I love a simple idea that makes money and that's what I have for you today. This is under the category of why didn't I think of that sooner, but better late than never. I'm sure some of you are already doing this, but if you aren't, you're going to like it.
My practice recently implemented a small price increase for contact lens products. I monitor our profitability on the product side and we need to pass along wholesale price increases that occur every year or so. As we were printing up new price lists to distribute to staff members and various locations around the office, I realized that patients often ask us the price per box. Some of these patients compare prices with online sources or other places. Many services and products sold in our offices are not very price sensitive, but contact lens products can be.
The price quote
Our practice has a policy of discounting contact lens products by 10% if the patient buys a full year supply. I find this to be quite effective. Most patients want to buy their lenses from our office and they respond well to the discount and opt for the full year most of the time. We also help the patient to obtain the manufacturer's rebate they are entitled to with a full year supply. The light bulb went on for me that we should quote contact lens prices to patients after the full year discount and rebate, expressed as a per box price.
Our office (and I think many others) does not usually quote the price this way because every manufacturer has different rebate amounts and the rebates change from time to time. A pretty weak reason, don't you think?
To be clear, we do not typically quote the price per box unless we are asked. We prefer to not talk about boxes at all but rather a full year supply of lenses. My staff is trained to simply say "your full year supply of contact lenses after your discount and rebate is $XXX." When patents ask what the price is per box, we say "The price is $XX per box after your discount and rebate." We used to quote our price per box and then mention that there is also a full year discount of 10% and also a manufacturer rebate. But the patient only heard the first price and the discount was vague and not calculated as a dollar amount. Our new way is better.
This process of quoting the price after rebate and discount is easy to do if you simply put it on the price list in parentheses.
Our contact lens price list is stored on a spreadsheet on all our office PCs, but we also rely on a low tech method for technicians to have prices at their fingertips. We print the price lists of contact lenses, all exam services and all optical products on paper, then we shrink the size on our photocopier, and we laminate the sheets to become pocket cards. These cards are about five by seven inches and we punch a hole in the corner and put them on a ring.
Our contact lens price list provides every factor the technician needs to know. Here are the columns that run left to right on our list:
Lens brand name.
Recommended replacement period (daily, two week, monthly, etc.).
Our price per box.
How many boxes make up a full year supply.
The total cost for a year supply before discount (helps us write up the fees).
The total cost for a year after our 10% annual discount and the manufacturer rebate.
The price per box after discount and rebate.
With our price per box after discount and rebate, we are quite competitive with online sellers and big box stores. Once you show patient s you are in the product price ball park, most will buy their lenses from your practice.
Best wishes for continued success,
Neil B. Gailmard, OD, MBA, FAAO
Editor, Optometric Management Tip of the Week
Dr. Gailmard's new book, Practice Management in Optometry: A Blueprint for Success Based on the Optometric Management Tip of the Week, is now available on Amazon.