BUYING AND maintaining your frame inventory is an ongoing, significant investment, as it is one of the top three expenses you will incur at your practice. To be successful and profitable, think of your frame boards as an apartment building that you manage. Every displayed frame is an apartment, and the frame that resides in the apartment is considered the renter. This perspective will allow you to make more analytical (vs. emotional) decisions in your optical.

MAP IT OUT

If you want to have successful total frame board management, plan how you will allocate your optical offerings. For example, let’s say your boards can display 600 frames. Right off the top, dedicate 20% of your board space to high-margin product (HMP). HMPs are frames procured at 60% or more off the wholesale cost. 600 x 20% is 120. We have 120 units dedicated to HMP frames. If we subtract 120 units, we now have 480 spaces left to showcase frames.

HMP is one of a number of categories. Separate your frame inventory into the following categories, and convert your count into a percent of total board space.

Tier 1. High fashion and recognizable brands. These names hold value and are generally not affordable for the average consumer in clothes and handbags, but they are affordable in high-fashion frames. Examples: Calvin Klein, Gucci, Prada, Dior and Chanel

Tier 2: Moderate fashion or sports brand that has value, but is not so expensive. Examples: Nine West, Banana Republic and Nike

Tier 3: Known names that are not considered high fashion, but have widespread awareness among consumers. Examples: Sketchers, Revlon, Cover Girl and Pepsi.

Niche. Fun and unique frames. Examples: Prodesign, Silhouette, Bevel.

Core. Frame manufacturers, such as Marchon, Safilo and ClearVision, all have a core brand. Choose one; not three.

Luxury. Very high-end. The number of units will vary depending on contractual requirements. Example: Cartier and Lindbergh.

Non-branded. Not a brand of any type, but it sounds like one. Example: Scott Harris, Michael Ryan and Ellen Tracy.

HMP. As described above.

(See chart, below, for an example of how one O.D. has categorized his frames.)

DON’T BUY YOUR GRANDMOTHER’S FRAME

The right number for your allocation should coordinate with your patient demographics and wants. Run a patient age and gender report from your practice management system to align your decisions. Additional information can be found by using Google to assess your local demographics, income levels and diversity of culture. Are you in a high-end area? Do you find that a large percentage of your patient base is comprised of kids? Ethnicity, location, surrounding businesses, along with popular recreation and sporting events in your area will influence the choices your patients make. This does take some work and some planning, but since the optical is a majority of your revenue in many cases, it is critical to take time to make sure you are renting all the “apartments” that you can to have what the consumer wants.

There is no lack of product in today’s marketplace, and there is definitely something out there for everyone. And, let’s face it, no 25-year-old is going to want to buy her mom’s — or even her grandmother’s frames — unless they want a fun Saturday frame. So, get out of your comfort zone, and go have some fun. But, keep the overall plan in mind.

COMMIT TO LESS IS BEST

Frame buying can be a lot of fun! Resist the temptation to buy a few frames here and a few frames there, ending up with a hodgepodge of 75 collections.

Instead, commit to the mentality that more of less is best. Ideally, you want a minimum of 30 units per collection. Remember that hodgepodge of 75 collections? We just reduced that to 16 collections (480/30 = 16). Of the 16 collections, eight collections should be geared toward women, five collections for men and three unisex collections. This may vary slightly, depending on patient demographics.

Bonus: By holding more stock of less frames, your practice will represent more of an investment to your frame reps, who will then be more attentive to your frame board management. Healthy relationships in business and eye care are key.

PRICE FOR SUCCESS

Establish a pricing system in your practice. Begin by identifying your minimum list price (MLP). The MLP is defined as the lowest a frame will be offered to consumers, regardless of what the practitioner pays for it. Variables, such as location and demographics, will affect this from one practice to another.

Next, identify a multiplier that works for you. In this example, we’ll use three. Multiply your cost for the frames by three to get your price for the frames. Ensure that this number ends in nine. Here are two examples:

1. $40 cost x 3 = 120 + 9 for a price of $129.
2. $60 frame cost x 3 = 180 + 9, for a $189 price.

If, for example, you set a minimum price at $159, then the frame in example one would have a price tag of $159 because it does not meet the MLP. The frame in example two would be priced at the $189, found in the equation.

BEGIN AGAIN

With your frame inventory categorized and mapped out, begin with a fresh start. Work with your frame representatives — and back up with analytics, i.e. turnover rate — to continue to cull your frame inventory and, as a result, this ongoing investment into your practice. OM

MR. BINKOWITZ is creator of GPN, a company that provides independent practitioners with business management tools, and founder of The EDGE. He has extensive experience in retail operations, merchandising, marketing, manufacturing, distribution, technology development, national sales and on-site interactive consulting. He is an adjunct professor at Houston College of Optometry, where he served for two years as the Benedict professor.

MS. PELKEY is regional lead and the business services trainer with Total Eye Care Partners. She is a licensed dispensing optician in the state of Virginia and holds an endorsement to fit contact lenses. She enjoys helping future opticians become successful in all aspects of the industry.