Optometrists
Sub-division of the sector
There is a distinction between optometrists and opticians:
• Optometrists are authorised to perform eye tests, prepare glasses and sell all optical products, and to fit contact lenses.
• Opticians are permitted to prepare glasses in accordance with a prepared prescription and to sell sunglasses.
Optometrists and opticians are forbidden from diagnosing diseases and from dispensing medicines.
Market characteristics
Shops with an emphasis on sales and clinics with an emphasis on testing and fitting operate in the market. Products sold at optometrists’ shops include glasses and contact lenses, sunglasses, frames and solutions. The services provided are eye tests, fitting glasses and contact lenses, follow-up care and repairs.
Over the years various chains active in the framework of chain stores and franchise holders have been built. This has made the over-the-counter sale of reading glasses and glasses for mild near or far-sightedness (without astigmatism and/or special angles) and simple sunglasses possible.
Customers
The potential target market is all members of the population with visual problems, regardless of their socio-economic status, gender or other parameter. There is currently one optometrist per every ~2000 households in Israel. However, there are a number of unique groups in the population:
Children up to the age of six and elders above the age of 60 – optometrists are permitted to perform eye tests only on the basis of a referral to/from a physician, the Transport Ministry and for IDF soldiers – for whom glasses are issued at a discount (the payment is made by the IDF, in accordance with a Ministry of Defence tender).
Market segmentation
Segmentation by age, gender and income will affect the quality of the lenses and frames purchased, as will geographical distribution, usage characteristics – medical need, sunglasses and fashion.
Competition
• Private shops – owned by opticians and/or optometrists
• Dedicated marketing chains – these chains are based on aggressive advertising, low prices, a large selection and fast service.
• Points of sale – a franchise for operating a point of sale at large shopping centres based primarily on brands and off-the-shelf products.
• Other – shops and pharmacies offering ready-made reading glasses, without an eye test.
Suppliers
Frames for glasses: frames are generally imported
Optical lenses: there are two factories in Israel (Optiplas and Sagam) that manufacture lenses in accordance with know-how agreements. In addition, there are a number of small manufacturers and imported lenses in varying amounts. Contact lenses: there are three factories in Israel, which also engage in importation and marketing – Soflex, Hanita and Precision. In addition, there is independent importation.
Marketing methods
According to law, optometrists are forbidden from advertising their professional services, apart from shop signage. Nevertheless, there are no restrictions on advertising products. There are a number of marketing methods that are characteristic of the sector: shop window design, displaying a variety of frames around the shop’s walls, distributing cases for glasses, offering eye tests gratis for purchasers of glasses or contact lenses and offering a second pair at a discount (sometimes gratis).
Factors affecting success
Location, reputation, areas of specialization, prices and competitors
Entry barriers in the sector
The professional entry barrier is the training required and a licence from the Health Ministry after passing the professional examinations. The economic barrier is the high investment required for sophisticated optometric equipment, machines for fitting lenses and furnishing and designing the shop and the shop window.
Manpower
Optometrist – mandatory. In most cases he will be the business owner. Optician – a salaried optician can be engaged for preparing the glasses. Some businesses prefer outsourcing such work to an independent optician.
Investment required
The minimal investment for basic equipping may reach NIS 135,000. A typical investment in good quality equipment and modern shop design will cost around NIS 270,000.
Customary profit percentages
Product Profit percentage from sales
Optical lenses 75%
Frames 60%
Frame + lenses 68%
Contact lenses 85%
Solutions 35%
Sunglasses 55%
Customary payment terms
Payment terms for suppliers are generally EOM + 60. Customers generally pay by credit card.
Risk level
The entry threshold is high and the risk stems primarily from the difficulty in realizing equipment and inventory in the event of a cessation of activity or a business failure.
Licences and certification
A professional licence to practice as an optician is required from the Health Ministry, as well as a licence from the Ministry of Labour and Social Affairs. There is no need for a business licence.
Insurance
Business insurance (content and inventory) and third party insurance, professional liability insurance, employer’s liability insurance, and loss of income insurance.
In addition to the aforesaid, consulting with an insurance agent regarding required insurance is advisable.
| Optometrists
There is a distinction between optometrists and opticians:
• Optometrists are authorised to perform eye tests, prepare glasses and sell all optical products, and to fit contact lenses.
• Opticians are permitted to prepare glasses in accordance with a prepared prescription and to sell sunglasses.
Optometrists and opticians are forbidden from diagnosing diseases and from dispensing medicines.
Market characteristics
Shops with an emphasis on sales and clinics with an emphasis on testing and fitting operate in the market. Products sold at optometrists’ shops include glasses and contact lenses, sunglasses, frames and solutions. The services provided are eye tests, fitting glasses and contact lenses, follow-up care and repairs.
Over the years various chains active in the framework of chain stores and franchise holders have been built. This has made the over-the-counter sale of reading glasses and glasses for mild near or far-sightedness (without astigmatism and/or special angles) and simple sunglasses possible.
Customers
The potential target market is all members of the population with visual problems, regardless of their socio-economic status, gender or other parameter. There is currently one optometrist per every ~2000 households in Israel. However, there are a number of unique groups in the population:
Children up to the age of six and elders above the age of 60 – optometrists are permitted to perform eye tests only on the basis of a referral to/from a physician, the Transport Ministry and for IDF soldiers – for whom glasses are issued at a discount (the payment is made by the IDF, in accordance with a Ministry of Defence tender).
Market segmentation
Segmentation by age, gender and income will affect the quality of the lenses and frames purchased, as will geographical distribution, usage characteristics – medical need, sunglasses and fashion.
Competition
• Private shops – owned by opticians and/or optometrists
• Dedicated marketing chains – these chains are based on aggressive advertising, low prices, a large selection and fast service.
• Points of sale – a franchise for operating a point of sale at large shopping centres based primarily on brands and off-the-shelf products.
• Other – shops and pharmacies offering ready-made reading glasses, without an eye test.
Suppliers
Frames for glasses: frames are generally imported
Optical lenses: there are two factories in Israel (Optiplas and Sagam) that manufacture lenses in accordance with know-how agreements. In addition, there are a number of small manufacturers and imported lenses in varying amounts. Contact lenses: there are three factories in Israel, which also engage in importation and marketing – Soflex, Hanita and Precision. In addition, there is independent importation.
Marketing methods
According to law, optometrists are forbidden from advertising their professional services, apart from shop signage. Nevertheless, there are no restrictions on advertising products. There are a number of marketing methods that are characteristic of the sector: shop window design, displaying a variety of frames around the shop’s walls, distributing cases for glasses, offering eye tests gratis for purchasers of glasses or contact lenses and offering a second pair at a discount (sometimes gratis).
Factors affecting success
Location, reputation, areas of specialization, prices and competitors
Entry barriers in the sector
The professional entry barrier is the training required and a licence from the Health Ministry after passing the professional examinations. The economic barrier is the high investment required for sophisticated optometric equipment, machines for fitting lenses and furnishing and designing the shop and the shop window.
Manpower
Optometrist – mandatory. In most cases he will be the business owner. Optician – a salaried optician can be engaged for preparing the glasses. Some businesses prefer outsourcing such work to an independent optician.
Investment required
The minimal investment for basic equipping may reach NIS 135,000. A typical investment in good quality equipment and modern shop design will cost around NIS 270,000.
Customary profit percentages
Product Profit percentage from sales
Optical lenses 75%
Frames 60%
Frame + lenses 68%
Contact lenses 85%
Solutions 35%
Sunglasses 55%
Customary payment terms
Payment terms for suppliers are generally EOM + 60. Customers generally pay by credit card.
Risk level
The entry threshold is high and the risk stems primarily from the difficulty in realizing equipment and inventory in the event of a cessation of activity or a business failure.
Licences and certification
A professional licence to practice as an optician is required from the Health Ministry, as well as a licence from the Ministry of Labour and Social Affairs. There is no need for a business licence.
Insurance
Business insurance (content and inventory) and third party insurance, professional liability insurance, employer’s liability insurance, and loss of income insurance.
In addition to the aforesaid, consulting with an insurance agent regarding required insurance is advisable.
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