Putting Real Math to Frame inventory profit
We often wonder and speculate what our frame margins actually are amidst the muddy waters of frame reimbursement formulas and charge-backs.
Recently I plugged in some common insurance formulas into some software and the results were shocking.
1. With standard frames acquired at discounts between 10-30% off wholesale, profits are flat until you exceed the plans wholesale allowance for frames.
2. We also found that most practice models incorporating budget and standard frame styles saw a profit decrease near the wholesale allowance.
3. Lastly we compared the profit of Marchon and Altair frames with standard frames. We found that if non Marchon/Altair frames were acquired at a discount of 30% or more, that these frames were more profitable even with the extra dispense fee for the office.
Luxury Fashion Sales Manager / President’s Club President’s Council, Sales Consultant of the Year
8yThank youuuuu Mark, most are not seeing your VSP & non VSP frame comparison reimbursement.... And with their most recent antics to reimburse at 80%, one can only hope that independents start to shift their business to other independent companies that want to support them not compete against them..