Strategies for Successful Inventory

ManagementNote and Exercise Book

Strategies for Successful Inventory Management - Note and Exercise Book

Importance of Optical Sales for Practice SuccessFor many practices, optical sales (including lenses, frames, plano sunwear, and OTC readers) account for around 68% of total practice revenue while comprehensive eye exams only account for about 15%*. This illustrates how important optical sales are to a practice’s financial health, and what a large impact it can have both positively or negatively.

Your Practice’s Percent of Annual Sales by Category

Average Percent of Annual Sales by Category

1. Comprehensive Eye Exams - 15%

3. Refractive Surgery - 5%

2. Contact Lenses - 12%

4. Optical Sales - 68%

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Fill out the chart below to compare your percent of annual sales by category with the industry averages shown above.

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Zyloware as Your Business PartnerThink of us as a business partner to help guide your purchases, assist in managing your inventory, begin training your staff on brands you carry, and in the end help grow your sales. With a strong focus on the community, we embrace that our employees along with our suppliers and most importantly you, our customer, make our success possible. Our #WeAreZyloware campaign showcases our focus and investment into your practice’s success.

Zyloware Account Manager:

Email: Phone:

Strategies for Successful Inventory Management - Note and Exercise Book

Calculating ROICalculating and analyzing your return on investment (ROI) is key to determining growth opportunities for your practice. Use the equation below to calculate your ROI.

(Gross Revenue of Product - Cost of Product)

Cost of Product= ROI =

Date Range = Gross Revenue of Product = Cost of Product =

Calculating Capture RateCapture rate is defined as the numbers of patients who received an eye exam in your office and purchased their eyewear from your optical. Use the equation below to calculate your capture rate.

Total Number of Purchases

Total Number of Examsx 100 = Capture Rate x 100 =

Date Range = Total Number of Purchases = Total Number of Exams =

What is the total number of frames you have in your optical?

How many SHOULD you have?

Strategies for Successful Inventory Management - Note and Exercise Book

Calculating TurnoverInventory turnover refers to the number of times inventory is sold or used within a specific time frame, such as a year. Use the equation below to calculate your inventory turnover.

Total Number of Frames You Carry

Total Number of Frames You Sold= Turnover

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Total Number of Frames You Carry =

Total Number of Frames You Sold =

Types of Patients Determine which segment or product category is your biggest opportunity, and give them the most focus in your frame inventory. Rank each of the patient types below by importance to your practice. Are image patients the majority of your current patient base or your target consumer? If so, mark the circle next to the image patient with the number one.

Image Patient• Buy products to look or

feel better • Cost and exclusivity adds

to value• Small section of inventory

Quality Patient• Value quality and

workmanship• High-end technology• Expect superior service• Most loyal patient base

Value Patient• Care about price• Will pay more when value

exceeds perception of price and worth

• Will buy above Managed Care Plans

Budget Patient• Always hunt for lowest

price even if it means in-convenient travel or wait

• Small portion of patient base

• Contribution to practice profit is small

Strategies for Successful Inventory Management - Note and Exercise Book

Choosing Your Inventory MixFor proper exposure of Zyloware brands in your optical, carry 16-24 pcs chosen based on your customer’s preferences and demographics. With these frames, always buy deep into a brand instead of wide.

Take a look at the following Randy Jackson frames from his eyewear line. When looking through these frame, which ones would you choose if you needed to create a collection of five frames within your optical. Circle the frames and color of each that you would choose to carry in your optical based on this discussion.

Randy Jackson 3036 - Blue Crystal Randy Jackson 1062 - Black Randy Jackson 1074 - Brown

Randy Jackson 3036 - Grey Crystal Randy Jackson 1062 - Grey Stripe Randy Jackson 1074 - Navy

Randy Jackson 3036 - Matte Tortoise Randy Jackson 1002 - Gun Metal Randy Jackson 1074 - Black

Pricing TiersWhat four tiers would you set in your office based on current sales and target audience?

Tier 1BASIC

GOOD

BETTER

BEST

Tier 2

Tier 3

Tier 4

Strategies for Successful Inventory Management - Note and Exercise Book

Pricing for Your Patient TypeCreating different price tiers separates your products into predetermined groups that are more appealing to patients and therefore more easily sold. Think of these tiers as good, better, and best categories and prices. Review the below patient type and write down the price you would like to set for that patient tier to help you develop your pricing structure.

Image Tier• Buy products to look or

feel better • Cost and exclusivity adds

to value• Small section of inventory

Quality Tier• Value quality and

workmanship• High-end technology• Expect superior service• Most loyal patient base

Price = $

Price = $

Price = $

Price = $

Value Tier• Care about price• Will pay more when value

exceeds perception of price and worth

• Will buy above Managed Care Plans

Budget Tier• Always hunt for lowest

price even if it means in-convenient travel or wait

• Small portion of patient base

• Contribution to practice profit is small