DEFINE THE METRIC: Patient’s Own Frame
“I want to re-use my frame and get new lenses.” That’s a phrase heard in every optical dispensary on a regular basis. We all know it ‘costs’ in terms of potential revenue to lose the frame sale, but how much, in reality, does it actually take out of our bottom line? We refer to lens-only sales as POF (Patient’s Own Frame), and what it ‘costs’ varies from practice to practice. The raw fact is that it costs every practice something.
POF may represent one of your biggest potential areas for improving your revenue stream. It’s also “low-hanging fruit,” meaning it’s easy to see and easy to improve. While you won’t overcome the objections of every patient that wants to re-use a frame, you can definitely implement strategies for addressing this hurdle with your patients.
WHY IS IT IMPORTANT?
It’s important to not only keep track of your POF sales in general, but also to break the overview number into its various components. High POF sales (upwards of 20%) can indicate a number of possible issues (and potential solutions). Drilling down into the details can help you pinpoint the reason underlying the conditions under which those sales are most frequently occurring. Resolving issues begins with understanding them. Understanding them at the granular level will give you a serious advantage as you work toward reducing the frequency of POF sales.
There are several potential areas of focus that may surface during a deep-dive into your POF details:
- Pricing strategies may need to be adjusted;
- One or more of your sales team may need to beef up their skills in overcoming objections;
- It may be time to look at your frame warranty policies. (Do you only provide warranties for complete pair sales, or are you still warranting every sale?);
- One or more of the doctors may need to change the way they answer key questions in the exam room, like “Can I just get new lenses and keep my frames?”
Even in a smaller practice, improving your POF sales by a few percent can easily change your revenue by over $1000 a month.
HOW TO TRACK IT?
Your POF percentage is calculated as the number of lens only sales divided by the total number of eyewear sales (complete pair and lens-only sales).25 / 100 = 0.25 (25%)
To compute the lost revenue in your practice, you’ll need 2 numbers:
- The number of lens-only (POF) sales;
- The average frame price in your practice;
Once you have this information, it’s really just a math question – multiply them together to understand what your POF sales are taking away from your practice revenue during a given period.
If there were 25 POF sales, and our average frame price is $129, then:
25 x $129 = $3229
If we can improve our POF by 5% (from 25 to 20 frames of 100), then we can expect to add about $645 to the bottom line.
EDGEPro makes this a little easier – POF is one of the 4 key metrics calculated on your Opportunities Dashboard.
Be sure to dig in to the details of this overview number. Use the “explore” feature to understand all of the calculations, as shown here.
The next stop in evaluating your POF sales is to take a look at the Frame Report. Use the “By Staff” button to arrange the data as shown here. Keep in mind that the most important number is not the quantity, but the percentage of overall sales. You should be able to identify which of your staff, if any, could benefit from additional training in this specific area.
While you’re on this page, do an overview check “By Plan” as well. You are looking for evidence that a high number of patients in any given plan are choosing not to take advantage of their frame benefits. (Keep in mind that we expect private pay patients to have a higher percentage in this KPI.)
Review the performance of patients by doctor as well. Access the Price Point Matrix for these statistics. Use the doctor drop-down to check the incidence rate of POF sales. Compare the percentages against each other to see if any practitioner has a higher – or lower – rate than is typical overall. Chairside language can have a significant impact on the sales results in the dispensary, and POF statistics are no exception.
Once you have begun investigating the details of your POF performance, you should be able to form a picture of when and how those sales occur. You’ll be able to create a plan to begin improving those numbers and start realizing the extra dollars they represent in your bottom line. Come back and check the statistics regularly as part of your plan.