Home truths are often painful and when Leightons asked its customers for some honest feedback three years ago the response hurt. The firm acted on that feedback by embarking on a rebranding process which is now nearing completion.
‘It was three years ago that we had a couple of workshops which told us that we looked a little bit like Timpsons,’ says Leighton. That look may work for the shoe repair chain but was not an image Leighton wanted to portray to people in the 30 to 49 age bracket walking past his stores. ‘To hear that from our customers made us rethink the whole brand and the way that the stores looked. That led on to Project Burgundy which has been ongoing.’
Having 34 stores, 23 wholly-owned, means that process of de-Burgundification is expensive and not achieved overnight. ‘There are still stores that are full of Burgundy,’ admits Leighton. ‘We have probably got rid of 75% of it but the ones that are remaining are the expensive ones, the stores that need something structural something more than just a normal shop fit.’
To put some scale on the project, a normal shopfit for the group can cost between £40,000 and £300,000. ‘The £300,000 ones have to be in good sites where there is already profitability or there is a great team and the opportunity for it to grow substantially,’ Leighton quickly adds. ‘If you are investing that kind of money you need to be sure over a period of time you are going to get that back.’ And that has largely been achieved he says. One of the biggest ones was a franchise in Putney which grew its business by 30% in year one and 20% in year two after the refit. Some of the other refits have produced results from as low as 6% growth up to 25%, but so much of this comes back to the strength of the team.
‘Investing in store environment is important but it is not a guarantee of success, and when you do not have the full team in place it can cause a major headache, as we experienced last year when we relocated our Reading store into the city centre,’ says Leighton. It is back to the problem of optom recruitment, he says. ‘It’s a fabulous looking store, where customers often compare it to an Apple store but it’s no good if you don’t have the right people or in this case we struggled to recruit optometrists most likely due to its city centre location. So the business has grown well but we need it to grow significantly more, we have a great team in place in both optical and audiology but still space for a few more optom days. I would hope that over a two-year period from now we will be in a very good place to be able to say that it was a wise investment.’
Attracting the right staff means creating the kind of characteristics for the business and along with the branding and refits comes investment in equipment and training to change attitudes and raise Leightons’ profile.
‘What we are trying to do in our keystone stores is create optical and audiology destinations, centres of excellence that are clinically best in market. Leightons has OCT in all its stores, Optomap in the clinical centres of excellence, along with an audiology suite rather than a shared room. Having a dedicated room says we want audiology to be front and centre alongside optical.’
He says that is mirrored in the product ranges too. ‘It’s trying to take the whole thing up a notch or two to create something of a destination in which people will say “Wow that looks different”. The experience has to be different every time you walk through the door and in the consulting room, if you have got engaged optoms it makes it a bit easier to rely on a consistent level of service.’
Outside of the consulting room Leightons creates a digital dispensing point using Zeiss Eye Terminal. ‘To blend all of that together to create something which is somewhat unique from what is going on in the market at the moment and totally different from the normal high street practice.’
Leighton hopes the actions the group has taken will encourage ambitious optical professionals to take a closer interest in working for and becoming business partners within, the group. ‘We have made an awful lot of progress from three years ago. We didn’t have OCT, we have made a £750,000 investment in that. Shop fits have got to be over £1.5m, investment in people has also been significant. From a training and development point of view I would probably say that is the thing we have done best at as we have set up Leighton’s Learning Academy. We have had government funding for that three years in a row.’ Every £1 Leightons invested in its training academy has been matched by government cash, he adds.
‘Every single person in the business has the opportunity to go through modules that cover everything from communication, sales-through-service, finance, leadership and hearing care and managing performance.’
Although the investment is significant Leighton says the real expense is in staff time. ‘It’s expensive to get all the people up here. We are running these courses four or five times a month, it’s a lot of out of practice time. People might say “That’s insane, you need optoms in your branches today to test”. Our view is a longer term one. You have got to invest in the people to make sure they are advancing as well or otherwise I don’t think, as a business, you will go very far if your people aren’t moving forward with you.’
The product offering has also changed to set Leightons apart from the multiples. ‘We have always had this independent approach of allowing joint venture partners or franchisees to go and do whatever is right in their area.’ That has yielded some really good successes he says such as Pro Design. ‘We are moving up into the Gotti’s and things like that where we are trying to be a bit more niche. Doing better with Lindberg, doing better with Silhouette and bringing in new brands like Walter and Herbert, just trying to be a little bit different from what is going on in the high street.’ As well as hosting the training the head office has benefitted from IT investment and a bolstered head office function to support the practices better and allow them to be more community focused.
Leighton is acutely aware that the online world has changed the way all retail businesses work and says optics will have to change radically over the coming years. ‘I don’t think we are there yet. It’s really difficult to deliver a unique value proposition online, that is not just about low price. So finding the right ecommerce solution, will mean it has to be about choice and convenience. It also has to be about the connectivity to the store and the customer’s prescription, which is an issue because you have to look at your practice management system and you will need to find a way to connect to the ecommerce solution. So offering a seamless and fully integrated ecommerce solution is pretty hard.’
He says the successful solution will need to understand the consumer, have their details, make product suggestions and give them the option of home delivery or store visit for fitting. But, he says, a pure play ecommerce route would be a waste of time for Leightons. It will suit some customers but not all. ‘All of this has huge cost implications, it’s not an easy one. That’s why you are probably looking at the market here in the UK where no one has really cracked it.’ But, he concludes, ‘It’s a question of when, rather than if.’
He suggests some of the bigger players, with deeper pockets may be best placed to have a go. ‘I’m surprised that Vision Express haven’t done it with their scale or Clulow’s.’ Leightons will continue to scan the market for partners who might be able to help find the right ecommerce and multichannel approach.
Technology will bring radical change and optics is ripe for it. The business has not been devastated by the internet but Leighton reckons the sector has five years before radical change comes. ‘With artificial intelligence, augmented reality and 3D printing who knows what that will bring. It’s inevitable that the technology piece is going to radically disrupt and transform this market but how and when I don’t know.’
In the meantime the emphasis remains on staff training. ‘What we are saying to our optometrists is that there is a whole career progression route here at Leightons.’ If you are newly qualified you can be supported with mentors, for those mentors it means they are doing something which is more than testing eyes. Beyond that there are optometrists working in specialist areas of interest such as dry eye, OCT, orthokeratology to help support other professionals in the group.
‘We are now talking much more about the portfolio of services we offer and we realise if you are an optometrist coming in now you don’t necessarily want to just refract for the next 40 years, so let’s find a way to progress your career. We are supporting our optometrists to become Mecs accredited, and should they wish we will look to help them go down the IP route.’
Leightons also wants to appeal to those looking for business ownership. ‘For them it would be a slightly different route,’ he says. ‘They would become part of the leadership team within their store, as all optometrists are invited to do, then they would begin to see and take ownership over the KPIs and more detail around the P&L. There isn’t a formal fast track but we have a group of business owners, half of whom are optometrists, we are able to offer insight and support about owning your own business,’ he says.
Leightons Farnham
But who are these practice owners of the future? All employers want them, do they exist? ‘They are very hard to come by, there is no doubt about that,’ says Leighton. When he talks to people about practice ownership there are fewer options than in the past. ‘I don’t know why that is. I don’t know if it is a sense that the people who are going into optometry are looking for a career with flexibility and freedom. Perhaps it’s a career for five to 10 years, it’s not a job for life, it’s not a place I want to build a business.’ He says Leightons wants to work with ambitious professionals who are in optics for the long term.
‘I don’t think the appetite for business ownership is quite as high as it used to be,’ says Leighton. He cites the economy and cost of starting a business as a factor but also a lack of understanding of the options that might be available. ‘Perhaps they don’t know that actually some of these independent practices are doing incredibly well. They may well have been indoctrinated to think in the way of the multiples and that independents are dying. What they don’t know is that actually there are some amazing independent practices out there that are performing so much better than many of the big national stores in their equivalent town because they have been led to believe that it’s all about these three guys at the top.’
He says there is an education job to be done. ‘We have all got a job to do to explain to the younger optometrists and dispensing opticians out there that there are some very successful independents around the country. If you have got some drive and a bit of entrepreneurial spirit about you this is probably a good time because the opportunity to be truly different against a growing homogenous offering of the high street nationals is great.’
While big changes are inevitable that opens up opportunities as the independents, multiples and the internet vie for position. He says the big shakeout of independents has happened but admits there are more independents to leave the market. ‘It’s about change and accepting that you have to change, for those that don’t it will be an uphill struggle.
‘They have to keep moving forwards, keep evolving and find new ways to grow. There is so much diversification you can do within product and services now that you don’t have to be in the mainstream at all. There so many amazing niche optical brands out there that produce incredible quality product that have a wonderful story.’
Leighton says there are super-successful independents but others are still struggling. They are faced with a range of options including joining with regional clusters such as Leightons, Hakim Group, or Robert Frith or signing up with business support groups. These are all worth exploring, he says.
He senses some consumer fatigue in the multiple model and says Leightons’ strongest new customer growth is in the older, 70-plus, female, age group. He suggests older people are looking to have more care, more time, more service as they age and put a greater emphasis on health.
‘Ultimately for independents to maintain and create their niche it’s by doing things better and better, not being afraid to charge and being seen to be different. It’s about the team, it’s the people, it’s the offering, it’s the store environment, it’s the technology.’
Every practice needs people constantly pushing it forward. ‘Being tapped into the market, having energy and drive, being willing to take a few risks. Just don’t fail too big. I’m convinced independent practice will do well. If your offering is right and you have a clinical offering and you promote it in the right way people are going to find you because thousands and thousands are going to have had the Boots and the Specsavers experience and that cannot always be an exceptional one, purely because of the volume. As those people come to need more care they may look elsewhere. The perception of the customer will be “Can they deliver the same level of care in 20 minutes as someone else delivers in 40 minutes?” That’s customer perception, not that someone else hasn’t done a good job. That is what we are finding at the moment and I suspect that means there is a really good opportunity for us. Winning from the fact that as a volume operator you can’t get it right all of the time.’
Leighton says non-organic growth will be through acquisition to create more keystone centres of excellence and a stronger footprint of best in market practices. ‘We are in discussions with business owners all the time about whether we can work together in terms of finding a suitable succession plan, or even forming a joint venture together. We also have franchise and shared ownership structures available that can work very well for optometrists and DOs who want the support and business method while reducing some of the risk. Our focus is being the best in the areas we operate in. What drives us is being absolutely the best and if we can create more keystone stores, and partner with the right business owners we believe it will also produce more profitability.
‘We are not looking for mega growth,’ he says. ‘Five percent in optical, hearing is on target for 20%. Put this together with some strategic acquisitions and we should bring about a solid performance over the next three years.’
He would give Leightons’ management team a seven out of 10 for success from the activity over the past three years and sees the big change as a cultural one.
‘I think we have done a lot, we have invested an awful lot, we have changed the culture, it’s come forward so much. In management meetings it amazes me how far forward we are there is such a high energy feel.’