Craft a Warranty Program to Save Profts and Please Patients

Like most practices, you likely have your share of patients seeking free repair or replacement of their eyewear under a warranty. It’s common for opticals to “pass through” a manufacturer’s warranty to patients, citing customer service (plus, it’s just easy). But warranty programs that aren’t strategically created, administered, and monitored will cost your practice time, money, and even its reputation.

A Brief History of Eyeglass Warranties (and Where They Went Wrong)

Lens manufacturers began offering warranties in the early 1980s, when polycarbonate was first introduced as a lens material, recalls Tami Hagemeyer, ABOC, who spoke to optometrists and staff about warranty programs at SECO 2016. Polycarbonate lenses had some problems (like a low Abbe value and propensity to scratch), but they were affordable, and safer than glass or plastic.

Back then, warranties simply allowed ECPs to suggest the new material to patients with little risk, Hagemeyer told conference attendees.

“The lens warranty was never intended to last beyond the release of new lens materials and styles, [and] never designed for prescription mistakes, optician errors, or patient abuse.”

Warranties have evolved into something unrecognizable from their original, humble intent. Patients expect to use lens and frame warranties for any and every reason, even those that are, well, unwarranted. Eager optical staff mistakenly use the manufacturer’s warranty as a sales tool, not realizing that they may be undermining their own efforts.

No Such Thing as a Free Re-do

The number one reason for a remake is the warranty, Hagemeyer points out, citing statistics from The Vision Council. If patients didn’t view their remakes as “free” because of the manufacturer’s warranty, we would be doing a lot fewer remakes, she adds.

“The average lens buying cycle is 1-2 years. Offering a free warranty or disclosing the length of that warranty has extended the buying cycle from 1.9 years to 2.5 years,” she says. There’s also the potential to interrupt the interval between comprehensive exams, which reduces your ability to treat and diagnose health conditions that may be detected during those exams. This delay could eliminate the chance for early treatment of eye diseases that, if left untreated, could have devastating results, she explains.

Neil Gailmard, OD, fellow SECO presenter and editor at Optometric Management agrees. “When patients learn that they can obtain free lenses or a free frame just for the asking, the tendency to use the benefit grows. Some patients will exercise their free warranty coverage not once but several times throughout the year,” he writes in his Tip of the Week column. “Warranties from the lab or manufacturer are extended to your practice, not to the consumer. You don’t have to offer any warranty at all,” he continues.

But wait! Our patients pay a lot of money for eyewear. Isn’t a warranty part of providing great customer service and a reason to buy from us?

Yes—thoughtful warranty programs can be a smart business decision and marketing tool. But offering the manufacturer’s warranty to your customers without analyzing the financial impact on your practice is a mistake. Even when a replacement lens is covered by the lab and ostensibly costs you nothing, your practice is paying a price.

That price may be tough to determine—work you’re not charging for may not appear on financial reports. But think about the staff time involved, both before the remake decision has been made (information gathering, verifying the Rx, re-aligning, re-measuring, and re-marking), and after (shipping costs both ways are typically paid by the practice).

Warranties that Work

Every practice is different; it’s never a matter of one-size-fits-all. If your practice sells a high number of premium frames and lenses, you may be able to afford more generous warranty coverage. If your margins aren’t very high, you’ll have to cut back. Some practices offer a one-time use warranty on their most basic AR coating, while others opt to charge a fee for an extended warranty or collect a “deductible” each time a warranty is used. Even something simple as charging for shipping can offset the cost of remakes over time.

When designing a warranty program that benefits your patients and your practice, keep in mind that the key is to include limitations or parameters that will reduce the number of frivolous remakes. Those can take different forms, but one of my favorites is a tiered program. It gives customers some control over what they’re getting, and letting customers feel like they’re getting what they want is never a bad idea!

Triple Threat

One of my favorite ways to structure a profitable warranty program is to use a tiered approach. Keep in mind that those tiers can take many different forms. Whether you choose “good, better, best,” “silver, gold platinum,” or something else entirely, they each have one thing in common: letting the patient choose what’s right for them while protecting your practice’s bottom line. Here’s one example:

Level 1—Individual ($65): Limited replacement warranty on frame and lenses.

Level 2—Child ($75): Total loss and replacement of one pair of glasses.

Level 3—Family ($150): Limited replacement warranty on frame and lenses for three or more people in the same household.

*All warranties include cleaning cloths, lens cleaner, and nose pad and screw replacement free of charge.

Remember—pricing and plan details will depend on your local market and patient demographics. One practice I worked with (located in the southeast U.S.) established a child’s one-time total loss warranty at $75. Over a one-year period, staff sold 843 warranties. That’s over $63,000 in warranty revenue. How many frames did they replace under the warranty? Only 57. The staff at that practice was highly trained and motivated through sales incentive programs, but with the right design and buy-in, every practice can achieve success.

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