business advisor

Most Optometrists Are Optimistic

Forget the barrage of negative reports. Optometrists see a strong year.

JERRY HAYES, O.D.

I recently conducted an online survey of several thousand private-practice optometrists, and I received 328 responses, which I consider outstanding.

Comparing 2008 to 2007

Except for real estate, the economy was ok through September 2008. Then, the stock market crashed in October, and consumer spending dropped in November and December.

The purpose of this survey: to see how private practices performed in 2008 and specifically in Q4 2008, when consumer spending dropped. Could independent eyecare providers somehow defy gravity in the face of weak economic conditions?

Survey demographics

Of the 328 respondents, 31% reported grossing more than $1 million at their primary location, and 49% grossed more than $750,000. A total of 46% of respondents said they practiced more than 20 years, while 70% said they practiced more than 10 years.

Strong performance

When asked, "How did collected gross revenues in 2008 compare to 2007 at your main location," I received the following answers:

► 246 out of 328 practice owners (76%) reported revenues grew.

► 162 practices (50%) reported at least 5% growth.

► A total of 9% reported flat revenues, and 15% reported decreased revenue.

When asked, "What would your best estimate be if you compared collected gross revenue for just the 4th quarter of 2008 to the 4th quarter of 2007," I received the following answers:

► A total of 60% reported growth.

► A total of 39% reported 5% or more growth.

I expected more practices to be down. On the other hand, 12% were flat, and 27% reported decreased revenues in Q4 2008 as opposed to 15% being down in Q4 2007.

O.D.s are optimistic for 2009

When asked to predict their financial performance for 2009, 64% of respondents said they expect gross revenue growth in 2009.

Twenty percent expect to break about even in 2009, and only 16% think their revenues will decrease.

I think it's a great sign when 84% of respondents expect to be even or show positive growth in a severe recession.

The last question asked: "How is morale? How would you gauge your attitude concerning your practice performance in 2009?"

Again, respondents were very optimistic. Twenty percent said, "What recession? I'll be just fine."

A total of 56% predicted a tough year, but said they weren't worried. Only 24% reported concern about the 2009 financial performance of their practice.

My thoughts

Admittedly, our sample is small. But, 328 practices represent more than 1% of all O.D.s.

Consider this: The January 2009 Conference Board Consumer Confidence Index, which is near an all time low at 37.7, is based on the response of only 5,000 consumers.

Using that rating, one could accuse the vast majority of our 328 responding O.D.s of being wildly optimistic in the face of this negative media barrage. That's a good thing, and it makes me proud to be an O.D. Success is largely a result of one's attitude. Most of our profession seems to be very positive about the future. OM