Vision Associates Set to Boost Dispensary Management Presence Among Indie ODs

WARREN, N.J.—The optical retailing landscape, especially for the independent ECP, is being buffeted by waves of change, as consolidation, new technology and an evolving patient mindset bring new challenges almost on a daily basis. In an effort to offset these challenges and support both the independent optometrist and ophthalmologist in today’s rough-and-tumble business environment, two optical dispensary management firms—Vision Associates and Partners in Vision—have come together as a division of Essilor of America to create a stronger entity in optical management.

Vision Associates was a company founded 25 years ago to provide expertise in both dispensary management and consulting services for busy ophthalmic practices, while Partners in Vision traces its beginning to 1999. Beginning late last year, the two firms moved to combine their resources and expertise under the Vision Associates name. (Both companies are part of Essilor as the result of previous transactions in July 2017). The firms historically have been more active in ophthalmology practices, but as a combined entity, senior executives now see a growing opportunity to manage dispensaries in the independent OD sector.

Today, Vision Associates is managing 208 locations across roughly 40 states, primarily in the Northeast region but spreading out rapidly. The combined entity reported collective dispensary sales of $68.4 million for 2018.

“In short, what we have done here is to look at these two entities and leveraged the best of both worlds to create an entity under Vision Associates that is stronger than ever,” Vision Associates president Pierre Bertrand said in a recent interview with Vision Monday. “And what we have realized is that the need that exists in ophthalmology also exists in optometry.”

Daniel Liberman, senior vice president, alliances and business solutions, at Essilor noted that part of the thinking behind this new combination stems from what the company has observed across other markets where independent operators have been faced with similar difficult business challenges and consolidating competitors. “When we look at other industries, in particular when we look globally, there are interesting things, such as what has happened to independent [ECPs] in Japan, when they didn’t have a partner to help them be successful,” Liberman said in the interview. “But we also looked at other industries and tried to discern what it is that causes independents to [struggle] and what it is that enables independents to succeed.”

In addition to Bertrand, the Vision Associates’ management team of the combined entity includes Joe Casorio, who is president of ophthalmology services, and Judd Sky, president of the OD services group.

Bertrand said he views the Vision Associates’ dispensary offering as “the intelligence” inside the ECPs’ optical department, which allows the optometrist or ophthalmologist to focus more holistically on growing the medical portion of the practice. He added, “We’re excited to say that the number of locations continues to grow and that the performance we are having [through these locations] is growing as well. We continue to be very, very strong in ophthalmology and we’re showing nice growth in optometry as well,” he said.

“We’re still in an early phase of this, but we’re seeing encouraging results for the growth of the business,” Liberman added. “The early indicators, I am happy to say, are very positive.”

Among the company’s recent organizational changes is a significant increase in the size of the Vision Associates team in the field. “We’ve made a tremendous investment to strengthen the regional management infrastructure,” Bertrand said. The firm also tries to retain a practice’s existing opticians and to provide them with access to the broader resources available to them under the Vision Associates umbrella and the regional management and coaching structure.

Six Operational Focus Areas
Bertrand explained that that the operational foundation of Vision Associates, and the way it creates value for partner practices, is based upon “six main buckets.” These are: staffing, an integrated supply chain, a retail management infrastructure, inventory management, guidance in navigating managed vision care and practice marketing. The marketing bucket encompasses digital marketing, search engine optimization and local marketing efforts, which might include trunk shows and community relations programs that drive new-patient traffic.

With respect to the supply chain, Bertrand said the goal is to simplify the supply chain for partner practices yet feature “the most innovative, most premium lenses in the market as well as a well-managed frame board,” where Vision Associates works with dozens of strategic frame partners and more than 4,000 SKUs that can be tailored to the best assortment for a particular demographic.

Liberman noted that the phrase “supply chain” can often be “a bit of a misnomer because you think it’s only the way that product gets to you.” Yet, he said, a true integrated supply chain “is really about how a practice chooses what it’s going to include in the assortment, how it will be presented and how the supply chain functions behind the scenes.”

In the hardware category, as an example, Liberman points out that Ace Hardware has become world-class from a sourcing and distribution perspective in a way that enables omni channel retailing and a more effective use of new technology. “They have a shared point-of-sale system and, maybe more importantly, their loyalty program in which you can go to one independently owned Ace Hardware and then go to another and still benefit from the shared loyalty program.”

As Vision Associates, the bucket built upon a sound retail management infrastructure includes a benchmark and best-practices function across all locations. (Central to this effort is a weekly dashboard report available to district managers and opticians that displays weekly optical performance on both a practice and district level.)

This allows the company to quickly identify the practices that are outperforming and take the learnings from these practices to other partner optical departments. “This is one of the reasons that we outperform the market,” Bertrand said. “We are learning not from one office at a time, but from hundreds of locations.”

Addressing another key area, Vision Associates maintains a dedicated managed vision care team at its headquarters that it couples with a revenue cycle management program to help maximize patient value and benefits. Understanding patient benefits (and denial rates) often is critical to a practice’s profitability, Bertrand noted. “We make sure that we can stay on the front line [across all things] that occur in managed vision care.”

In terms of staffing, Bertrand said the firm attempts to retain a new practice partners’ staff and then buttresses that with “floating opticians,” which he calls a “secret weapon.” These floating opticians can move into a practice to fill in when a regular employee is not available “so we’re always productive in the optical,” he added.

”Part of our promise is that we will bring training and continuous improvement to employees so they can become more successful,” Bertrand said. “We also surround them with an experienced and strong district manager who is there on a bi-weekly basis to train and develop.”

Inventory management is a critical bucket in that it enables independents to benefit from improved cash flow because they don’t need to invest in refreshing their frame boards multiple times throughout the year.

A ‘Market Spectrum’ of Choices for Independent ODs
One of the reasons for combining the two entities is to position Vision Associates to deliver the scale and infrastructure that independent practices—or independents in any retail-type business—require to succeed in today’s economic marketplace. The importance of a business partner to independent companies is readily apparent when one looks at other industries, Liberman explained.

One of the clearest examples of independents getting squeezed out of the market is the story of what has happened to independent pharmacists in the U.S. market who, for the most part, tried to succeed by standing alone. “They didn’t have examples [to follow] and they went it alone and [fought] on what is effectively a commoditized product,” Liberman said. “They tried to be a low-price provider against much bigger players, and that did not go well for independent pharmacists. On the other end of the spectrum [though] are things like hardware stores and businesses such as Ace Hardware (a cooperative organization),” he added.

“We want to work with our customers in the way they want,” Liberman said, noting that it’s important “to bring to the table these partnership platforms, tools and resources” that provide the most benefit to each independent partner. Liberman talked about taking a broader view at Essilor of a “market spectrum” of choices that optometrists can consider today. Among these are the choice to manage a traditional independent practice, taking part in alliances, exploring franchise opportunities or finding help with optical management.

“You can be a member of Essilor Experts and [receive] all of the benefits and the sophisticated marketing Essilor does on behalf of independents,” he said. “And then as you move into an alliance, you have all of the tools that they make available.”

These types of partnerships also create value, he said, when the partners can determine which components of service each is best equipped to handle and which are best “taken off your plate to potentially add more value than you otherwise would have added,” Liberman said.

Added Bertrand: “Our aim is, from the patients’ point of view, to make it as though we aren’t even there… There is no Vision Associates shop within the optical and the doctor’s banner stays the same. If you walk in to one of these practices, you feel like you are walking into a typical ECP’s office.”