Optometric Management Tip # 214   -   Wednesday, February 22, 2006
How to Sell Second Pairs

I wrote in my last tip article about how discounts can be very bad for the bottom line, and that most eye care practices would do well to simply eliminate the wide variety of discounts offered to patients. This week Iíll describe the one discount program I believe in. Try this strategy and you will increase your net income.

If you have an optical dispensary in your practice, I would venture that you like to see patients purchase two complete pairs of glasses at the same time. Three or four pairs would be even better. I will go out on a limb and propose that you probably donít see all that many double pair sales. If your practice is like mine used to be, you might even agree that a two pair sale is a rarity.

A radical idea

Iíll admit that my practice was woefully poor at selling two pairs at once. Itís not like we didnít try the usual approaches. We provided training programs on optical sales techniques and my staff has always been very good at lifestyle dispensing. We also offered the usual 20% off on the second pair, which has become almost a standard in the optical marketplace. One day, while commiserating this history of mediocre performance with members of my study group, a doctor from Georgia who has a brilliant mind for business said ďIf I wanted to sell more second pairs, Iíd make the second pair 50% off.Ē It seemed a little extreme to me; after all, there was no point in selling the second pair if there was no profit in it. But with a little analysis, it turned out that the concept had merit.

I introduced the policy in my practice and multiple pair sales jumped dramatically. Instead of selling two double pairs per month, we were selling two sets per day!

The rules

The second pair discount policy in my practice is simple, but strict. Looking at the profit

Earning a smaller profit on many second pairs can be far better than earning a typical profit on very few second pairs. But the best way to tell is to track the numbers in your practice. Monitor the number of double pair sales over a few months before and after offering the 50% discount. Calculate the gross profit both ways. Remember that you are probably already giving up a 20% discount on second pairs, so the real cost of moving to this dramatic policy is 30% of the usual charges.

To obtain a rough overview of the concept, review the dollar profit on a pair of glasses sold in your practice with a 50% discount. Donít forget that you likely received a 20% discount off the published wholesale frame cost. Start with your usual charges for an average frame (letís say Frames book price of $45) and a pair of progressive lenses and take half that amount off the top. Next, deduct your actual lab cost for the frame and lenses. You should end up with a pretty good gross profit in spite of the very aggressive discount. In my case, the profit after the discount would be $140. I have an in-office surfacing and finishing lab, so I admit my costs are low which helps my profit margin. But that option is available to any practice. If your profit is very low in this scenario, you might need to consider raising your optical prices.

Economy of scale

It is more efficient for my staff to process two pairs of glasses at once, which makes the reduced profit on the second pair even more acceptable. Everything occurs in one transaction at the same time: orders are written up, charges are entered and paid for, materials are gathered, lenses are fabricated, patient is called, and glasses are dispensed. Patients rarely need a reason for a bargain, but if asked, this is how I explain our second pair policy.

Why the program works

The increase in second pair sales in my practice occurs because it is a good financial deal for patients, but there is another important factor at work. My staff feels a duty to inform every patient about the policy. It is simply too good of a deal to not bring it up. This at least plants the seed of buying two pairs, and given that, many people will. Even if the patient declines, the staff member does not feel badly about mentioning it. When we offered a 20% discount on the second pair, it was often only brought up if the patient asked about getting two pairs. The 50% discount avoids the fear of rejection that prevented staff from discussing two pairs. Now, the second pair could be a pair of computer glasses, Rx sunglasses, single vision TV glasses, dressy fashion glasses, or any other reason you come up with.

Three ways to make money

There are only three ways to increase your gross revenue.
  1. See more patients per day
  2. Raise fees
  3. Sell more goods and services to each patient you see
All three of these are important, but if numbers 1 and 2 are maxed out at the moment, donít forget number 3!

Best wishes for continued success,

Neil B. Gailmard, OD, MBA, FAAO
Chief Optometric Editor, Optometric Management