Vision Opticals: Target Customers And Marketing Strategy

Defining Target Customers

The business plan will start with providing business description and vision statement of the company named as “Vision Opticals”. Optic industry is generally referred as optical and medical industry and includes optical and ophthalmic industry. The company will start as a low profit and low risk optical shop and will initially open 5 stores in various places of Canada including Whistler, Toronto, Quebec City, Tofino and Old Montreal. It will offer various products like Designed wear, Lens, Accessories and services like Eye exam and various professional services.

“Vision Opticals” will be low profit and low risk optical shop which will be owned by Mr. Mathew Harley who have more than 10 years experience and is a licensed optician. Patient’s requirement and needs will be the highest priority for the business. The business will initially open 5 stores in various places of Canada including Whistler, Toronto, Quebec City, Tofino and Old Montreal with its operation head office at Toronto (Andries, Debackere & Looy, 2013). The business will plan opening further shops over the next 3 years period. The store will get exclusive right for selling Alexandar Macqueen in its Whistler shop and Michael Kors for its Toronto shop.  The stores will be mod to high end stores for optical items. Further, through introduction of various well known brands like Ray Ban, Gucci and Versace it is expected to increase its sales significantly within next 2 years of operation (Birkin, Clarke & Clarke, 2017).

Optical market in Canada is expected to record the steady growth in 2018 with the sales supported by ageing population those require vision correction, marketing campaigns and launches of new products from leading brands. Further, the optical market growth was driven by the increasing number of people with presbyopia and myopia. It is projected that prevalence of myopia among the Canadian people have been increased significantly over last decade along with increase in using the electronic devices and lower time spent in outdoors (Belz & Binder, 2017). Luxotica is main competitor as it is the global leader in selling sunglasses and involved in designing, distributing, manufacturing and retailing of eye ware. Further, Luxotica has strong presence in Canada apart from the well known brands like Oakley and Ray Ban.

As per the industry source, 60% of the Canadian optical shops are owned independently. It is anticipated that the optical market in Canada will continue its positive growth over the next 5 years period and the sales will be supported by the favourable demographic trends (Blackburn, Hart & Wainwright, 2013).

Factors that Influence Customers

Mathew Harley will be the CEO and Chairman of the business named as Vision Opticals. Various other heads of the business will be headed by Business operation manager, global research manager and human resource manager. Further, the business operation manager will look after the finance division and legal division those will be headed by financial executive manager and legal manager respectively.

Vision Opticals will offer various products as follows –

1. Designed wear – It will provide different types of sunglasses, frames and sportswear. Properly fitted and sealed eye ware will provide maximum protection as the sportswear. Further different sizes and styles will be provided for frames and sunglasses as per the need and tastes of customers.    
2. Lens – Contact lens and ophthalmic lens from various well-known brands. It will also deal with the in-house fashion contact lens for the people aged between 18 years to 35 years. The customers can purchase daily, month, or weekly contact lenses with their prescription (Bocken et al., 2014). They can also directly work with one of the professionally trained Contact Lens Fittersfor discussing best type of lens suitable for individual needs based on the intended use.
3. Accessories – health of the eyes is major priority for Vision Opticals. Various accessories it will deal in are lens coating and solution for lens. 3 types of anti-coatings those will be provided by the company are easy clean, premium Teflon coating and transition coating that will go lighter or darker.

Different services those will be provided by Vision Opticals are as follows –

1. Eye exam – the stores will assist in recognizing the general health condition of the customer as that is detected first through the eye exam. Further, it will provide referrals to the specialists and will help in managing the post-eye surgery health.
2. Professional services – independent optometrists and licensed opticians will be hired by the company who will help the customers in solving various eye related queries.     
3. Insurance billing – the company will have dedicated 2 windows for lenses, designer frames, lenses and sunglasses for dealing with the bill approved by the insurance plan.

Massive increase in the sales of the optical products can be seen in Canada. As per the Vision Watch Canada Report from the Vision Council, in the year 2017, Canadians purchased over 7.5 million pairs of frames and they spent approximately $1.42 billion on the new spectacles (opticalprism.ca, 2018). In addition, approximately 66.8% of the Canadians used spectacles as per prescriptions in the same year. In addition, the people of Canada change their spectacles every 2.7 years on average basis. 68% of the adult Canadians wear corrective lenses and 84% adult Canadians wear sunglasses (opticalprism.ca, 2018). 12% of the adult Canadians wear eyeglasses as per their prescriptions. All these aspects indicates towards the marker dynamics of the Canadian optical shop industry as they create business opportunities both for the existing as well as new businesses (opticalprism.ca, 2018).

In Canada, the presence of approximately 16 million presbyopes and 17 million single vision users can be seen (eyecarebusiness.ca, 2018). At the same time, Canada has a large young generation; and they use eyeglasses and lenses for the purpose of both style and need. One major growing problem affecting 30% of the Canadian population is Myopia. Its increasing occurrence can be seen among the children that is 6% among 6 to 8 years old and 29% among 11 to 13 years old(eyecarebusiness.ca, 2018). 72% adults of Canada aged between 18 to 39 years old use at least three electronic devise per day and the heavy usage of these electronic devises like laptop, smartphones and others affects their eyes. In addition, more than 5.5 million Canadians have major eye diseases; and this population includes aged people, women and others. It is required to take into consideration these demographic data for the target customers (eyecarebusiness.ca, 2018).

It can be seen from the above discussion that different demographic groups of Canada has the demand for spectacles, frames, lenses and sunglasses. In this context, it needs to be mentioned that the customers will not be targeted based on income and level of education as people rich or poor, educated or not have the desire to look good. First, Vision Opticals will target children from 6 to 13 years due to the fact that they need glasses or lenses as per prescription (Baker, 2014). Second, the next target group of the company will be the group of Canadians from the age 18 to 40 years as this group has demand for the sunglasses and power glasses as well as lenses due to their desire for looking good and excessive use of electronic devises. Lastly, the company will target the group of aged Canadians as they needs power glasses due to their different kinds of eye diseases (Baker,2014).

Business Plan for Vision Opticals

In case of advertisements, Vision Opticals will adopt certain strategies. First, the company will use the traditional advertisements avenues like newspaper, television and radio for the purpose of providing the information of their variety of products to the potential customers of the selected areas of Canada (Armstrong et al., 2014). At the same time, the company will also use the internet as well as social media with the aim to advertise their products by targeting the selected target customers. Apart from these, Vision Opticals will use large hoardings, posters and leaflets for advertising their products. Lastly, the company will send direct mails about their products their customers (Armstrong et al., 2014).

It needs to be mentioned that Vision Opticals will have certain unique selling propositions (USPs) that will differentiate the company with their competitors; and they are mentioned below:

• High quality of the products of Vision Opticals will be one of the major USPs of the company as the aim of the company will be not to compromise with the quality of services and products.
• The next USP of Vision Opticals will be cheap price of their sunglasses, lenses and frames as the aim of the company is to provide eye care solutions to every group of customers (Nijssen, 2017).
• Colour and high stability of sunglasses and frames will be another USP of Vision Opticals as they will not be damaged from the exposure of sunlight, aim and pollution.
• The sunglasses and lenses will block the harmful UV rays along with other rays and it is another major USP of the company.

The plan of Vision Opticals is to make the prescription and non-prescription glasses, lenses and frames affordable to middle as well as lower income individuals. At the same time, another aim of the company will be to beat the competitors to gain market share and attract customers. For these reasons, Vision Opticals will adopt the market penetration pricing strategy that will allow the company to set low initial price for their products. This will help the company in gaining market share along with increasing the amount of revenue (Spann, Fischer &Tellis, 2014).

In case of the positioning, the aim of Vision Opticals will be to position them as a low-cost provider of optical products and services. More specifically, the aim of the company is to breakaway both the prescription and non-prescription glasses from their current association with the medical devices so that they can be reclassified as fashion accessory (Solomon et al., 2014).

It needs to be mentioned that the customers will have to visits the shops of Vision Opticals for purchasing their products. In case of the patients, they will have to bring the prescription based on which glasses or frames will be provided. In addition, the non-prescription customers can select and buy sunglasses, frames and lenses from the variety of stocks of the company.

In this context, it needs to be mentioned that Vision Opticals will use certain marketing tactics for their new business. First, the company will exploit the online networks, blogs as well as discussion groups with the aim to develop brand awareness. In addition, the company will offer free product samples to the opinion leaders who will be able in presenting positive image of their products in the community. Vision Opticals will also adopt the strategy to place their products in the mass media like magazine articles, news shows and others. Apart from this, the company will involve in developing promotional videos for drawing attention to their brands through certain channels like YouTube and their official website (Kotler, Kartajaya&Setiawan, 2016).

Market Dynamics of Canadian Optical Shops Industry

The earlier discussion indicates towards the fact that Vision Opticals will be opening their store in five specific place of Canada; they are Whistler, Toronto, Quebec City, Tofino and Old Montreal. At the same time, the head office of the company will be at Toronto. The main reason behind the selection of these places is their high population having the target customers. Apart from this, these places are easily accessible due to good transportation services and conditions. All the stores will be located beside the main road for the ease of accessibility (Jacobs, Chase &Lummus, 2014).

It needs to be mentioned that Vision Opticals will need building or certain facility for the establishment of their optical shops. According to the requirement of the buildings, open space will be required for the purpose of displaying the sunglasses, frames and lenses. In addition, the customers will need space so that they can freely see the displayed products. However, there will be requirement for another room for the doctor and for placing the equipment for testing eyes (Slack, Brandon-Jones & Johnston, 2013).

Vision Opticals will have certain requirement related to staffs and personnel; and the company is needed to ensure the hiring of these staffs before the commencement of their business operations. For all the stores in the five places, the company will be required sales staffs for selling the frames, sunglasses and lenses. After that, Vision Opticals will be required eye specialist doctors in each of their stores with the aim to provide glasses and lenses as per the prescription. At the same time, there is a requirement of maintenance staffs in each of the stores. In this context, it needs to be mentioned that Vision Opticals will not face much difficulty to recruit staffs for their business from these locations due to the presence of job demand in these areas. In addition, the presence of colleges will ensure the supply of seasonal employees in the company (Kakarika, 2013).  

Vision Opticals will be required shelving arrangements for displaying the stocks. In addition, the company will required certain other equipment for their new business. For the purpose to take the measurement of patients face, the required equipment like simple ruler and sophisticated digital pupillometer. The required processing equipment are grinding or surfacing equipment and edging equipment. These are uses to create the desired curvature of the lens and to shape the lens. There is a need for a computer for storing data related to products inventory, sales and others. Other required equipment are frame warmer, screwdrivers, adjustment pliers, trial lenses and others. These equipment must be there before commencing the business (Slack, Brandon-Jones & Johnston, 2013).

Target Customers Based on Demographics

Suppliers will play a vital role in the business of Vision Opticals as third parties will be responsible for supplying the lenses, sunglasses and frames. The major suppliers of the company will be Alexandar Macqueen, Ray Ban, Gucci, Versace, Warby Parker, Oliver Peoples, Mykita, Moscot, Oakley, Jimmy Choo and others.

One major business requirement for Vision Opticals will be to decide besides buying or leasing the building or equipment. As the selected places for the shops of the company are in the populated areas, the company will have to incur huge costs for buying the building facilities. Incurring this large amount of expense may be difficult for the company. For this reason, it is needed for Vision Opticals to go for lease agreements with the aim to facilitate the buildings. At the same time, the company will buy the required equipment for the business.

At the same time, Vision Opticals is needed to take into consideration the maintenance of their building and facilities. It will be required for Vision Opticals to recruit specific personnel who will be responsible for the maintenance of their building facilities. They will be responsible for maintaining the good health of their building facilities. In case there is any significant issue related to the maintenance of building and facility, they will be responsible for taking the required steps to keep things in order (Zikmund et al., 2013).

• CEO – Mathew Hareley who will also be the Chairman of the company will look after the entire operation of the business.
• Business operation manager – Luigi Del Vecchio will be appointed as the business operation manager and will majorly look after the financial updates and legal updates of the company. He will also look after the risk management, asset protection and compliance department. Further, corporate and legal affairs will also be handled by him.
• Financial officer – Stefani Milleri will be appointed as chief financial officer for the company who will look after all the financial matters and will directly report to the business operation manager.
• Legal executive – Marina Grassi will be appointed as legal executive for the company who will look after all the legal matters and will directly report to the business operation manager.
• Global research manager – Karl Notari will be appointed as the global research manager. He will be engaged in continuous research regarding the new innovative eye related products launched in the global markets that will assure the customers to get best possible services and products.

• Mathew Hareley – Mr. Mathew graduated with law degree from University of Florence. He also worked there as assistant professor of economics for 5 years. He also completed MBA in the business administration from school of management, Canada with high merit followed by specialization in the stream of Corporate Finance. He has more than 20 years experience working in different industries including consumer goods, pharmaceuticals and financial institutions.   
• Luigi Del Vecchio – he is a graduate with degree of business administration from New York. He also has wide experience in financial matters and have working experience of 6 years as finance manager.
• Stefani Milleri –  she has a degree of accounts and finance and have more than 10 years experience in training and research in finance and banking at different universities. He also has 5 years experience of working with an optometric service provider company.  
• Marina Grassi – she is a graduated from University of Toronto with the degree of law. He has more than 10 years experience of working various industries including consumer goods, pharmaceuticals, financial institutions, optometric industries.
• Karl Notari – he has a degree in ophthalmology from university of Alberta. Further he was involved in a eye related research work for 5 years in University of Manitoba. He also worked as a research manager in an optometric service provider company for more than 6 years.Financial Plan

Initially the products from the big brands like Ray Ban, Gucci and Versace will be taken at 50% credit for 1 year. For other requirements like purchasing of equipments, store maintenance, payment to the professionals and managers it will avail funds from different sources as profit is expected after 6 months of business operation. It is planned that the 50% of the capital will be raised through debt financing from private lending institutions, chartered banks, credit unions and financial companies. 30% of the fund will be raised through equity financing from corporate investors, private investors and Canada Development Corporation. Rest 20% will be raised from other sources including bootstrapping and crowd funding.

Source of finance details are as below –

• Debt financing – debt financing is the borrowing of money that is required to be repaid at future date with the interest. It can be both secured as well as unsecured and both short term as well as long term (Scarborough, 2016).

Advantages –

• Control – taking the loan is temporary and the relationship comes to an end with the repayment of debt. Further the lender does not have any control how owner runs the business.
• Taxes – Debt interest is deductible under tax whereas dividend payment on equity is not
• Predictability – interest payment along with principle are mentioned in loan agreement in advance. Hence, it is easier for the company to work on its cash flow (Scarborough, 2016).

Disadvantages –

• Qualification – new business like Vision Optical may not have required credit rating to be qualified for getting loan
• Fixed payments – interest and principal payments shall be made on particular date without any fail. Businesses have unpredictable flows of cash that may cause difficulties in payment of loan (Scarborough, 2016).

Equity – with funds from investors owner is relieved from the pressure for meeting deadlines on fixed loan payments. However, some control on the business is to be given to the investors that may have impact on major decisions (Drover et al., 2017).

Advantages –

• Less risk – with equity financing risk level is low as the company does not have to make any fixed payments. It is helpful for the start-up businesses as they may not have positive cash flows initially.
• Credit issues – there may be credit issues for the start-up businesses, however, for the purpose of growth the start-up may move to equity financing (Drover et al., 2017).

Advertising Strategies for Vision Opticals

Disadvantages –

• Control – owner will have to give up some control of the business when he raise funds from investors. Further, the equity investors will take part while making business decisions.
• Cost – equity investors are paid return through share of profit and dividends. Amount of profit paid to the investors may exceed the interest paid on debt (Drover et al., 2017).
• Bootstrapping – it is the money that will be raised through the customers and small investors (Senthilkumar & Mayuri, 2014).

Advantages –

• Minimize the external borrowing
• Payments can be delayed

Disadvantages –

• Personal risks – as the small investors and customers are main contributor they are generally not well connected with the business as other investors.
• If their opinion and advices are not considered they may lose interest in investing (Senthilkumar & Mayuri, 2014).

Crowd funding – it is generally raising funds through collecting from small contributors including general public using the social media and internet (Belleflamme, Lambert & Schwienbacher, 2014).

Advantages –

• Fund can be raised in faster way without any upfront fees
• It can be an alternative option to raise funds when struggling with raising from bank
• Investors may track the progress which in turn helps to promote the business (Belleflamme, Lambert & Schwienbacher, 2014).

Disadvantages –

• It is not easy to raise funds through crowd funding as compared other traditional sources
• If the business concept is not copyright or patent protected someone may steal the idea from crowd funding site (Belleflamme, Lambert & Schwienbacher, 2014).

Based on the advantages and disadvantages of various source of finances the company’s financial source will be as follows –

Finance type	Source Name	Amount
Debt
Borrowing from private lending institutions @ 12% p.a	Tribecca finances	$   1,80,000.00
Borrowing from chartered banks @ 10% p.a	Royal bank of Canada	$   2,10,000.00
Borrowings from Credit unions @ 13% p.a	Servus credit union	$      90,000.00
Borrowings from financial companies @ 14%  p.a	Futura Corporation	$      80,000.00
Total fund through debt		$   5,60,000.00
Equity
Corporate investors		$   1,24,000.00
Private investors		$   1,02,000.00
Canada Development Corporation		$   1,10,000.00
Total fund through equity		$   3,36,000.00
Fund through bootstrapping		$   1,52,000.00
Fund through crowd funding		$      72,000.00
Total requirement		$ 11,20,000.00

References

Andries, P., Debackere, K. & Looy, B., (2013). Simultaneous experimentation as a learning strategy: Business model development under uncertainty. Strategic Entrepreneurship Journal, 7(4), pp.288-310.

Armstrong, G., Adam, S., Denize, S., & Kotler, P. (2014). Principles of marketing. Pearson Australia.

Baker, M. J. (2014). Marketing strategy and management. Macmillan International Higher Education.

Belleflamme, P., Lambert, T., & Schwienbacher, A. (2014). Crowdfunding: Tapping the right crowd. Journal of business venturing, 29(5), 585-609.

Belz, F. M., & Binder, J. K. (2017). Sustainable entrepreneurship: A convergent process model. Business Strategy and the Environment, 26(1), 1-17.

Birkin, M., Clarke, G., & Clarke, M. (2017). Retail location planning in an era of multi-channel growth. Routledge.

Blackburn, R.A., Hart, M. & Wainwright, T., (2013). Small business performance: business, strategy & owner-manager characteristics. Journal of small business & enterprise development, 20(1), pp.8-27.

Bocken, N.M., Short, S.W., Rana, P. & Evans, S., (2014). A literature & practice review to develop sustainable business model archetypes. Journal of cleaner production, 65, pp.42-56.

Burns, P. (2016). Entrepreneurship and small business. Palgrave Macmillan Limited.

DaSilva, C.M. & Trkman, P., (2014). Business model: What it is & what it is not. Long range planning, 47(6), pp.379-389.

Drover, W., Busenitz, L., Matusik, S., Townsend, D., Anglin, A., & Dushnitsky, G. (2017). A review and road map of entrepreneurial equity financing research: venture capital, corporate venture capital, angel investment, crowdfunding, and accelerators. Journal of Management, 43(6), 1820-1853.

Embracing the Future of Our Industry • Canadian Eye Care Business. (2017). Canadian Eye Care Business. Retrieved 11 December 2018, from https://eyecarebusiness.ca/embracing-the-future-of-our-industry/

Hvass, K. K. (2015). Business Model Innovation through Second Hand Retailing. Journal of Corporate Citizenship, (57).

Jacobs, F. R., Chase, R. B., &Lummus, R. R. (2014). Operations and supply chain management (pp. 533-535). New York, NY: McGraw-Hill/Irwin.

Kakarika, M. (2013). Staffing an entrepreneurial team: diversity breeds success. Journal of Business Strategy, 34(4), 31-38.

Keller, B., Schmidt, R., Möhring, M., Härting, R. C., & Zimmermann, A. (2016, September). Social-data driven sales processes in local clothing retail stores. In International Conference on Business Process Management (pp. 305-315). Springer, Cham.

Klang, D., Wallnöfer, M. & Hacklin, F., (2014). The business model paradox: A systematic review & exploration of antecedents. International Journal of Management Reviews, 16(4), pp.454-478.

Kotler, P., Kartajaya, H., &Setiawan, I. (2016). Marketing 4.0: Moving from traditional to digital. John Wiley & Sons.

Nijssen, E. J. (2017). Entrepreneurial marketing: an effectual approach. Routledge.

Prism, O. (2018). Hot Canadian Eyewear Market | Optical Prism Magazine. Opticalprism.ca. Retrieved 11 December 2018, from https://opticalprism.ca/hot-canadian-eyewear-market/

Scarborough, N. M. (2016). Essentials of entrepreneurship and small business management. Pearson.

Senthilkumar, A. A. R., & Mayuri, P. (2014). Efficient Bootsrapping and Query Adaptive Ranking for Image Search. The International Journal of Science and Technoledge, 2(5), 174.

Slack, N., Brandon-Jones, A., & Johnston, R. (2013). Operations management. Pearson.

Solomon, M. R., Dahl, D. W., White, K., Zaichkowsky, J. L., &Polegato, R. (2014). Consumer behavior: Buying, having, and being (Vol. 10). London: Pearson.

Spann, M., Fischer, M., &Tellis, G. J. (2014). Skimming or penetration? Strategic dynamic pricing for new products. Marketing Science, 34(2), 235-249.

Zikmund, W. G., Babin, B. J., Carr, J. C., & Griffin, M. (2013). Business research methods. Cengage Learning.