Optometrists and Opticians

The retail optical industry in the US includes about 14,000 optician stores with combined annual revenue of $7 billion, and 16,000 offices of optometrists with combined annual revenue of $6 billion. Large opticians include Luxottica Retail (LensCrafters and Pearle Vision), Eye Care Centers of America, and US Vision. The optician segment of the market is fairly concentrated: the 50 largest chains hold about 60 percent of the market. The optometrist segment is highly fragmented.

Optometrists work mainly as solo practitioners or in small group practices. A typical group practice has less than $500,000 in annual revenue and four employees. About 1,000 practices have annual revenue over $1 million. Many optometrist practices include retail sales.

COMPETITIVE LANDSCAPE

Demand is driven by demographics, fashion, and changing healthcare practices. Most important is the aging US population, which is increasing demand for eye exams and glasses. The profitability of optometrist practices depends on efficient operations and whether they also sell glasses and contact lenses. There are few economies of scale in retail operations, except that large stores can offer a larger choice of product styles. Small retailers can often compete successfully with large chains by offering a different product mix. Eyeglass purchases are mildly cyclical with the economy, as many consumers view extra glasses as an expense that can be deferred.

PRODUCTS, OPERATIONS & TECHNOLOGY

Optometrists perform routine eye examinations, mainly to write prescriptions for corrective lenses, and can treat some ...