Is Private Equity another form of Corporate Optometry?

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Is Private Equity another form of Corporate Optometry?

Private Equity has become very popular in our industry. Many older ODs find it have found great benefits with private equity as an exit strategy. Many ODs can sell their practices and not worry about the administrative tasks and still be able to practice the way they want and focus on what they love the most and that is patient care. There are many similarities and differences among practicing optometry in a private equity firm and corporate optometry. Ophthalmology went through it before and maybe the same can be said about labs being bought out over the years. PE is a tough conversation. Some might differ on this comparison, here is what some ODs think about this question.

There are the pros and cons of private equity in optometry

Some Private Equity are investing in new technology in their practices, from EHR to diagnostic equipment. They are building a practice to help with increased costs with low reimbursements. The new investment in technology allows ODs to practice the highest scope allowed. It can be a good employment opportunity for many young ODs that are tied down because of high debt and can still have that private practice feeling with higher than average salaries.

With the pros come the cons. Some of the negatives that ODs expressed were that there would not be any practices for the next generation of ODs to purchase and move the position forward. Some concerns were that these private equity firms would purchase these large practices hold them for a short period of time and sell them to a larger entity in the industry. ODs were concerned that optometry was being lead the way that pharmacy was taken. Being employed might be something that young ODs would like at the beginning of their career, but after a few year many desire to have their own business.

We asked the industry what they thought about if private equity was good for the future of optometry.

Dr Joshua Woodland from Dyerville, Iowa

“History doesn’t repeat, My point isn’t about current status of VCPs but, it’s about allowing something to take hold that allows for short sighted gains but is bad for the profession in the long term.”

Think about how other factors have affect our industry over the years. Use that information to help guide you on new trends and disruptive technology for the future of optometry.

Survey taken in the corporate optometry FB group, many of the members feel that private equity is another form of Corporate Optometry.

From this survey many ODs feel that private equity is another form of Corporate Optometry

It is not Corporate Optometry

Not all corporate opticals are the same, why would private equity firms be the same? There are different models and strategies. Leadership styles can vary in the direction they want to take that company. It is hard to make direct comparisons.

Stan Peacock- Walmart sublease holder in Marianna Florida.

“Not really, it depends on ones definition of what corporate optometry is. And also now there are different types of PE. So different definitions of PE also, especially how the OD is treated-in different PE settings.”

Private Equity is an alternative form of Corporate Optometry.

There can be a blur in being able to differ ante between the two in optometry. When the owner is not an OD sometimes it can be classified as form of corporate optometry. Usually in private equity ODs are employed by the firm. Private equity firms make the decisions on OD schedules, hiring, products for the optical, equipment and other decisions that ODs are not involved with.

John Wiener Costco leasehold in Cincinnati, Ohio

“It is meta corporate optometry. Equity is buying up everything. OMDs included. If you are working under a private equity firm, you are clearly not private. Your livelihood is at the mercy of market forces and corporate decisions that might be far removed from optometry.”

Only time will tell on what specific companies will do and what their strategy is. What is your opinion? Join the conversation on Facebook Corporate Optometry group!

Red Flags in Your Corporate Optometry Employee Contract

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You can always seek the opinion of professionals within the industry. They will tell you what is reasonable to expect and what isn’t.

Another thing to note is that you need to be patient and let your employers bring up the contract themselves. Don’t get ahead of yourself; wait for them to start the conversation.

You need to be honest and straightforward when you’re making an agreement. Remember, there is no reason to be hesitant or embarrassed because it applies directly to you.

Ask questions every step of the way if something is unclear to you. Ask about the frequency of reviews, compensation, bonus and factors that will influence promotion.

Similarly, when you’re becoming a corporate OD, there are some things you need to watch out for things like the number of patients you will see an hour, hours of operation, holidays, weekends, staff support etc.

No Transparency

You need to know that in a corporate setting, it is completely normal to talk about growth opportunities, raises and bonuses, among other things.

If the employers at your workplace of interest are not keen on going into details about their business procedures, chances are that it is not a good sign.

Some element of transparency should be there when you’re negotiating a contract, and withholding of relevant information on any end is a huge red flag.

Ambiguity

If the contract language and the context aren’t completely understandable, you should always ask for clarification. You can easily misinterpret ambiguous statements and the organization can hold you accountable. It is best to avoid signing something you’re not sure about.

Certain language as, “it depends on the store and region”. There are protocols from the corporate level. Make sure all your requests and agreements are in writing. Some other ambiguity could be that anything that you develop during that time that you are an employee is property of the company. As an employee, doing eye exams intellectual property is your own property not the company. If you have this clause it needs to to be removed.

Non disclosure agreements in an employee contract can be a red flag. If you are an employed OD at the store level many times sensitive information is not provided to you. If you are in this position you should not sign an agreement that is not specific to a certain situation or doesn’t have a time frame.

Verbal Agreements and Cues.

Anything that you and your employed have agreed upon needs to be clearly stated in your contract. If you’re denied this, then you should take this seriously because when something isn’t contractually binding, it is easier to get out of. What was verbally agreed upon needs to be in the contract. Many times if a contract is being “sold” as it is a great opportunity that you don’t want to miss because there are other ODs, don’t rush into it. Take your time to review, you don’t want to rush into something that might be hard to reverse.

Long Notice Periods and Restrictive Covenants.

Beware of notice periods that are extraordinarily long. There is something to take notice about any organization that requires you to have a notice period longer than 60 days or if they require to help find a replacement.

Restrictive Covenants are very common in Corporate optometry. A typical covenant is 1-3 miles over a year. Beware of vague covenants without an address to start with and longer than a year. If you are a traveling OD make sure that you are not required to not work 1-3 miles from all the locations because that can limit you to certain locations in your state.

Now that you know some of the warning signs in a contract, you will be able to negotiate in a way that benefits you in the long run. It is necessary to go over the best and worst-case scenarios that can happen during your term of employment and request for amendments accordingly.

When you’re signing a contract, you need to take your time and understand every clause. Consult a lawyer to help guide you. Very contract is negotiable.

Finding the Right Fit in Corporate Optometry.

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Loving your job can make your professional life a whole lot easier. As aspiring optometrists, this should be at the top of your list of priorities.

It may be impossible to secure a job with the perfect paycheck, flexible timings and a work/life balance, but with some research and a can-do attitude, you too can find a job you love.

When you decided to look for a corporate optometry job, you must have realized that there were too many options out there and no way to know which suits you better. The internet can make you more confused with the influx of information on job openings and everyone telling you what to do and what not to do.

The answer lies with you. Be honest about what you need and what you can compromise on. Following are some tips and tricks that can help you land your dream job.

Know Yourself

You may think you want to work at some corporation, but your experience as an employee there could be the opposite. The grass is not always greener on the other side. Taking inspiration from other people’s lives and what works for them will only hold you back.

Self-awareness will take you a long way because knowing your strengths and weaknesses will allow you to make the right decision. If your workplace falls in line with your values, then you may end up having a great time there.

If you’re someone who loves going on vacations, then you should keep an eye out for places that offer great vacation plans. Some corporate opticals offer 4 weeks vacation at sign up.

Learn About the Organization

Before deciding on a place, make sure you know a little bit about the work culture and benefits they offer. Get in touch with alumni who are employed there and get a conversation going.

You can always ask to set up informational interviews to gauge more of an idea about what you’re getting yourself into. Ask on the Facebook group Corporate Optometry.

Stay Open-Minded but Don’t Settle

Keeping your options limited will only lead to misery. Finding a job is not easy. You need to set realistic expectations and take every rejection as a way to learn and improve.

Feeling like a failure after doing badly in one interview will not serve you well. Sometimes what you think you want isn’t necessarily what will make you happy.

Saying yes to the first job you’re offered is not going to help you either, unless it is all that you want. You may be settling for a lot less than you deserve. Depending on the state and the need for ODs many corporate opticals will pay above average salary and sign on bonuses. You can contact Corporate Optometry Consulting to get more info. Their info is corporateoptometry@gmail.com

Now that you know the basics, you can go looking for jobs that are fulfilling for you. Remember that haven’t failed until you stop trying.

Finding your dream job can take months, even years, but you need to realize that sometimes it takes a bad experience to help you find what you are looking for.

Understanding the Different Models of Corporate Optometry

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Whether you’re a recent graduate with big plans or you’ve just left a job to start up your own corporate optometry sublease, it’s important to remember that the industry you’re trying to enter is well-established and competitive. There are some basic concepts you need to clear up before you go about setting up your own optometry practice.

Understanding the Market

Based on where you are in the country, you need to have a strong understanding of the number of optometry patients in the area, the projected number of patients down the line and the modern practices of optometry (including information of technological advancements in the industry). Get information on how many other corporate opticals there are in the area.

Select the Right Business Model

Based on your financial standing, potential employees and expertise, you can choose from a list of different business models:

Franchise

Franchising will help you cross the phase where you’re still trying to establish a brand name. Setting up a well-reputed franchise will help you bring in customers who trust the name. This is useful to have optical merchandising, marketing, frame lines set up for you. Some examples are Pearle Vision, MyEyeLab and Cohens Fashion Optical. Many franchise fees are minimal but include discounts on equipment and frames and the company provides marketing for your location.

Sublease

Subleasing will provide you with the same benefits and disadvantages as those of a franchise. The difference will be the startup cost you’ll need. For a franchise, you need a higher budget. Sublease is turn key with the equipment and office set up. The OD would go in set up their own business adjacent to the optical. Many companies will sublease space in Lenscrafters, Target Optical, LC Macy, Walmart and For Eyes.

Independent Contractor/ Fill in

Independent Contractor is a great way to do part time work or fill in work while you work full time as an employee or sublease owner. Independent contractors enjoy the flexibility to practice what hours they agree upon and able to write off expenses and travel for that day of work. Corporate optometry has many great fill in opportunities and the benefits of fill in are more than just income.

Employed

Employed model in corporate optometry has many benefits that many ODs enjoy. There are no administrative tasks or excessive paperwork. You would simply go in and see your patients and do what you do best and that is being an OD.

Employed ODs enjoy paid time off, a competitive salary, bonuses, benefits package and much more. Many companies will have this option as permitted by state law. Many times ODs will be employed by the sublease owner. Some companies in corporate optometry that employ ODs are Warby Parker, National Vision, Luxottica and Stanton Optical.