This Franchise Winner Has Set Its Sights On $95 Million A Year!
Small Business Opportunities Magazine --September 16, 2008
|Scott Finn, Brian Alessi and Sam Herkoswitz (left to right) are the movers and shakers at Sterling Optical. The company is poised for mega-growth thanks to its offerings of professional eye exams, a great selection of eyewear, impeccable customer service and convenient locations. A lot of smaller optical shops are looking to merge or consolidate with this proven winner.|
When The Wall Street Journal included Sterling Optical in a recent listing of 25 franchise high performers, the news represented validation more than surprise for the retail optical chain that first opened its doors in New York’s financial district in 1914.
Under parent company Emerging Vision, Inc., Sterling Optical is part of one of the largest franchised optical chains in the United States with 157 stores in 15 states. The company also franchises the Site for Sore Eyes brand, whose locations are all in northern California.
In an industry that has been ripe with consolidations and mergers in recent years, Emerging Vision has stood apart from the fray with a singular focus—becoming the industry’s best and most well-respected franchisor—meaning that nearly all of its resources, both human and financial, have been focused on its franchise community and system.
Emerging Vision, which had annual retail systemwide sales of approximately $90 million in 2007, is targeting sales of $95 million in 2008. Sterling Optical, with 157 locations, is the dominant brand of Emerging Vision, a publicly traded company (OTCBB: ISEE.OB).
“The WSJ article aligns with what we have been experiencing over the last couple of years,” said Samuel Herskowitz, president of EVI’s franchise division. “We are going to shine in many places and standing out in our franchise performance is very much in line with that so we’re very excited.”
Trade publication VisionMonday ranked EVI as the country’s ninth-largest U.S. optical chain in its 2007 rankings and EVI executives say it is the largest independent whose primary focus is retail optical services. Indeed, EVI is one of the fastest-growing franchised optical chains in the United States, offering full-service eye care at reasonable prices.
Eleven Sterling Optical centers were franchised and opened in 2007, with approximately 20 centers expected to be franchised and opened in 2008. Six franchises have already been awarded in 2008 including Yonkers, NY (Jan.), Columbia, MD (Feb.), and Abbeville, LA (March), along with Youngsville, LA, Norwood, NJ, and Wellington, FL.
“In what looks like a negative economy and negative marketplace, we are on a pace to perform very well this year,” Herskowitz said.
Franchise growth is generated via three sources: 1) the sale of existing franchised or company-owned locations, 2) the opening of new retail locations and 3) the conversion of existing independent retail operators to an EVI brand. Growth is expected to come from both single- and multi-unit operators. Approximately 50 percent of franchise growth in 2008 is expected to result from conversions, primarily from independent operators or small chains looking to align themselves with an established national brand.
“They are feeling the squeeze more than anybody else,” Herskowitz said. “When they see the big chains and other companies getting bigger and bigger it gets harder for them to compete. The best way for them to compete is to become a competitor and join a chain themselves. Of course, those individuals still want to keep their independence and that’s where a franchise opportunity with Sterling Optical comes in.”
With an unsettled marketplace in the optical industry, Scott Finn, EVI’s vice president of franchise development, says Sterling Optical is perfectly positioned to attract new franchisees. “We are a franchise-friendly organization,” he said. “We are not out to take away our franchisees’ independence. They have the benefit of working with a large franchisor and enjoying all of those benefits but they still are the local owner in their community making their own decisions.”
Drawing new franchisees from within the optical industry has been a focus of Christopher Payan, Emerging Vision’s CEO who took over in 2004. Besides the brand recognition of Sterling Optical that has been established over more than 90 years, franchisees benefit in four other important areas:
Dramatic savings on product inventory through EVI’s significant buying power. “We negotiate substantial discounts with our suppliers,” Finn said. “But at the same time we give our franchisees the freedom and flexibility to choose the product mix that best fits their particular market.”
Proven national and regional cooperative advertising and marketing programs. “Our professional campaigns are backed by market research and proven strategies that are clearly superior to independents, whose efforts are often hit-or-miss,” Herskowitz said. “And whenever we hire an ad agency, we make it clear they are not picking up just one account. They have to be prepared to address the concerns and needs of each of our franchisees.”
The resources of Insight Managed Care, owned and operated by EVI, which develops third-party business for Sterling Optical franchisees by contracting with companies that offer eye care benefits to their covered participants and offering discounted prices to members of the plan. “The job of Insight Managed Care is to help drive business to our franchisees by participation in the maximum number of managed care or vision benefit plans,” Herskowitz said. “It instantly brings that business to them, but more importantly, we show them how to provide outstanding service to those members in a manner that’s also profitable for our franchisees.”
A nationally coordinated training program with a certified in-field training team that provides onsite support to franchisees throughout the year. Several years ago EVI trimmed its corporate staff to focus more resources on providing field service to its franchisees, making regular visits throughout the year to offer advice and feedback on all areas of operations, including training, advertising, marketing and sales, and many other areas. “We thought it was more important to have people inside our stores with franchisees rather than in our corporate office,” Herskowitz said.
With its strong combination of business and financial support services, Sterling Optical serves as an active partner in building successful franchises.
“We are set up so that every department you would find as part of a retail chain—marketing, advertising, merchandising, training and everything else—exists for our franchisees,” Herskowitz said. “Each of those departments is set up like a mini-support center with our franchise support services.”
Independent retailers aren’t the only ones feeling the squeeze from consolidation within the optical industry. The effects are also being felt by frame manufacturers and distributors who are looking to align themselves with an established brand such as Sterling Optical. •
By Harris Publications, Inc.