With multiple vaccines already being deployed throughout the U.S. and in other countries, the prospects for retail franchise businesses in 2021 is more optimistic than just 6 months ago.
According to research from McKinsey & Co., roughly 40 percent of American consumers reduced overall spending. With the state of the economy in flux, shoppers have understandably pulled back on nonessential products. However, retailers that provide essential products and services continue to see strong consumer demand. In short, it’s been back to basics and value for most consumers.
Still, there are numerous questions about what the year will hold for retail franchises. In many cases, the answers are found in the strong operational fundamentals and business practices that separate leaders from laggards – pandemic or no pandemic. These include:
- Providing an exceptionally convenient experience
- Prioritizing the health and safety of customers and employees
- Reinforcing supply chains to avoid disruption
- Minimizing capital investments
While many retail franchises have spent the past year making adjustments to how they operate while continuing to serve the public, others like My Eyelab have had to make fewer adjustments by virtue of their existing business models – putting these brands in a position of strength heading into the new year.
Here’s a closer look at how retail franchises like My Eylab have developed robust operational standards that position themselves as growth leaders in the new year.
Exceptionally Convenient Experiences
Regardless of the state of the economy, consumers expect convenience. Retailers’ ability to maximize their digital technologies was one of the biggest stories coming out of 2020. Looking ahead, there’s little doubt that the trend toward increased use of digital tech is going to be a permanent fixture in the modern commercial landscape. Leading retail franchises have been able to develop an omni-channel model that allows seamless interactions whether their customers are visiting their websites or physical storefronts.
For a retail franchise like My Eyelab, the shift toward digital technology – while maintaining exceptional in-store experiences – has played to our business model’s strengths. Our brand developed a proprietary telehealth model that allows customers to get a routine eye exam in as little as 10 minutes through any of our fully licensed doctors within our virtual network. We have also developed a robust online presence that enables customers to shop for the latest styles, check their order status, find their nearest location and book an appointment that fits their schedule – including same day, if needed. As a result, franchise owners are able to deliver convenience, value and essential products and services all at once.
Prioritizing Health and Safety
One of the trends that retailers have had to confront since the beginning of 2020 is the need to ensure their customers’ and employees’ health and safety. According to a Deloitte survey from before Thanksgiving 2020, 56 percent of consumers were anxious about shopping in stores. By investing in health and safety standards, retail franchises are able to re-establish trust with their customers, which helps build increased loyalty and referrals.
This adjustment in integrating health and safety guidelines on federal, state and municipal levels has been one of the biggest challenges for many retailers – particularly those that depend on high customer volumes. My Eyelab is in a fortunate position to have a business model that facilitates social distancing. Because of our telehealth technology, customers aren’t required to sit in close quarters with an optometrist or ophthalmologist for extended periods of time. Additionally, My Eyelab franchises require just 4-6 employees for day-to-day operations. This allows franchisees to conform to social distancing protocols while still ensuring they’re able to keep customer traffic at a level that supports profitability.
Reinforcing Supply Chains
Many retailers felt the sting of supply chain disruption last year, especially as consumers sought to stock up on essential items. They quickly found their supply chains were less resilient than they realized and shelves remained empty for extended periods of time. In 2021, a growing number of brands have made supply chain management and efficiency a top priority.
My Eyelab franchisees have been somewhat insulated from supply chain issues because of our centralized system for processing orders for eyewear. As a brand, we’ve developed long-standing relationships with our vendors, enabling us to supply between 1,500 and 3,000 frames to each location. Upwards of 90 percent of these frames are private label and exclusive to My Eyelab. This helps franchisees keep their operating costs down, savings which are passed on to customers – and it helps establish a strong supply chain that ensures franchisees have fully stocked showrooms.
Minimizing Capital Investments
One of the most important learnings coming out of 2020 among retail franchises was the need to be efficient with their store footprint. While overall foot traffic to physical retail locations is expected to increase as vaccinations become more widespread, it’s going to take time. Retailers that depend on high in-store volumes to reinforce their cash flow may continue to experience challenges compared to previous years. Some have turned to converting their locations into fulfillment centers for ecommerce orders. However, smaller retailers that have taken this route and made the pivot to online shopping are going to face a tough road ahead to stay competitive with the online ecommerce giants like Amazon in the long term.
Retailers that developed a business model built on a small overall retail footprint have an advantage heading into 2021. Specifically for My Eyelab, our investments in telehealth technology and a centralized lab helps to keep capital investments down, especially when compared to other retail optical franchises. Our retail footprint is primarily dedicated to our showroom where customers can find the exact frames they want.
