Branding Your Own House Lenses

By Brian Boddy, Acoma Optical
In the last 10 years one foreign owned progressive name has dominated all markets and has been written at the bottom of over 30 percent of ECP’s Rx pads in the United States. Lab values were based on whether you could wholesale this branded progressive and every lab sought ways to surface this product in their own labs. Today we live in the 21st century and brand loyalty commitment is now reduced to value and satisfaction, which has opened the doors to the designer lens market.

Independent labs and ECPs can finally have hundred of options at their fingertips to correctly fit the consumer with precision machine-tailored lenses produced to satisfy their exact visual needs, all while tripling their profit margin and keeping the hard earned dollars at home.

Why did I choose to brand my own in house progressive vs. branded?

• Profitability: I can choose my lens cost and design cost to fit my customers and their budgets.

• Flexibility: I can make progressives out of any polymer material in almost any base curve.

• Speed: I no longer have to rely on vast and comprehensive stockroom lens inventories and lens manufacturers. Notoriety: My name and brand are stronger in my local market than most lens names. The last thing I wanted to do was perpetuate another brand name that my competition could just as easily get locally, nationally or worse the consumer can get over the Internet, then beat me up on price or the manufacturer eventually moving in and competing against me.

• Independence: I have the ability to think outside the box and decide what is best for the patient and allow them to choose multiple solutions for roughly the same prices as the ones we had before. The dilemma I had was how could I offer my customers perfect progressives in any reasonable prescription with the least amount of inventory in the least amount of time? I also had limited space and limited production pairs to return my payoff.

Because of these factors, it was very important for me to get the correct solution the first time. My solution to reduce my capital outlay and enter into the free-form designer lens market with the CC Systems Labzilla lab management system (LMS) that would mate up with my existing Innovations software (preventing double entry), LOH blocker 2000, Satisloh Vft compact generator with on machine engraving and the Toroflex soft polisher.

I used all the standard production spreadsheets to calculate payoff and begun to call on the 80 or so reference labs CCsystems and Satisloh had recommended. Introducing myself as a small independent OLA retail lab was extremely helpful and everyone I was able to get in touch with were very candid about their software, equipment and ultimately their free-form experience. I asked the following criteria questions to the reference labs:

• Are you consistently producing free-form lenses at the quality and speed the manufacturer claimed?

• Are your lens designs reliable and consistently re-producible?

• What was your experience with the field technicians during installation, phone support and how long did it take them to return calls and address problem areas after the installation?

• Were your lens software designers and equipment designers constantly updating and providing new optimized solutions with your existing equipment and software?

From the LMS and equipment stand point (after hearing how the labs answered my questions) it was an easy decision whose products we were going to purchase. My donor lens inventory was easily figured out because we would drop all of our pre-molded progressives (up to 30,000 possible lenses if we stocked every material and brand) to less than 360 lenses in various materials and tint options in every material made. This was a powerful deciding factor.

The lens design software was a different story. I heard one comment over and over again; free-form lenses were complicated and click fees were expensive. After speaking with the “usual” lens suppliers and verifying the free-form backside patent requirements from Seiko, I found the complications to be true. Only one free-form lens designer did not call me back (because I was predominantly retail) all the other “brands” simply told me they were not setup to offer free-form outside their network labs, but all gave me a per click lens fee price. In this process I was told that we needed to execute a backside patent license agreement with Seiko that “grants me the right to produce 100 percent back surface free-form PALs and requires a $2.60 royalty fee per pair.” The lens design click prices varied but most were comparable to existing molded lenses without the lens material!

I knew my volume and the cost of the equipment plus overhead and easily concluded the margins were too tight for me to assure payoff of my capital outlay especially if we paid those premium click fees. This is the one variable that I knew could make or break me so I began to pursue lens designers that offered generic or unbranded lens design software. I settled on two software designers and picked IOT America (the other asked me not to disclose their name in this article because I did not pick them) because they proved to be a less costly solution, interfaced with 90 percent of LMS software, had a solid past in design and development, and allowed me to place my name on all their lens designs.

• My reasoning for picking IOT America was for the following reasons:

• Reduced installation time in LMS integration through increased training and support as testified to by real world independent labs.

• IOT does not charge click fees for the first 60 days after initial installation, which gave me time to develop my market and fine tune our free-form production.

• The widest range of free-form lens designs including single vision, progressive, office, reader or pre-presbyope of any other branded or unbranded lens design manufacturer.

• The ability to “paint” a progressive on any donor lens in any material including CR-39, poly, mid-index, hi-index, Trivex, Transitions, polarized or any other lens that is on the market or has yet to be created because of their commitment to ongoing research and development.

• Unique de-centering and lenticularization techniques for wraps and/or high minus jobs that gives me a wider range of base curves to solve my wrap issues.

• Hard or Soft progressive designs with variable fitting heights and corridor lengths.

• Basic designs, advanced designs with User Power Optimization (compensated power that recalculates the OC in a wider area) and Ultimate (individualized) designs with patient frame measurements (vertex, panto, panoramic etc.), viewing angles and lifestyle.

• Detailed marketing materials, progressive breakdown charts that compare other brands and brochures that allowed us to brand with our valuable name and give it out to ECP’s and patients. This marketing and printed training is a great asset and saved our lab much time and expense bringing our staff and ECP’s up to speed.

• I could calculate all my progressives in-house on our computers. Some lens designers place a stand-alone computer in the lab and utilize the Internet to calculate the lenses in their home office then send the lens design calculations back to the lab.

• Finally we ordered about 100 pair from a wholesaler who was currently producing the IOT lenses and asked consumers to decide how the progressive compared to their current molded or digital lenses.

Now that I have detailed out how I arrived at our solution let me explain how the software click fees work: Free-form Lens Cost = Material + Click Fee + Royalty Fee. For example, if XYZ optical orders a pair of free-form progressive lenses, then Labzilla (our LMS) prompts us to pull a set of semi-finished single vision lens blanks in the ordered material that have been calculated for the optimal free-form base curve. The software keeps track of our $1.30 per lens click fee that will ultimately be paid to Seiko and will also price out the free-form progressive design costs that are to be paid to IOT for the desired type of lens. This lens cost is negotiated and contracted in advance usually incorporating the volume pricing standard.

For this article I will use a per pair price of $8 for basic or customized back, $10 for advanced or design that takes into account the frame measurements and $15 for ultimate or a progressive that takes into account all of the above and position of wear. What was hard for me to wrap my head around was how to expense each lens. I finally resolved that we would calculate the cost of the progressive with click fees and material fees and place that into our equipment spreadsheets the same way we would have with molded progressives with one exception: I negotiated that all re-do click fees would be at no charge; on paper (and now in production) this dropped my lens costs and re-do margins considerably. So for example a basic CR-39 lens at $5 per pair material cost would be:

• Basic design: $5.00 + $8.00 + $2.60= $15.60 for a machine produced progressive.

• Advanced design; $5.00 + $10.00 + $2.60= $17.60 for a machine produced customized progressive that takes into account fitting height and frame parameters.

• Ultimate design; $5.00 + $15.00 + $2.60 = $19.60 for a machine produced customized, framtized and position of wear compensated progressive.

These figures can be significantly higher depending on your lens design vendor, and while my click fees do not change by material, some do. These lens figures then went into my machine vendors’ spreadsheets to figure out equipment return. My free-form investment was easier to realize because overheard, reduced size of production equipment, reduced inventory, labor and equipment expense were almost always reduced when the lower cost of progressives where introduced into the equations.

I still needed to develop a name and asked a graphic designer to come up with a logo that I could trademark. The Santa Fe Lens logo was created. I used an attorney to submit all the forms and eventually got my wholesale logo trademarked for less than $2,000 (some firms do this for considerably less).

I trademarked my logo to make it more recognizable and establish a clear national symbol of who we were and where our lenses originated and it also saved me long term frustration by making sure my name and logos did not infringe on any other lens vendors names in the United States. Another important criterion was placing that logo onto your customized progressive lenses (in other words pick a logo that looks good and is easily placed on your progressive).

I submitted my pre-trademarked logos to Satisloh who graciously engraved them on different lens materials in both, on machine and laser engraving formats for us, ensuring that my logos would be re-producible in our lab. I have the advantage in our market area where my name is stronger than any lens “brand” name (until I wrote this candid article). Now I utilize the Santa Fe Lens name to encapsulate all of our progressive designs as a trusted independent source for lenses in our retail literature.

Independent branding gives power back to the labs at a local level. The local lab should still be the lens expert because they offer an un-biased lens suggestion approach that draws from many manufacturers and their ability and understanding on how to process those lens designs and champion the merits of each lens based on experience.

CURRENT ISSUE


May/June LabTalk 2017