Optometry

Industry data

As of today, there are approximately 480 active optometry businesses. The average ratio of business per population is 1 per 4000 households, although in Tel-Aviv and the Dan agglomeration this ratio averages 1 per 2,100 households whereas in lowland and southern areas the average is 1 per 7,500 households.

There are a number of nationwide chains active in the industry.

 

Industry Sub-division

  • An optometrist is authorized to conduct visual acuity tests, prepare eyeglasses, sell all optical products, and distribute contact lenses.
  • An optician is authorized to prepare eyeglasses according to prescription and sell sunglasses.

Neither an Optometrist nor an optician is allowed to diagnose ailments or provide medication.

 

Market Characteristics

The market is comprised of both stores and clinics. Stores emphasize sales, whereas at clinics the emphasis is on visual acuity tests and fittings. Products sold in optometry businesses include eyeglasses and contact lenses, sunglasses, frames, and solutions. Services rendered include visual acuity tests, fittings eyeglasses and contact lenses, examinations, and repairs.

 

Customers: Defining the Target Market and its Size, Market segmenting

Potential target market is comprised of the general sight impaired population, with no correlation to socio-economic situation, gender, or any other parameters, although there are a number of unique segmentation groups: children under the age of 6, elders over the age of 60, IDF soldiers.

Age, gender, and income levels will affect the quality of lenses purchased: frame design, material, and the price the customer will be willing to pay.

 

Competition

Competition stems from private stores, chains, and Kupot Holim stores. In addition, some products are sold “over the counter” at retail stores and drugstores.

 

Vendors

  • Most eyeglass frames are imported.
  • There are two factories manufacturing ophthalmic lenses in Israel. In addition, there are a number of small manufacturers and imported lenses varying in extent.
  • There are three contact lens factories in Israel, which in addition to manufacturing, also engage in import and marketing. A number of private import and small factory manufacturers also exist.

 

 

Marketing resources

An optometrist is only legally allowed to advertise his or her professional services according to ethical limits. There are a number of typical marketing resources in the industry: shop-window design and sign display, advertising products and services that do not fall under the advertisement limits, distribution of promotional products, free visual acuity tests, etc.

 

Factors Affecting Success:

Location, competition, professionalism, reputation, specializations and prices.

 

Entry Barriers

Undergoing Ministry of Health training and acquiring appropriate license. Initial investment.

 

Human Resources:

Optometrist- required.

Optician- hired employee or contracted worker.

Sales clerk.

 

Required Equipment:

Basic equipment required in order to start a business within the industry: trial frame and lens case, projector, an examination unit, slit lamp, keratometers, autorefractometer, optical equipment for eyeglass preparation, topography and a foropter. In addition to professional equipment, investment in computers and furniture is required as well.

 

Funding:

Industry revenue and profitability

General profit percentages in the industry:

Lenses- 67% -87%. As lens complexity grows, profitability decreases.

Frames- 50-63%

Placing orders for frames and lenses- 57-7-%

Contact lenses- 82-92%

Solutions- 34-38%

Sunglasses- 48-58%

 

Typical Terms of Payment

Vendors: Generally, vendor payment terms are according to EOM +60. Business owners are normally eligible for gifts and benefits, such as subsidized participation at expositions.

Customers typically pay using various credit cards.

 

 

Risk Level:

The high threshold, required professionalism, and exclusiveness of the acquired equipment puts a business of this type at a higher than average risk level.

 

Licenses and Certifications:

A professional Ministry of Health license is required in the optometry industry.

A business license is not required, unless the business is active within a shopping mall and is not represented by a management company.

 

Insurances:

Business insurance (for content and inventory), third party insurance, professional responsibility insurance, employer’s liability insurance, and loss of income insurance. In addition to the above, an insurance agent should be consulted in regards to the need for additional insurance.

 

Relevant Addresses:

Board of Optometrists, P.O. box 2826 Tel-Aviv. Phone: 03-5602612,               03-5602545, 03-5602648.

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