Try Before You Buy?

By By Julie Bos

Few people would buy a new car without doing proper research, checking out reviews and taking the all-important test drive. After all, modern cars aren’t cheap. And when you’re about to plunk down serious money, you want to be sure your decision is sound.

Same holds true for purchasing new optical lab equipment. When the purchase price is in the hundreds of thousands of dollars, you simply can’t afford to make a mistake.

Although there’s no way to actually test drive a new piece of surfacing or edging equipment in your lab—and see exactly how it would work within your four walls—you can get pretty close.  It simply requires some creativity, some communication and some willingness to do some diligent research.

What does it take to succeed?

The Team Approach: Black Lab Optical, Phoenix, Arizona; John McManus, Chief Operating Officer

Lab overview:
Black Lab Optical was established for the independent optometrist by a group of ODs that want an option to compete in a fast-changing industry. The lab is doctor-owned and doctor-driven to deliver superior products and designs that compete with the best in the world.

How do you make purchasing decisions?
As the COO, I typically make the initial pitch about new purchases to the board. Then, we start conversations with the lab manager to determine what’s necessary, what’s warranted and how we want to proceed. Together, the lab manager and I conduct the research, hammer out all of the details and come up with a direction we think is best for the business. After that, we present our recommendation to the board, and make a decision as a team.

Do you typically already know what kind of equipment you want—or even specific solutions? Not always. I usually like to have three options to evaluate. There are so many different types of surfacing, finishing and coating equipment to consider—each with different specifications for power, capabilities, purchase cost, cost of operation, cost of consumables and ongoing requirements for preventive maintenance, which is a major factor in keeping equipment running.

What’s your first exposure to seeing new equipment in person?
Typically, our first opportunity to see new equipment is at a show or conference. It’s there that we can see equipment from multiple vendors at the same location, start conversations, evaluate the equipment and gather all the specs. After that, we really want to speak to someone who already owns that equipment, so we will schedule time to visit one of the lab installations to see the equipment in action and get a perspective from someone with boots on the ground who has been running the equipment for several months. That’s our chance to see the equipment in operation—and more importantly—pick their brain on the equipment’s strengths and weaknesses, and if there are any blind spots to consider.

Do you also solicit input from colleagues and competitive labs? Yes, definitely. When we’re about to make a big investment in equipment, we want to hear perspectives from everyone. That includes established labs with decades of experience, as well as newer startup labs—we glean valuable information from both. Sometimes, a business owner who has been in operation for 30 years may be stuck in his ways and less likely to branch out; whereas a startup lab may be using newer technology that far surpasses traditional systems. It’s always good to get multiple perspectives. In the lab world, we’re all open with each other—I’ve never had an issue with a lab owner not willing to share his or her thoughts. Communication lines are always open.

What’s your purchase criteria? Is it based on volume, purchase price, capacity, speed, type of lenses—or all of the above? It’s all of the above. Obviously, capacity is the first consideration—is this equipment going to give me 40 pairs an hour or 12? So it’s about getting the most bang for the buck. Beyond that, we also look at power consumption, space requirements, and if multiple capabilities are all contained in a single piece of equipment. We have to look at the total package.

How often do you upgrade equipment? Our lab is only four years old, and we have only upgraded our equipment once—about 18 months after we started. We started off with an OptoTech FLASH Store generator, but as our volume of jobs per day increased and we had gained a lot more knowledge and experience, we upgraded to a more automated process with the OptoTech FLASH-A generator. We will be due for another upgrade sometime in 2020.

How do you budget for purchases? First, we determine how much volume we will bring in—how many additional jobs per day we can process—in order to support the monthly payment of the new piece of equipment. You can also consider increases in quality, turnaround time, improved customer satisfaction, and opportunities for additional growth. That’s the goal.

Which should come first—the growth in volume, or the capacity to process that increased volume? We always purchase the capacity first, then fill it. If you do the opposite, your turn times will suffer. Employees would be frustrated because the phones are ringing off the hook, and our customers would be frustrated, which is bad for business. So we track the growth trend carefully over time, so we know when to purchase new equipment. Typically, we accommodate growth in volume by adding a second shift—which gives us a buffer in capacity and the ability to run more jobs per day. As we start to exceed that, that’s when we know it’s time for new equipment.

Identify Bottlenecks: LBC Optics, New Berlin, Wisconsin; Andy George, Owner

Lab overview: Started in the 1988, LBC Optics is a retail lab that directly supports Wisconsin Vision, the largest independently owned optical company in the state, with 40 eye care centers and retail locations under three different names. It started with six employees running about 70 jobs a day, and has since grown to a team of 22 employees doing about 400-600 jobs a day.

How do you make purchasing decisions? It starts by identifying where we have bottlenecks in the lab—where work is piling up. The next consideration is funding—how much money we have to spend. At some point, we have to do something to relieve the bottleneck, regardless of how much money we have, but the amount of money dictates how we may try to solve it. For example, we may not have the money for full automation, but we can achieve partial automation by purchasing an automated instrument and not connecting conveyors right away.

Another important consideration is taxes—specifically, the opportunity for depreciation. When we buy a piece of equipment that costs a million dollars and the government allows us to depreciate 100% of that the first year, that’s like getting a 35% discount on the equipment. So that equipment is actually costing you about $700,000 instead.

What’s your first exposure to seeing new equipment in person?
I always make a point to go to the industry shows and Vision Expos. I go to Las Vegas every year, and New York every other year. The Las Vegas show is a bigger show—it’s a must-attend for most equipment vendors, which makes it a great place to go see what’s new. Attending shows is an important piece of the puzzle—actually seeing the equipment, touching it and talking to someone about it.

Do you solicit advice from colleagues who can tell you all the pros and cons of the equipment? I do that a lot. I call on both colleagues and competitors to learn more about new equipment. I find they are very honest with me. Most are very forthright and will let me know when I need to stay away from something, which is very helpful.

Do you tour customer facilities, too? Yes, I’m a big advocate of that. I probably tour other labs about once a year. I like seeing what other labs are doing—and I often visit the same labs over time to see how they have evolved over time.

Do you rely on invites to vendor-hosted events? Absolutely. I don’t miss those events.

How often do you purchase new equipment?
We purchase new equipment about every two to three years. Most labs (including mine) need to buy new surfacing, finishing and AR periodically—but if you’re only buying one piece of equipment in one of these areas every five years, it would take a total of 15 years to completely refresh the entire line, which is too long. So we’ve decided that every two to three years, there’s something new coming in, whether it’s surfacing, finishing or AR. And in between equipment upgrades, we focus on other efforts to improve efficiency.

What’s your purchase criteria? Is it based on volume, purchase price, capacity, speed, type of lenses—or all of the above? For us, it’s all about getting the most bang for our buck. But beyond that, square footage and equipment space are both big considerations. I think that’s a real problem for most midsize labs like mine, who are doing 400 to 600 jobs a day. There are many pieces of equipment that we simply cannot buy—they’re just too big. In addition, we need to know volume—how many units will we produce per hour—and compatibility—how it will work with the other equipment in our lab.

How do you budget for purchases? We manage our budget carefully and know that every couple of years, we’re going to buy something new. I installed a Schneider CCB automated blocker in April 2019, and I’m already budgeting for a Schneider XTS generator to be installed in December 2020. That means I’m making two large purchases in the space of about 19 months.


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Labtalk-December 2019