Top 50 Retailers Edge Closer To $7 Billion in Sales

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Top 50 Retailers Edge Closer
To $7 Billion in Sales
An exclusive look at how the largest U.S. optical chains performed in 2006
By Cathy Ciccolella
Senior Editor
optical retailers on VM’s latest
list have gained market share
among the Top 50. On this
(in millions)
NEW YORK—Last year, the nation’s largest eyewear/eyecare
year’s list, the Top 10 retailers
retailers and practices moved closer to the $7 billion mark in
have an estimated combined
26.2%
combined optical sales and services, according to VM’s excluvolume of $5,709.5 million,
$6,782.4*
sive 2007 Top 50 Optical Retailers listing, although their share
representing 84.2 percent of
of the overall market slipped slightly.
the Top 50 retailers’ overall
Meanwhile, the industry’s ongoing consolidation has added
sales, up from 82.8 percent of
several significant new players to the Top 50 list.
last year’s VM Top 50 comTotal Market: $25,928**
The combined sales total of the 50 highest-volume optical
bined volume.
Top 10 Share of U.S.
chains in the U.S. is estimated by VM at $6,782.4 million for
The Top 10 optical retailers
Vision Care Market
calendar 2006, giving those 50 chains a 26.2 percent share of
generated 22 percent of the $25.9 billion U.S. market for vision(in millions)
the total $25.9 billion U.S. market for vision-care products and
care products and services sold at optical retail locations last year, a
services sold at optical retail locations last year, as estimated by
slight erosion of market share. In calendar 2005, the VM Top 10
22.0%
$5,709.5*
VisionWatch (see related story below).
accounted for 22.6 percent of that year’s estimated $22.9 billion
The combined sales of this year’s VM Top 50 is nearly $522
total U.S. vision care business at optical retail locations.
million higher than the aggregate volume of the leading 50
Luxottica Retail tops the 2007 VM Top 50 Optical Retailers list
chains in the VM Top 50 listing published in May 2006, which
for the eighth consecutive year. Luxottica Retail’s 2006 U.S. optiTotal Market: $25,928**
showed an estimated $6,260.7 million in combined revenues
cal revenues are estimated at $2,570 million, including sales from
for calendar 2005. (The VM Top 50 Optical Retailers lists * VM Estimate
its 2,424 company-owned U.S. optical stores and the 417 franreporting 2006 and 2005 sales are not directly comparable as a ** Source: VisionWatch
chised Pearle locations.
whole, since the 50 retailers included are not the same from year to year.)
Wal-Mart Stores again holds second place on the VM Top 50 list. The retailing
This latest VM Top 50 list also reflects a higher aggregate store count: an esti- giant increased its eyewear/eyecare sales to an estimated $1,262 million in 2006
mated 9,069 units as of Dec. 31, 2006, up from the estimated 8,804 units pub- through its company-owned Wal-Mart Vision Centers and Sam’s Club locations,
lished on last year’s list for calendar 2005—and breaking the 9,000-unit mark for estimated at 2,755 combined units. Including sales by the approximately 240 Walthe first time.
Mart Vision Centers operated as leased departments by National Vision at yearAlthough the Top 50 retailers of calendar 2006 had a slightly smaller share of the end, VM estimates the aggregate Wal-Mart/Sam’s optical volume for 2006 at $1,410
overall market than in the prior year (in which the Top 50 represented 27.3 percent million.
of calendar 2005’s estimated $22.9 billion U.S. vision-care market), the 10 largest
The optical industry’s ongoing consolidation has produced three new players
among the 20 highest positions on the 2007 VM Top 50 Optical Retailers list. The
August 2006 acquisition of Eye Care Centers of America (ECCA) by Highmark
Vision Holdings’ retail group gives Highmark a strong hold on the number-three
position, with Highmark’s retail revenues including those of the Empire Vision
Centers stores as well.
NEW YORK—Improved technology for measuring vision-care products and servicComing in for the first time at number six is Refac Optical Group, which
es is providing a broadened view of the total eyecare marketplace.
acquired
both U.S. Vision (in sixth place on last year’s list) and OptiCare Health
Using the latest methods of analyzing the complete market, based on an inSystems
(last
year’s number 23) in March 2006.
depth study of consumer buying patterns, VisionWatch estimates the overall vision
Another
new
entry among the VM Top 50 Optical Retailers, at number 16, is
care business at optical locations at $25.9 billion for calendar 2006.
Luxury
Optical
Holdings,
formed last May with the acquisition of Lunettes (numVisionWatch, a joint venture of Jobson Optical Group and the Vision Council of
ber
32
on
the
2006
Top
50)
and several other high-end optical chains including forAmerica, is a continuous consumer study that interviews 100,000 consumers on
mer
VM
Top
50
player
The
Classical Eye.
an annual basis. The information produced by VisionWatch provides not only a
Making
its
last
appearance
on the list as a separate entity is D.O.C Optics, at
broad view of vision-related markets, but also fine details on specific areas of the
number
7.
Most
of
the
D.O.C
stores
were acquired in February 2007 by Luxottica
market.■■
Group, and will appear next year as part of Luxottica Retail. ■■
Top 50 Share of U.S.
Vision Care Market
2007
VisionWatch Analyzes
Total Vision-Care Market
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Rank
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Key Players Ranked By
U.S. Sales in Calendar 2006
Retailer
U.S. Sales
($Millions)
2006
2005
U.S. Units
2006
2005
Comments
1
1
Luxottica Retail
$2,570.0*
$2,410.5*
2,841
2,889
VM’s estimates are for U.S. sales including revenues from 417 franchised Pearle Vision stores. Luxottica Group reported worldwide revenues for Luxottica Retail of approximately $4,654M for FY2006.
Luxottica Retail businesses include LensCrafters (833 U.S. units, 69
units in Canada), Pearle Vision (314 company-owned U.S. units, 38
units in Canada) and Licensed Brands (860 U.S. Sears Opticals, 81
units in Canada; 264 Target Opticals; 153 BJ’s Opticals) plus Shoppers Optical (71 units in Canada), Sunglass Hut International (worldwide), OPSM Group (Australasia) and stores in China and Hong
Kong. Luxottica Retail operates approximately 5,700 optical and sunwear stores worldwide. Acquired D.O.C Optics (100 units) 2/07. U.S.
optical retail trade names: LensCrafters, Pearle Vision, Sears Optical, Target Optical, BJ’s Optical, D.O.C Optics.
2
2
Wal-Mart Stores
$1,262.0*
$1,145.0*
2,755*
2,505*
Worldwide revenues: $1,327M*. Worldwide units: 2,991* (includes
150* Wal-Mart vision centers and 6 Sam’s Club vision centers in
Canada, plus 80* vision centers in Asda stores in U.K.). U.S. estimates include 2,300* company-owned Wal-Mart vision centers and
455* optical departments in Sam’s Club locations.
3
N
Highmark Vision Holding/
Retail Group
$551.9
4
5
Costco Wholesale
$397.0
5
4
National Vision
6
N
7
477
N
$342.6
362
336
Worldwide revenues: $418M*. Worldwide units: 492*.
$368.0*
$355.0*
465*
470
Worldwide revenues: $372M*. Worldwide units: 490* (includes 25*
in Wal-Mart Mexico). U.S. total includes 240* units in Wal-Mart, 33*
in Fred Meyer, 40* in military installations, 12* free-standing Vision
Center II and 140* America’s Best Contacts & Eyeglasses. Optical
retail trade names: The Vision Center (Wal-Mart), The Optical
Shoppe (Fred Meyer), National Vision Optical, Vision Center II,
America’s Best Contacts & Eyeglasses.
Refac Optical Group
$170.0*
N
501
N
Worldwide sales: $178.5*. Worldwide units: 531. Acquired U.S. Vision
(523 units), OptiCare Health Systems (18 units) 3/06. Optical retail
trade names: J.C. Penney Optical, Sears Optical, Macy’s Optical,
Boscov’s Optical, The Bay Optical, OptiCare, others.
7
D.O.C Optics
$115.6
117
118
All but SEE stores acquired by Luxottica Group 2/07 (100 units). Optical
retail trade names: D.O.C Eyeworld, D.O.C Optique, SEE, City Eyes.
8
10
EyeMart Express
$93.0*
$88.5*
72*
9
9
Emerging Vision
$92.0
$89.6
154
155
Optical retail trade names: Sterling Optical, Site for Sore Eyes,
Singer Specs.
10
11
Cohen’s Fashion Optical
$90.0
$80.0*
90
101
Sales include revenues from company-owned and franchised stores.
11
12
For Eyes/Insight Optical Mfg.
$88.0*
$80.0*
140*
140*
Optical retail trade name: For Eyes.
12
13
ShopKo Stores
$78.5*
$76.5*
131
134
Optical retail trade names: ShopKo Eyecare Center, ShopKo
Express Eyecare Center.
13
15
Texas State Optical
$66.8
$62.0
100
100*
All locations independent franchises.
14
14
Eyeglass World/Vision Care Hldgs. $64.0*
$62.4*
60
60*
Optical retail trade name: Eyeglass World.
15
16
Eyecare Center
$58.6
52
51
Formerly Optometric Eye Care Centers.
$62.0
N
$106.8
67*
Acquired Eye Care Centers of America (385 units) 8/06. Optical retail
trade names: Empire Vision Centers, Davis Vision Centers, Total
Vision Care, Cambridge Eye Doctors, Vision World (R.I.), EyeMasters, Visionworks, Vison World, Hour Eyes, Dr. Bizer’s Vision World,
Dr. Bizer’s Value Vision, Doctor’s ValuVision, Doctor’s Visionworks,
Stein Optical, Eye DrX, Binyon’s.
Optical retail trade names: EyeMart Express, Vision 4 Less, Visionmart Express.
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Rank
2006 2005
U.S. Sales
($Millions)
U.S. Units
Retailer
2006
2005
2006
2005
Comments
16
N
Luxury Optical Holdings
$60.0*
N
40
N
Formed by acquiring Lunettes (12 units), Morgenthal-Frederics (7
units), Optical Fashion Centers (7 units) 5/06. Acquired Optica (5 units),
Optical Elements (4 units) 8/06; acquired Classical Eye (3 units) 11/06.
17
17
Doctors Vision Center
$56.0
$54.9
63
68
Optical retail trade names: Doctors Vision Center, Tennessee Vision
Associates.
18
19
Nationwide Vision
$44.2
$41.0
56
54
Optical retail trade names: Nationwide Vision, Nationwide Optique,
Nationwide Laser & Eye.
19
18
Henry Ford Optimeyes
$43.8
$41.0
18
27
Optical retail trade name: Henry Ford Optimeyes.
20
21
Optical Shop of Aspen/Oakley
$30.0
$32.0
20
15
Acquired by Oakley 4/06 (17 units). Optical retail trade names: Optical Shop of Aspen, OSA International, Emporio Optic.
21
N
SVS Vision
$28.5*
N
52
N
22
24
Eye Centers of Florida
$28.0*
$27.0*
15
15*
23
25
Clarkson Eyecare
$27.9
$24.6
27
24
24
22
Eyear Optical
$26.0*
$31.8*
25*
30*
25
20
United Optical/Spectera
$25.4
$34.4
54
55
26
27
General Vision Services
$25.0*
$23.0*
24
24
27
26
Rx Optical Laboratories
$24.0*
$23.5*
42
42
28
29
Crown Optical
$21.4
$19.5
26
26
29
30
Wisconsin Vision
$20.0
$19.0
26
25
Optical retail trade names: Wisconsin Vision, Heartland Vision.
30
34
Allegany Optical
$18.5
$15.5*
22
22
Optical retail trade names: Allegany Optical, Allegany Optometry,
National Optometry.
31
28
Eye Health Vision Centers
$18.3
$20.6
5
4
32
33
Co/op Optical Vision Designs
$17.7
$17.2
11
11
Optical retail trade names: Co/op Optical, Vision Designs by Co/op
Optical, Co/op Optical Vision Designs.
33
31
Dr. Tavel Optical Group
$17.5*
$18.0*
22
24
Optical retail trade names: Dr. Tavel Family Eyecare, Dr. Tavel OneHour Optical, Premium Optical, Vision Values.
34
37
Eye Care Associates
$16.5
$14.8
12
12
35
36
Horizon Eye Care
$16.4
$14.8
6
5
36
35
Palmetto Optical
$15.0*
$15.0*
19*
19*
Optical retail trade names: Jackson-Davenport, Palmetto Optical, others.
37
39
The Hour Glass
$12.8
$12.6
9
9
Optical retail trade names: The Hour Glass, Eye Savers, South East
Eye Specialist.
38
38
The See Center/Group Health
$12.8*
$13.0*
15
16
39
41
Accurate Optical
$12.4
$11.7
12
12
Optical retail trade names: Accurate Optical, H. Rubin Vision Centers.
40
40
Standard Optical
$11.1
$11.8
17
17
Optical retail trade names: Standard Optical, Rocky Mountain Eyeworks.
41
42
The Eye Gallery
$11.0
$10.0*
10
9
42
43
Rosin Eyecare
$10.0*
$9.7*
12
12*
43
44
Optical Management Systems
$8.8
$8.9
10
10
44
48
St. Charles Vision
$8.5
$7.3
8
7
45
46
Bard Optical/ J.A.K Enterprises
$8.5
$7.7
18
18
46
45
Thoma & Sutton Eye Care
Professionals
$8.5
$8.2
21
21
47
47
Europtics
$7.6
$7.3
4
4
48
N
Midwest Vision
$7.4
N
17
N
49
50
Voorthius Opticians
$7.1
$6.3
8
8
50
49
Fraser Optical
$7.0*
$7.0*
6
6
$6,782.4*
$5,566.4*
Totals
Acquired by company management team 3/07.
Acquired Maplewood Eyecare (1 unit) 7/06
Optical retail trade name: United Optical.
Optical retail trade name: Rx Optical.
Acquired Iredell Eye South (1 unit) 11/06.
Optical retail trade names: Riverfront Optical, Optiview Vision Centers.
Optical retail trade name: Bard Optical.
9,069* 7,777*
Source: VM’s 2007 Top 50 U.S. Optical Retailers
When 2006 U.S. sales are the same for more than one company, the retailer with the fewest 2006 U.S. units is ranked first.
*=VM estimate. N=Not on last year’s list. Note: U.S. sales include Puerto Rico.
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2007
What 2006’s largest retailers player’s plan for 2007
Top 10 Share of the VM Top 50
(in millions)
dising message skews more strongly toward
eyecare and lens technology.
2
Wal-Mart
Top 10: 84.2%
$5,709.5*
Top 50: $6,782.4*
* VM Estimate
1
Luxottica Retail
U.S. Optical Sales: $2,570M (est.)
U.S. Optical Units: 2,841
Trade names: LensCrafters, Pearle Vision,
Sears Optical, Target Optical, BJ’s Optical,
D.O.C Optics
Luxottica Group’s Luxottica Retail division now operates approximately 5,700
optical and sunwear stores worldwide;
slightly more than half of those are optical retail locations in the U.S. (the U.S.
total includes 417 franchised Pearle
Vision stores). Those U.S. optical locations generated estimated revenues of
$2,570 million in calendar 2006, up from
$2,410.5 million estimated for 2005.
This year, Luxottica’s management
continues an intensive retail expansion,
which kicked off in February with the
acquisition of D.O.C Optics. Luxottica
chief executive officer Andrea Guerra has
said the company expects to add about
500 new retail locations worldwide during
2007; in the first quarter alone the company opened 149 new stores internationally
in addition to the D.O.C acquisition.
Luxottica Retail is also working to
update several of its U.S. optical chains.
Last year, 51 of its flagship LensCrafters
stores were remodeled using a new
store format; another 130 will carry the
new look by the end of 2007. Luxottica
also continues to test its LensCrafters
Optique store concept, offering smaller
locations with partial or no in-store labs.
More than 100 company-owned Pearle
stores installed digital retinal imaging
equipment in 2007’s first quarter, under a
plan to put the machines in 225 Pearle locations by year-end. Luxottica is supporting
those stores with new ads highlighting digital retinal imaging, as the Pearle merchan-
U.S. Optical Sales: $1,262M (est.)
U.S. Optical Units: 2,755 (est.)
Trade Names: Wal-Mart Vision Center,
Sam’s Vision Center
Retailing giant Wal-Mart Stores opened
an estimated 250 more U.S. vision centers
last year, ending 2006 with an estimated
2,300 company-owned optical departments in its Wal-Mart SuperCenters and
discount stores, plus about 455 vision centers in its Sam’s Club warehouse clubs, for
a total of 2,755 company-owned optical
locations. Wal-Mart’s optical revenues
reached an estimated $1,262 million last
year, up from 2005’s estimated $1,145-million volume—and enough to comfortably
retain its second-place position on the VM
Top 50 Optical Retailers list.
Under its optical division’s senior vice
president, Jeff McAllister, Wal-Mart is
expected to maintain its rapid pace of
store expansion during 2007, on track
with its reported strategy of adding 250
to 300 new company-owned optical
departments annually for the next few
years. Overall, Wal-Mart has announced
plans to open from 305 to 330 new U.S.
discount stores and SuperCenters this
year, about half of them relocated or
expanded existing stores, and from 20 to
30 more Sam’s Clubs in the U.S.
The company is also expected to add
stores in Canada, including a possible
expansion of Sam’s Club there; Wal-Mart
opened its first six Sam’s locations in
Ontario (each with optical) late in 2005.
3
Highmark Vision
Holding/Retail Group
U.S. Optical Sales: $551.9M
U.S. Optical Units: 477
Trade Names: Empire Vision Centers,
Davis Vision Centers, Total Vision Care,
Cambridge Eye Doctors, Vision World, EyeMasters, Visionworks, Hour Eyes, Dr.
Bizer’s Vision World, Dr. Bizer’s Value
Vision, Doctor’s ValuVision, Doctor’s Visionworks, Stein Optical, Eye DrX, Binyon’s.
A new entry among the Top 10 this
year, Highmark Vision Holding’s retail
group takes over the third-place spot
held previously by Eye Care Centers of
America (ECCA), which Highmark
acquired in August 2006. Combined
with $114.2 million in sales volume
from its Empire Vision chain (number 8
on last year’s VM Top 50 list), ECCA’s
$437.7 million revenues gave Highmark
Vision Holding—led by chief executive
officer and president Bob Gray—total
retail revenues of $551.9 million in calendar 2006, generated by 477 optical
locations.
The Highmark acquisition—a $317.2
million deal—came after ECCA’s previous majority owner, Moulin Global Eyecare, foundered financially and was
taken over in June 2006 by a courtappointed liquidator. That liquidator
and equity investor Golden Gate Capital sold the chain to Highmark.
Since the acquisition, ECCA chairman/president Dave McComas and his
team are accelerating the chain’s expansion. ECCA plans to open 25 new locations annually during 2007 and 2008,
concentrating on the Chicago area.
ECCA entered the Chicago market
with its first Visionworks store there in
February 2007.
Syracuse, N.Y.-based Empire Vision
Centers, which has been owned by
Highmark subsidiary Davis Vision since
1995, currently operates 90 retail locations; Empire added two stores in 2006.
4
Costco Wholesale
U.S. Optical Sales: $397M
U.S. Optical Units: 362
Trade name: Costco Optical
Costco Wholesale continued to boost its
presence in optical during 2006. The
chain added 26 more in-store, everydaylow-price Costco Optical vision centers
last year, bringing its U.S. total to 362.
Those new company-owned optical
departments helped the membershipwarehouse chain move up from fifth
place to the number 4 spot on the VM
Top 50 Optical Retailers list, with optical revenues of $397 million—representing two million pairs of eyeglasses
sold—in calendar 2006.
Costco also continues to strengthen
its position in the worldwide optical
market, operating an estimated 130
optical departments in its stores outside
the U.S. at the end of 2006, primarily in
its warehouse clubs in Canada, Mexico
and the U.K.
Costco’s total worldwide store count
reached 504 by the end of 2006; the chain
added six more locations by mid-April
2007. Costco officials have said the company will open 32 to 35 warehouse clubs
during its 2007 fiscal year, which closes in
early September. Another 35 to 40 new
locations are projection for FY 2008.
With 49 million club members, Costco remains a force to be reckoned with
in optical retailing.
5
National Vision
U.S. Optical Sales: $368M (est.)
U.S. Optical Units: 465 (est.)
Trade Names: The Vision Center (WalMart), The Optical Shoppe (Fred Meyer),
National Vision Optical, Vision Center II,
America’s Best Contacts & Eyeglasses
A privately held company since its
takeover by equity investor Berkshire
Partners in August 2005, National Vision
is focusing on expanding the America’s
Best Contacts & Eyeglasses chain,
which it acquired in an $88 million deal
around the same time.
The CVG acquisition has been a
major move in National Vision president
and chief executive officer Reade Fahs’
strategy to find additional revenue
sources as the oldest leases on the company’s Wal-Mart vision centers expire.
In 2006, National Vision closed about
35 Wal-Mart locations, primarily because
of lease expirations. In 2007, another 40
Wal-Mart leases are due to expire.
National Vision’s loss of revenue from
its dwindling presence in Wal-Mart is
counterbalanced by healthy growth of
its everyday-low-price, high-volume
America’s Best stores. During 2006
National Vision opened about 30 more
America’s Best units; the chain is
expected to add at least 40 additional
locations this year, and up to 50 or 60
annually beginning in 2008.
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Continued from page 52
National Vision also sees growth
opportunities through its vision centers
on U.S. military bases. The company
had about 40 military locations at the
end of 2006, up by about 10 from the
prior year. It also operates leased vision
centers in about 33 Fred Meyer discount stores, as well as about a dozen
free-standing Vision Center II stores.
6
Refac Optical Group
U.S. Optical Sales: $170M (est.)
U.S. Optical Units: 501
Trade Names: J.C. Penney Optical, Sears
Optical, Macy’s Optical, Boscov’s Optical,
The Bay Optical, OptiCare, others.
Refac Optical Group became an instant
player in the U.S. optical marketplace
with its March 2006 acquisitions of both
U.S. Vision and OptiCare Health Systems. With 501 U.S. optical locations—
most of them leased vision centers hosted by various department-store
chains—and estimated revenues of $170
million for calendar 2006, Refac comes
onto the VM Top 50 Optical Retailers list
at number 6, the position held by U.S.
Vision last year. Though a public company when it made those acquisitions,
majority owner Palisade Capital Management took Refac private last month.
Now with the freedom to make longterm decisions without the pressure of
daily public fluctuations in its stock
price, Refac—under president and chief
executive officer Dave Pierson—is
expected to accelerate its retail expansion. Its largest host, J.C. Penney, plans
to open about 50 stores annually for the
next few years, many in an off-mall format and each with the potential of
incorporating a Refac-operated vision
center; U.S. Vision will open its first
optical departments inside Penney’s offmall stores this fall. Refac is also likely
to expand its presence in Macy’s stores,
where it currently operates about 30
leased opticals.
Refac ended last year with 349 vision
centers operated by U.S. Vision in J.C.
Penney locations. plus leased departments
in Sears (62), Macy’s (25) and Boscov’s
(28), as well as in The Bay in Canada (30).
7
D.O.C Optics
U.S. Optical Sales: $115.6M
U.S. Optical Units: 117
Trade names: D.O.C Eyeworld, D.O.C
Optique, SEE, City Eyes
D.O.C Optics operated 117 stores during 2006, including 11 franchised locations. Its sales reached $115.4 million for
the year, retaining the chain’s position in
seventh place among the VM Top 50
Optical Retailers.
Although D.O.C had operated as a
family-run company since its founding
by Donald Golden, OD, in 1946, last
year president and chief executive
officer Richard Golden (the founder’s
son) and the rest of the chain’s ownership decided to sell D.O.C, to Luxottica Group. That $110 million sale,
finalized in February 2007, included
all of D.O.C’s stores except the 19unit SEE chain Richard Golden
launched in 1998.
Golden said during D.O.C’s last
“Expo” meeting in December that selling the stores represented “a bittersweet
time for our family.” He added, “We
never had a ‘for sale’ sign out,” noting
that he was contacted by Luxottica
Group about a possible acquisition of
the fashion-oriented chain in 2005.
Luxottica executives have said their
newly acquired D.O.C Optics stores will be
converted half to Luxottica Retail’s Pearle
Vision format and half to LensCrafters.
Meanwhile, Richard Golden has
pledged to continue to build his trendy,
all-private-label SEE chain.
8
Eyemart Express
U.S. Optical Sales: $93M (est.)
U.S. Optical Units: 72 (est.)
Trade Names: Eyemart Express, Vision 4
Less, Visionmart Express, Eyewear Express
Established as a discount retailer in 1990,
Eyemart Express has grown to a chain of
more than 70 locations, primarily in the
Midwest and South; all its stores have
on-site optical labs. In calendar 2006 the
discount optical retailer’s estimated annual revenues climbed to $93 million—
moving it up two places on VM’s annual
Top U.S. Optical Retailers listing.
Headed by founder Doug Barnes,
OD—who had previously launched the
Vision Express chain in 1980, then sold it
to Pearle Vision a few years later—17year-old Eyemart Express continues to
stress its “everyday low price” philosophy, pledging in its marketing to beat any
other retailers’ pricing on brand-name
frames or the frames are free. The chain
regularly advertises eyeglass deals such as
one pair single-vision glasses for $38.74,
two pair for $67.92 and one pair of glasses
with progressive lenses for $88.74.
9
Emerging Vision
U.S. Optical Sales: $92M
U.S. Optical Units: 154
Trade Names: Sterling Vision, Site For
Sore Eyes, Singer Specs
With 10 company-owned stores and 144
franchised locations in 23 states as of the
end of 2006, Emerging Vision—parent of
the 93-year-old Sterling Optical chain—
retains its ninth-place spot on the VM Top
50 Optical Retailers list this year, with retail
revenues in calendar 2006 of $92 million.
Emerging Vision got an overall revenue boost in August 2006 through its
$2.4 million acquisition of the 909-member, Florida-based Combine Optical
Management buying group; Combine
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generated one-third of its new owner’s
total revenues during the last five
months of 2006. Emerging Vision also
operates VisionCare of California, a statelicensed health-care maintenance organization there; in other states, the company uses its Insight Managed Vision Care
operation, which offers managed-vision
plans, to help funnel customers into its
Sterling Optical stores.
Under chief executive officer Christopher Payan—who took over in June
2004—and his management team,
Emerging Vision began modifying the
product mix in its Sterling Optical stores
during 2006, then launched a new
advertising campaign to support the
revamped product mix.
10
Cohen’s Fashion Optical
U.S. Optical Sales: $90M
U.S. Optical Units: 90
Trade Name: Cohen’s Fashion Optical
Cohen’s Fashion Optical, a fixture in optical retailing in the New York metropolitan
area for more than 80 years, moves back
into the Top 10 this year, based on retail
sales of $90 million during calendar 2006.
Last year, the chain was number 11 on
the VM Top 50 Optical Retailers listing.
With its 90 locations—a mixture of
company-owned and franchised locations—concentrated in the Northeast,
Cohen’s sales last year were boosted by a
$3 million advertising campaign that
kicked off in May 2006, stressing the
chain’s fashion eyewear selection. The
chain remains a bastion of everyday-lowprice marketing as well, regularly advertising eye exams for $20 or $29 (depending
on geographic area), along with $99 complete eyeglass pairs or free second pairs.
Privately held Cohen’s Fashion Optical
is owned and operated by industry veterans—and brothers—Robert Cohen, OD,
and Alan Cohen, OD. ■■
VM Top 50 U.S. Optical Retailers Methodology
The VM Top 50 U.S. Optical Retailers report ranks the 50 leading companies in optical
retailing, based on their revenues during calendar 2006.
The VM Top 50 report is based on a survey of all major U.S. optical retailers, including
information reported directly by chains and independent retailers and practitioners, interviews with company executives, published corporate documents, and knowledgeable secondary sources. A detailed questionnaire was sent to more than 150 leading U.S. optical
retailers to obtain this information; in addition, those retailers were contacted by telephone to follow up on the questionnaire.
In cases where corporate policy prevented companies from reporting retail volume
or other information, various methods were used to reach accurate estimates for
those retailers. The history of each chain was carefully analyzed, and the most knowledgeable and relevant secondary sources consulted. Averages pertinent to the geographic and market situations of each retailer were also developed in producing these
estimates.
U.S. sales figures for The VM Top 50 include revenues from both company-owned and
franchised stores (if applicable), managed-vision-care revenues, and shares of doctors’ or
laser-surgery fees. In short, U.S. sales represent all money a company derives from optical products and services in the U.S. and Puerto Rico (however, it does not include revenues from locations operated solely as laser centers). It is also important to keep in
mind that sales volumes given on The VM Top 50 list reflect annual net sales, which
may differ widely from retailers’ comparable-store sales for the same year.
If two companies have reported or been estimated the same sales for the year, the
one with the smaller number of locations is ranked higher, reflecting its higher sales
per unit.
In cases where one retailer acquired another during 2006, the acquired retailer’s sales
prior to the acquisition are combined with those of the acquiring company to produce
the full year’s results for the acquiring company.
—Cathy Ciccolella, Senior Editor
—Jennifer Zupnick, Marketing Research Analyst
—Beth Briggs, Junior Research Analyst
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Mass Merchants, Clubs See Sales Gains
Through In-Store Optical Departments
NEW YORK—Last year, the seven
largest U.S. mass merchants and warehouse clubs with in-store optical departments again strengthened their presence in the U.S. optical market,
according to VM’s exclusive annual survey of mass merchants and warehouse
clubs in the optical business.
During calendar 2006, these national
and regional retail players increased
their U.S. optical revenues by an estimated combined total of slightly over
$151 million. Their overall unit count
grew as well last year, despite a reduction in leased-optical-departments
inside Wal-Mart and Fred Meyer stores
by National Vision and, to a much lesser extent, a slight drop in ShopKo’s
company-owned Eyecare Center total
store count.
Overall, this group of mass merchants
and warehouse clubs generated combined optical revenues that totaled an
estimated $1,981 million for calendar
2006, up about 8 percent over their estimated $1,829,8 million in optical sales
and services in 2005. That 2006 volume
took these giant retailers’ share of the
total VM Top 50 U.S. Optical Retailers’
combined sales volume to 29.2 percent,
just a hair above the prior year.
During 2006, these powerful retail
players together added an estimated
252 more optical locations—a slightly
smaller unit increase than in 2005—taking their aggregate year-end count near
the 4,000-unit mark, with a combined
estimated total of 3,938 in-store vision
centers.
Wal-Mart again showed the largest
increase in vision centers, adding roughly 225 company-owned optical locations
in its discount stores and SuperCenters
last year. (National Vision, which operates leased optical departments inside
Wal-Mart stores, closed an estimated 35
of those locations during 2006 because
of lease expirations, however, so the
total estimated Wal-Mart vision center
count rose by only 190 locations.)
Wal-Mart also is estimated to have
added optical centers to an additional 25
new and existing Sam’s Club warehouse
clubs during 2006, bringing the Sam’s
Club total to roughly 455 optical locations.
With between 305 and 330 new WalMart discount stores and SuperCenters
planned to open during 2007, Wal-Mart
is again expected to boost its vision center count this year by putting optical
departments into many of those new
locations; it will also have the option of
taking over as many as 40 additional
licensed departments currently operat- to add about 10 new warehouse clubs,
ed by National Vision as their leases most with optical, by the end of its 2007
expire if those leases are not renewed fiscal year, which closes early in September. And ShopKo Stores, coming off
by conversions to SuperCenters.
Another 20 to 30 new Sam’s Clubs— a record year for optical sales in 2006,
about half of them relocations of exist- breaks ground May 30 for the first new
ing warehouse clubs—
are also on the drawing
This group of mass merchants
board for this year, which
should strengthen Sam’s
and warehouse clubs generated
position in the optical
combined optical revenues that
marketplace.
The big will keep gettotaled an estimated $1,981
ter bigger among most of
the other mass mermillion for calendar 2006.
chant/warehouse club
players as well. Luxottica Retail should ShopKo discount store that chain has
pick up some additional space for its built in six years. With backing from
licensed Target Optical and BJ’s Optical Sun Capital Partners, which made a
departments as those two chains add majority investment in ShopKo in
more locations this year: Target has December 2005 and then took the
already opened four more stores with chain private, ShopKo has said this new
optical department during 2007, with location with optical is slated to open—
more to come; BJ’s is committed to open- using a revamped store prototype that
will be used for its new units going foring 8 to 10 new clubs this year as well.
During 2006, Luxottica Retail added ward—in spring 2008 in Suamico, Wis.,
10 new BJ’s Optical locations and near its Green Bay headquarters.
“We believe this signifies that Shopopened vision centers in an additional
Ko is ready to begin its next growth
18 SuperTarget discount stores.
With vision centers in 362 of its 371 phase,” declared Mike McDonald, the
U.S. warehouse clubs as of the end of discounter’s chairman and chief execu—Cathy Ciccolella
calendar 2006, Costco Wholesale plans tive officer.
Leading Mass Merchants With Optical Departments
Rank
06 05
1
1
Mass Merchant
(Operator)
Wal-Mar t
Wal-Mart Corp.
National Vision
Class
(Operator)
MM
Wal-Mar t
Wal-Mart Corp.
National Vision
2
2
Costco Wholesale
397*
362
WC
Costco Wholesale
3
3
Sam’s Club
Wal-Mart Corp.
116*
455*
WC
4
4
ShopKo Stores
*13 78.5*
131
5
5
Target/Super Target
Luxottica Retail
50*
6
6
BJ’s Wholesale
Luxottica Retail
7
7
Fred Meyer
National Vision
Totals
2006 Retail Sales
($ in millions)
1,294*
1,146*
148*
2006
Units
2,540*
2,300*
240*
2005 Retail Sales
($ in millions)
1,205*
1,035*
170**
2005
Units
2,350*
2,075*
275*
342.6
336*
Sam’s Club
Wal-Mart Corp.
110*
430*
MM
ShopKo Stores
76.5*
134
264
MM
Target/Super Target
Luxottica Retail
48*
246
35.5*
153
WC
BJ’s Wholesale
Luxottica Retail
33.5*
143
10*
33*
MM
Fred Meyer
National Vision
14*
47
$1,981*
3,938*
$1,829.6*
3,686*
Source: The VM Top 50 U.S. Optical Retailers Report 2007
* = VM estimate. MM = Mass Merchant. WC = Warehouse Club