The Rising Costs of Commercial Real Estate and Ways Optometrists Can Adapt

Have you noticed how crazy expensive commercial real estate has become lately? The commercial real estate market has experienced an unprecedented surge in costs over the past few years, impacting the profitability and sustainability of many small businesses, including optometry. Let's dive into why these costs are skyrocketing and how we can adapt to keep our businesses thriving.

Theories behind the Rising Costs of Commercial Real Estate:

1. High Demand and Limited Supply: One of the primary reasons for the increasing costs of commercial real estate is the imbalance between high demand and limited supply. With cities growing faster than ever, there's a massive demand for commercial spaces. The problem is, there aren't enough suitable places to meet this demand. This scarcity of available spaces in prime locations has led to intense competition among businesses, driving up prices.
   

2. Urbanization and Gentrification: The process of urbanization and gentrification has had a significant impact on commercial real estate prices. As more people flock to urban areas in search of employment opportunities and convenient lifestyles, the demand for commercial spaces has surged. Plus, the gentrification of rundown neighborhoods is pushing up property values, making real estate even pricier.
   

3. Economic Factors and Inflation: Economic factors, including inflation and interest rates, play a crucial role in the rising costs of commercial real estate. When the economy is strong, businesses are more willing to invest in expanding their operations. This increased demand drives up prices. Furthermore, inflation erodes the purchasing power of money, making everything from construction materials to labor more expensive, which adds to the overall cost of real estate.
   

Adapting to the Rising Costs:

In the face of escalating commercial real estate costs, we can use different strategies to adapt and navigate this challenging landscape:

1. Explore Shared Spaces: Optometrists can consider sharing commercial spaces with other healthcare professionals or complementary businesses. This arrangement allows for cost-sharing and can significantly reduce the financial burden of leasing or purchasing a dedicated space. Although commercial lease partnerships may not be everyone's first choice, I believe it will become more necessary as costs continue to rise.
   

2. Embrace Telehealth: Advancements in technology have opened up new opportunities for optometrists to expand their services through telehealth. By offering virtual consultations, remote monitoring, and digital eyewear prescriptions, optometrists can reduce the need for large physical spaces and the associated costs. Please note: Telehealth is not legal for optometrists in every state. Check with your state board before implementing telehealth in your practice.
   

3. Optimize Space Utilization: Optometrists should focus on optimizing their physical space. By utilizing space efficiently and adopting open-concept designs, they can reduce the overall square footage required, thereby decreasing the associated costs. Look into equipment that can do multiple tests in a smaller footprint, or consider handheld equipment, to eliminate the need for a separate pretesting room altogether.
   

HAR-1000 Autorefractor

HFC-100 Portable Fundus Camera

CT-450S 3 Instrument Exam Unit

SW-500 Tonometer

4. Cutting Overhead: Optometrists forced to pay high rent prices may need to consider cutting practice costs elsewhere. This may involve reevaluating and streamlining office processes, reducing staffing levels, and implementing other cost-saving measures. Need help? Take a look at our Cost Savings Analysis service.

In conclusion, the rising costs of commercial real estate present a real challenge for today's practice owners. By getting creative with smaller spaces and embracing new technologies, we can keep our practices thriving in this changing economy. Check out my other posts, including this one on maximizing reimbursements using embedded vision plans.

The products recommended on this page are from verified ophthalmic equipment vendors. Although you may find a lower price advertised by other suppliers, I can not vouch for their quality or authenticity.

I may receive a commission from the seller on the products featured on this post. That being said, my opinions are my own and are not influenced by any potential income.

Supplying a New Office on a Shoestring Budget

So, you've decided to open your new office, and now you're considering taking out a large equipment loan to purchase everything you need. The equipment rep has assured you that it won't be a problem - you'll be so busy, and the money will be rolling in! All you have to do is sign. But wait! Before you do that, let me share a cautionary tale from my own experience.

The Costly Mistake I Made in My First Private Practice

My first attempt at private practice was disastrous for many reasons, one of which was buying too much equipment. I listened to salespeople who assured me that my equipment was a good investment and would pay for itself in no time. The exhibit hall at Vision Expo became my shopping mall, and I thought with the best (most expensive) equipment, there was no way I could fail. But I did. Eventually, I was more than 90 days behind on my equipment payments and had to close my practice.

Learning from Failure: A Second Chance

Fast forward ten years, and I'm a lot smarter about my money. When I decided to try private practice again, I promised myself I would do better. With a little searching, I discovered that you can purchase new, high-quality equipment at a fraction of what big brands are asking.

My best advice for new business owners: Check out AliExpress. I know dealing with Chinese suppliers can be intimidating, but when buying from a reputable seller, you can get some really amazing deals.

A Reliable Supplier for Affordable Optometry Equipment

Below, I've compiled a list of inexpensive ophthalmic equipment from one of my favorite suppliers, Link Ophthalmic. I've ordered from Link for many years and have had good experiences with both the quality of their products and their customer service. The prices listed are current as of the time of this blog posting and include shipping.

ML-400 Phoropter

Manual Lensometer

LCD Visual Acuity Chart

SL-5A Slit Lamp

Retinoscope and Ophthalmoscope

YZ-25B Binocular Indirect

Tonometer

Patternless Edger

Combined Chair and Table

1. Manual Phoropter - $793.24 This is a standard minus-cylinder phoropter. In my opinion, it works just as well as more expensive brands like Topcon or Reichert.
   

2. Lensometer - $382.55 This lensometer reliably measures sphere, cylinder, axis, add, and prism. It can also be used to mark lens blanks for edging.
   

3. 19" LCD Chart with Remote - $419.36 This chart is high tech and looks amazing. Also available in 21". Compare to similar charts priced at over $1500.
   

4. Slit Lamp - $2,201.23 A solid option for a slit lamp. This base model works just as well as any slit lamp I've used before. You will need to add a tonometer like the one below.
   

5. Retinoscope and Ophthalmoscope - $545.09 A retinoscope is a must have, especially if you don't have an autorefractor. This streak retinoscope works just as well as other big name brands.
   

6. Binocular Indirect - $1473.84 This base model BIO works great and is comparable to other models priced at over $2500.
   

7. Slit Lamp Tonometer - $392.53 This tonometer attaches to your slit lamp. If given the option, choose a "R Type" tonometer over a "T Type". They both work well, but you'll find the "R Type" in most optometry offices.
   

8. 3 Instrument Stand with Chair - $3500 Technically, you really don't need this fancy of a chair/stand unit, however, I think the price makes this a great buy, even for startups. Place your slit lamp on one table and add more equipment as your practice grows. Check out my blog post where I talk about the space saving features of this table.
   

9. Molo-1000 Patternless Lens Edger - $4500 I wouldn't say that a lens edger is 100% necessary for starting your own practice, but you may want to consider it if you have an optical. The outrageous price of lab fees make this a smart investment and can lower your cost of goods significantly.
   

Total equipment cost $9,707.84 ($14,207.84 with edger)!

As you can see, you can buy new equipment for your practice without breaking the bank. This list is just a sampling of all the great deals you can find. If you have any questions about finding a reputable supplier or ordering from overseas, please reach out to me and I'll be happy to help.

Some products may be subject to import taxes. These are additional fees you might pay (usually to the shipping company, such as FedEx.) Please contact the seller if you have questions about import fees. I may receive a commission from the seller for the products featured in this post. However, the opinions are my own are not influenced by any money I may receive. You, the buyer, will never be responsible for any commission fee.