advantages of a large practice

� Visualize the dream practice

� Stretch to make yours look like that

� Make changes before you “need to”

� Act as you mean to go

� Reinvest, even if you must borrow

� Grow in a step by step fashion

� Develop a system that does not depend on

you

There are only three ways to

make more money

1. Raise fees.

2. Sell more things to each patient.

3. See more patients.

Which of these can you do?

•Cutting expenses is a fourth way, but you

can’t cut your way to prosperity.

Optical staff

� Master optician

� Office manager or optical manager

� Frame buyer

� Marketing director

� Optometric technician (super-tech)

� Frame stylists/opticians

� Lab technicians

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Optical staff

� The handoff

� No one is available

� How many staff do you need?

� Rule of thumb for optometric practice:

1 staff FTE per $150,000 gross revenue

� $600,000 practice needs four full time

employees (non-OD)

Delegation in your practice

� Too much – not enough

� Pretesting

� Scribing

� Optical dispensing

� Office administration

� Medical eye care – Associate OD

Scribes

� I’m very pleased to see scribing finally gaining popularity among ODs!

� I first wrote and lectured about the concept over 25 years ago.

� Widely used by ophthalmology, but optometry is slow to embrace.

� It is far more practical and affordable than you might think.

My super-tech model

� A high-level of cross-training.

� Technician = optician = scribe.

� A group of super-techs who go where they are needed; paged to do pretesting, dispensing or special testing.

� I try to have three technicians per working doctor.

� It is a big cultural change for many practices, but it can just become the norm.

An innovative system for patient

flow

� Technician is with patient through entire visit.

� Patient never left alone.

� A bonding experience.

� Great customer service.

� Doctors don’t page techs…techs page doctors

Benefits of scribes

� The only thing better than a good patient handoff is no

handoff.

� Tech hears doctor consult first hand and carries it out.

� Seamless flow from exam to optical.

� Doctor leaves the room first

� The greatest time saver ever!

� How long do you take on your records – paper or EMR?

� Patients are impressed with the process

� No walking patients or searching for an optician or technician.

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When to bring in an associate OD

� The goal to work toward

� Part time or full time?

� Are you booked solid more than 2 weeks in advance?

• Same as cash sitting out there

� Is your practice highly delegated?

• Do that first

� Does not have to be a partner or owner.

� Goal is to move patients from the owner.

Hiring a new employee does

four good things:

1. Customer service improves.

2. Increased delegation.

3. More productivity.

• Number of patients per day

• Number of eyeglasses sold

• Number of contact lenses prescribed

4. Can improve performance of existing staff.

• Less stress

The role of the doctor

� With patient

� As CEO of the practice

� In both cases, we need the doctor to be

very involved, informed, proactive and

interested.

� I believe strongly in delegation, but the

doctor’s knowledge and leadership plays

an important role.

The doctor as optical advisor

� Prescribe and recommend

� The power of the doctor

� Makes sales very easy for opticians

� Set the stage for them

� Do not act like you know nothing about

glasses and think that impresses patients – it

does not.

� You know plenty.

The doctor as optical advisor

� Review the patient’s current glasses.

� Recommend the best eye care.

� There is more to the exam than just the

Rx change.

� Use a lens feature notepad as you talk

with the patient; give to optician.

� Prescribe the lens features you think

are best.

Lecture notes



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Lecture notes



Management Tip of the Week #1

� Do this and optical sales will increase.

� Staff takes case history in pretesting.

� Ask every patient: “Are you planning to get

new glasses today?” Checkbox yes or no.

� Amazing, really, that as eye care professionals,

we might neglect to ask that question.

� When the yes box is checked (often is), I can

assure you that the patient gets new glasses

that day.

Do not pre-judge the patient

� Staff and doctors do it all the time.

� Talk about it at staff meetings.

� Teach sales techniques to staff.

� Inspire staff members and tell them how to

advance their careers

Recommend the best eye care first

� Presumptive selling

� Pre-judging the patient’s ability to pay is a huge mistake!

� What factors do you use?

o Age – young or old.

o Occupation.

o Clothing.

o Grammar and speech

o Type of car they drive

� It is disrespectful and discriminatory.

� My screen door story.

How to sell anything…

�Don’t make the biggest mistake in

selling: start by telling patients what

we have to offer.

�Always start by asking the customer

questions – and listening.

�They will tell you how to sell them!

�Whatever they tell you, you will know

the products that will help them!

How to sell optical products…

�Tell me how you use your eyes at work.

�Do you participate in outdoor activities?

�Do you have any hobbies?

�Do you use a computer, iPad or smart

phone?

�Do you watch TV?

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How to sell optical products…

�Enthusiasm sells!

�Even if you have to fake it.

�Mrs. Smith… we just received a shipment

of the new XYZ collection and they are

soooo cute! I’d love to see you try on a

pair!

How are your multiple pair sales?

� Do you track it?

� It is extremely important with vision plans!

� What is your discount policy on multiple pairs?

� Why it should be 50% off!

� Helps you bring up the concept.

� Raise prices first.

� Labs offer pair 50 programs.

Presenting lens options to patients

� Stop presenting options!

�Patients want to know what you

recommend for them!

�The technician/optician is an eye

care professional. Patients trust you

to give them the best.

How to sell premium lenses� Stop presenting the premium vs. standard

option; just tell patients we are using the

most advanced lens technology ever made –

the lenses are called “digital” meaning they

are designed and surfaced by a computer.

� We use XYZ lenses, the finest optics made.

� These lenses are clear and sharp from edge to

edge, with no swim and no distortion. Clearer

night vision, less eye strain. Other patients

I’ve fit love them!

How to sell premium lenses�Move on to next aspect of lens design:

antireflective. Don’t prejudge there

either!

� Don’t presume the patient won’t want

it!

� Don’t presume the patient wants the

cheaper AR!

� Presume they want the best!

How to make patients love you and

your practice

� Smile

� Use their name

� Eye contact

� Introduce yourself and shake hands

� Compliment them

� Ask them questions about their favorite topic

� Make notes in the record

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Is there still a market for high-end

eye care?

�Why should people choose us?

�Why not go to Costco or Wal-Mart

for exams, glasses, contacts?

�Why not buy online?

�After all – we are not the cheapest?

Why…

� … do people stay at a Ritz-Carlton when

there is a Day’s Inn nearby?

� … do people dine at Ruth’s Chris Steakhouse

when there is an Applebee’s nearby?

� … do people drive a BMW when they could

drive a Ford?

� … do people go to Disney World when they

could go to a local amusement park?

High-end vs. low price

�Do people who buy the former feel

they got good value?

�Which one drives more word-of-

mouth referrals?

�Are the high-end options only for

wealthy people?

The lab relationship

� Price is important, but so is service and

support.

Frame board management

� So many misconceptions… with conventional

wisdom

� Don’t carry designer brand names that can

be found elsewhere.

� Don’t carry too many frames; too much

money sitting on displays. 3 or 4 turns per

year.

� Don’t accept a frame line with a large buy-in.

Frame board management

� Use a higher mark-up formula; 3X is out of

date

� Buy smart for vision plans. What is the

typical wholesale frame allowance in your

area?

� Should you carry low-end frames?

� High end frames?

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In-office lab

� Great way to increase profit and

improve service

What people like about our offices

� Trust the doctor

� Relationship with staff

� Local support

� Personal touch

� Continuity

� Records

� Takes insurance

� Could be fast – internet is not fast – in-office

edging

� Service after the sale

What lures people away from our

offices

� High price - maybe?

� Inconvenient

� Maybe out of date?

� Poor customer service

� Most of these you can overcome

What can we do to compete?

� Better customer service.

� Better technology.

� Better staff with continuity.

� Larger offices. Larger optical.

� Same day service.


� Vision plans – that is only for the first

pair!

� We don’t always like vision plans – but

they bring patients in to our office.

� Work on strategies to increase profit with

vision plans.

� Start by actually measuring your profit

with each plan – how?

Track your Rx retention rate� We need a more accurate method than dividing

number of glasses sold by the number of refractions

performed.

A. Count Rxs that walk out per month (staff knows).

B. Count all jobs made per month. Deduct multiple

pair sales and Rxs that came from outside.

C. Add A plus B for total Rxs written.

D. Divide A by C for percentage Rx walkout

E. Inverse is percentage Rx retention

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What retention rate is OK?

� Glasses: 90%

� Contact lenses: 80%

� Track every month and look for sustained change in

your practice.

10 Reasons to Buy Your Glasses at…� We offer a huge selection of frames and sunglasses that you can actually try on… to see how you look

and how the frame feels on your face. Our opticians will help you find the perfect style, size, and color in your price range. Frames start at $95 and go up to include models that are made with real gold or exotic woods at over $1,000. We carry well-known designer brands and also many exclusive frame lines. We are happy to order additional frames or colors for you to see and try-on if desired.

� You will be assured of getting the highest quality lenses and frames. We are optical professionals and we use the finest products available to provide you with the clearest eyesight and good durability. Online vendors often use inferior products, because it is hard for the consumer to tell the difference -at first.

� Our opticians perform 10 precise measurements of your eyes and facial features which are used to place your eyeglass order. We use advanced computer software and facial imaging technology. A PD measurement alone is not enough to make a good pair of glasses. We do not provide our proprietary measurements to other sellers.

� We accept your vision plan insurance. Most online vendors and optical stores do not. We are in-network providers for all major vision plans and we can check your benefits and accept payment directly from your plan.

� In addition to accepting major credit cards, we accept Care Credit, which is a health care financing service. You can apply in our office and select a six month payment plan that has zero interest.

� Our opticians are experts in lens products and features and they can be rather complex. We will guide you through the multitude of choices and explain what the lens features will do for you. We want you to get the best glasses and not pay for things you don’t want or need.

� We verify your prescription lenses for accuracy, we check the frame size and we approve the overall quality of workmanship before we contact you to pick up your new eyewear. If the job does not meet our high standards, it is returned to the lab and made again. Most online vendors do not check your

What do you say when you

dispense glasses?

� Compliment

� Enthusiasm

� Review everything about glasses – why?

� Sell again

What are your services worth?

� Doctors tell me they would raise fees but staff are

concerned…

� ODs generally have fees that are too low.

� Consider what plumbers charge… lawyers…

ophthalmologists?

Forget the low-priced market

� Stop thinking of your practice as a place with

great service at reasonable prices.

o You can’t be all things to all people.

o High end businesses have high prices.

� Help your doctor achieve a high fee practice.

� The discount world is too hard to compete in –

so don’t.

Exam fees – optical prices – contact

lenses

� Generally… all too low.

� Keep fees simple.

� Can you tell a caller in advance what an exam will cost?

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What if you are dominated by vision

plans?

� Then you should definitely raise fees!

� Why not raise them?

� Patients won’t complain… but their perception of

your practice goes up.

� Vision plan patients still buy non-covered

services… and when they do…

Maximize profit with vision plans

� Delegate more and work faster.

� Practice the medical model – bill medical

� Coordination of benefits.

� Aggressive frame mark-up and smart frame buying.

� Raise all fees.

� Fit more contact lenses with allowance plans.

� Sell multiple pairs of glasses more often.

Maximize profit with vision plans

� Order and sell non-covered services and

products. Examples: screening retinal photos,

nutritional supplements, Non-Rx sunglasses.

� Sell eyeglass warranties – not with Davis or Spectera.

� Charge a shipping and handling fee for frame and lens

repairs.

� Charge a patient’s own frame fee – not with VSP.

� Only offer premium lenses – not all options.

� Install an edger and cut lenses in house under the IOF

program with VSP.

Analyze your profit margin

• Do each plan separately

• Pull 20 random cases in the past 6 months, but check your

usual percentages of five categories of sales: exam only,

exam and glasses, exam and two pairs of glasses, exam and

contacts, glasses only. Pull the same pro-rated percentages

in your sample of 20 cases.

• Analyze the medical billings separately – or just know that

some of these vision plan patients are billed medically and

you will do better when those are in the mix.

• Include retinal photos, second pairs of glasses, warranties,

vitamins -- everything you sold that was not medical.

Pro-rated case types

• Exam only: 10% or 2 cases

• Exam and glasses: 60% or 12 cases

• Exam and two pairs of glasses: 10% or

2 cases

• Exam and contacts: 15% or 3 cases

• Glasses only: 5% or 1 case


• Total your U&C fees for all services and products at that

visit.

• Show and total all payments from all sources: from the

vision plan and from the patient. We often just look at

the vision plan payments and the charge backs – and it

appears that we get killed.

• Deduct any COGS – this could be the chargeback, the

frame cost if you supplied it (what you actually paid –

not the Frames Data price), the contact lens product cost

if you supplied them, or it could be the lab bill if you sent

the job to your lab.

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• The gross profit on each case is the total of all payments

less the total COGS. Calculate this on each case.

• Add up the gross profit for all cases and divide by 20 for

the mean gross profit per patient.

• Consider if this amount is better than nothing if you have

some empty exam slots. Compare to your gross profit

with private pay for routine exams – not medical.


� Market your practice!

� Invest in instruments.

� Website and Facebook page

� Online reviews

� Community outreach

� Host events in your practice

Marketing

� Customer service

� Community outreach

� Trunk show

� In office seminar, open house

� Visit physicians – extend discount

� Vision screenings

� Direct mail

• Groupon

• Reactivation

phone calls

(Brevium.com),

(Tip #510)

• Practice name,

logo, signage

• Website

• Social media

Your practice website

� The cornerstone of marketing now and in

the future.

� The internet is how today’s consumer

researches health care services and

expensive purchases.

� What image does your website project?

� Interactive – feature rich – impressive.

� Investment money and time: content, copy,

photos, videos.

� Not generic photos with fake people!

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Facebook business page

� An interactive networking site about your

practice

� Your website requires people to visit;

Facebook lets you push content out to the

public through fans.

� Word of mouth on steroids.

� Need for good content

� Events, promotions, contests, news

� Facebook only discounts

Facebook: personal page

Facebook: business page

Reputational marketing

� Online reviews

� This is huge – and growing!

� The power of the internet. People read and

respect reviews – do you?

� Positive and negative comments

� Ask patients “How was everything?” at

checkout

� $50 gift cards

Online communication services

� Solutionreach

� Websystem 3

� Demandforce

� 4PatientCare

� A broad range of services

� Provides Facebook app

• Appointments, reviews, promotions

Time to get serious about email

marketing

� How many patient email addresses do you

have? What percentage give it to you?

� How to get email addresses.

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Email or texting

� Recall notices

� Appointment reminders

� Glasses or contacts are ready

� Welcome to our office

� Please take our satisfaction survey or write a review

� Thank you for the referral

� Appointment waiting list

� Happy birthday greetings

� Practice newsletter

� General announcements and promotions

[email protected]

Documents

VEW 2015 Maximizing Practice Success through Optical 2010-2015 ... gross revenue in optometric practice. This revenue is produced with very little ... Do this and optical sales will