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Staying Profitable In a Down Economy
by Bret Davis
When is the right time to purchase an edger? When will my practice be profitable enough to be able to afford an edger? Over the years I've often been asked these questions, and my answer has always been the same: If you want to save money and become profitable, start finishing your own work.
News on the down economy is everywhere. If your practice is feeling the pinch of a slow year, there is a solution: edging equipment.
Sending your finishing work to an outside lab is the same as sending your car out to be detailed or having a service clean your house. When money is tight, do you have your car washed or wash the car yourself? Do you hire a cleaner or clean your house yourself? Having an outside company do your lens finishing work for you is more expensive even after factoring the cost of equipment.
For example, in-house edging reduces lab bills by 30 to 50 percent. At 40 percent with a monthly lab bill of $8,000, the savings is $3,200 a month. If you factor in a state-of-the-art edger costing about $1,000 per month, you're still pocketing $2,200 every month after all costs.
We certainly have seen our sales grow in times of economic slowdown or uncertainty. Most ECPs realize that if they need to make cost reductions, the lab bills are the quickest, easiest way to find immediate relief and profit growth. We've found that the majority of ECPs have done their homework and drilled down on their lab bills, realizing savings along with the benefit of patient growth due to the increase in patient service.
Before you make changes in personnel, marketing, or elsewhere, take a look at reducing your costs in the part of your practice that represents 70 percent of the money generated: the dispensary. If you're already edging, consider the work you still may be sending out, like drill mounts and high-end coated jobs, all which can be edged in-house with a number of new edgers on the market today.
So as the election comes to an end, and the new political administration wrestles with the economy, the only true win-win I see for those of us in the small business world is to take steps like upgrading or adding finishing equipment to our labs to ensure our future prosperity regardless of where the economic road leads us.
Bret Davis is president of Briot USA
DEBUNKING Misconceptions |
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1 "Drill mounts are expensive to produce no matter who does the work." In some areas, sending out drill mounts can cost $30 or more per job, and you still have to put them together. The average practice will sell one drill mount a day. At $30 multiplied by 22 work days in a month, keeping those jobs in-house saves a minimum of $660 per month. 2 "The practice staff doesn't have time to run an in-house edger." If you factor in the times your staff is on the phone and/or computer with the lab tracking down jobs for patients, and compare that with the four to six minutes it takes to edge your own job, it's clear that your staff has time to edge in-house. |