In The Press
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Financial Review, 18/11/06 A visionary upstart An entrepreneur has caused a stir in the prescription glasses market and sparked debate about the costs and processes of buying online, writes Damien Lynch. Kevin Reece earlier this year used $30,000 from his personal savings and the sale of a unit to launch GlassesOnline , which sells prescription glasses at a discount over the internet. He's made an immediate impact. The UK-born entrepreneur, who has lived in But GlassesOnline has been met with some scepticism by senior industry figures and dominant rivals. They questioned the service and quality of what was on offer. Sydney-based GlassesOnline offers glasses built from the same frames that retail shops offer with new lenses made to a prescription and backed by a 12-month guarantee at prices ranging from $65. Or customers can buy a complete pair of designer glasses, including the frame, lenses, case and micro-fibre cloth, for $195. Reece, 32, claims retail shops typically mark up the prices of their glasses between five and 10 times the cost, pushing the average price of prescription glasses to more than $300. GlassesOnline , he says, is geared for people who need a new pair of glasses and want to retain the style of the previous pair. The firm has started to cater more for the fashion conscious by offering designer glasses. For fittings, clients simply compare the frame measurements on the website with those written on their glasses. However, Joe Chakman, executive director at the Optometrists Association Australia, warns that buying glasses online won't be successful for everyone. He says frames look quite different in a photo to on the face, and the chance of buying the correct lenses, which involves getting the lens centre to correspond with the centre of the eye, over the internet is "fairly small". And the giant Luxottica Group has refused to supply its popular house brands (such as Ray-Ban) or designer brands (such as Anne Klein, Bulgari and Versace. Chief operating officer Chris Beer said in a statement Luxottica Retail's strategy was based on personal service and value, whereas that of GlassesOnline was based on a low-cost/budget model. "There's room for both, but we believe success in optical retailing rests more heavily on service, quality and brand," he said. The idea for GlassesOnline came from Reece's partner, Donna. She needed new glasses and found that a basic pair was going to cost $300. He was surprised at the price based on the simple premise that glasses are made from bits of metal and plastic, and decided to investigate with the view to creating a business that could sell prescription glasses cheaper. "I found similar businesses overseas and needed to understand whether the same market dynamics existed here," Reece says. "Crucially, whether the difference between the cost of making glasses and the shop price was significant enough to validate the business model. As I intended to reveal the true cost of glasses and cut prices, I didn't expect a warm welcome from the optometrist shops. Some fairly careful digging around revealed the answers." Reece, who was previously an account manager at an IT company, then created a website to make the process of buying glasses online straightforward and transparent. "The optometrist shops have got away with charging high prices because, for most of us, the process of making glasses is a complete mystery," he says. GlassesOnline employs two optical dispensers who are registered with the Optical Dispensers Licensing Board and dispense all glasses. |
