The New Generation of Lab Start-Ups: Technology Meets Tradition

Just a few years ago, when all lab news seemed to be about expanding corporate networks and consolidation, the idea of new independent startup labs might have seemed like a pipe dream. But it was a dream shared by a number of industry veterans, and for some, it has become a reality. And while innovation and technology are a key to their business model, they are creating a future for the independent optical lab through an appreciation of—and even a nostalgia for—its past.

The dominance of large labs has created an opportunity for small lab owners, who believe their labs can deliver the kind of personalized service and attention to detail they say is missing from supplier-owned lab networks.

“It is a good time to open a new lab because the independent eyecare professionals still want an independent lab choice, and those options were dwindling with the many acquisitions and closures,” said Ronald Cooke, president of R&D Optical in Cincinnati, Ohio. “In addition, there are some larger consolidations that have opened opportunities to service customers who might not be excited to be doing business with huge, controlling, establishments.”

Keith Grossman, president of Simplify Optics, a Valencia, Calif.-based start-up, also saw a gap in the market. “A lot of the labs are moving more to an outsourcing model, more of a call center-edging model, rather than a full-service model. And we think that if you make the right investments in people and equipment, you can address a portion of the industry that has not been addressed in the right way in the last 10 years.”

Start-up lab owners see a strong customer focus as a key differentiator in today’s optical market. Said Brandon Butler, co-founder and president of lab operations for Pacific Artisan Lab in Portland, Ore., “I think a lot of the labs have similar technology. You only have so many available options, so everyone’s kind of on the same plane—it’s the same thing with lens designs. But I saw a lack of customer-centric focus from bigger labs, and that’s what really drove me to start my own lab.”

Automation: Not Just for Big Labs Anymore
Sometimes thought of as a competitive advantage primarily for large, centralized labs, automation can also be an enabler for start-ups. Said Warren Meyer, a lab industry veteran who is in the process of opening Sierra Optical Laboratory, in Reno, Nev., “The new technologies have put advanced optical solutions in the hands of local operators.”

Butler sees this new level of precision available today as part-and-parcel to serving ECPs, and above all, patients: “(The latest equipment is) so pinpoint and accurate that we’re delivering a product to the consumer that is 10 times better than it was 15 years ago, before the advent of not only automation and robotics, but freeform technology.”

Grossman views freeform technology as a key to succeeding while staying small: “Because our lab is focused on producing 100 percent digital freeform backside progressives, you don’t have to keep the same size of inventory and you keep nearly everything you need on the shelf to produce every day.” The freeform-only approach also keeps manpower requirements low compared to traditional surfacing: “You had more human error, more manpower needed—it’s just a longer process.”

For Butler, human skill is crucial to the lab’s mission, and it is focused in the finish department. “Surface is more pushing buttons, and AR requires a lot of time and care and patience, but there’s not a lot of artistry; it’s more chemistry and attention to detail. But the finish side of the business, it’s just like somebody painting a picture. You have to create some artistry with it.”

Ryan Markey, president and CEO of My Friend’s Lab in Farmers Branch, Texas, took a somewhat different view of automation: “To me, automating and putting in digital … just because it’s available isn’t always the best idea.” He emphasizes the importance of skill and optical knowledge in every aspect of the lab. At My Friend’s Lab, this includes digital surfacing. “Everything is manually loaded and unloaded. I’ll spend a little more on labor dollars in order to make sure that I’m not wasting time and/or resources on putting a bunch of stuff through that’s inaccurate.”

Small Is Beautiful—and Personal
These labs view their relatively small scale as an opportunity to be closer to their ECP customers and provide a more personalized level of service. According to Mike Karlsrud, an industry consultant and president of the Karlsrud Company, “They’re not really worried about (doing) 6,000 jobs a day; they just want 200 really great jobs a day.”

Butler emphasized his lab’s desire to partner with practices who share their vision of providing premium product and premium quality to patients. “The vision is to give that consumer exactly what they paid for. They go out and spend $600 to $700 on progressive lenses, and in my opinion that’s the Lamborghini of the industry. I think the lab industry has lost touch with delivering that Lamborghini. That’s our focus.”

Markey stressed the importance of a highly versatile staff at My Friend’s Lab. “To me, the more our staff knows, the more they’re able to do. We spend a lot of time and effort on training our staff. Pretty much everybody who comes to work here has to be able to run everything.” This includes the customer service and even accounting personnel, who work in the production area when they are caught up on their other work. In this way, the entire staff stays close to the product and the customer.

Traditionally, the relationship between the ECP and the lab has been a close one, and some fear that this element has gotten lost through round after round of consolidation and automation. Today’s start-up labs want to restore that relationship and deliver a tailored service experience to their customer. Karlsrud noted that start-ups are “…beginning to be highly customized and highly relational. It’s a little bit of a throwback to the old school, where customer service and relationship-building were really in the forefront. It’s really a much more intimate experience than working with a large lab.”

Markey, for whom the relationships with ECPs are so important that “Friend” is part of his lab’s name, fears that the industry “has become so corporate in its mentality that the desire to help each other has disappeared. It was more about ‘Doctor, this is what I’ve got for you for your practice.’ It wasn’t, ‘Doctor, what do you need for your practice, and how can I assist you?’”

At Simplify Optics, the customer relationship permeates the entire organization, from the owners on down. “We think customers like to feel that connection to the lab, and understand that their immediate concerns are being addressed by hands-on people in the lab,” said Grossman. “It’s one phone call, and it gets you to somebody in the lab that can effectively expedite a job, or offer a quick solution or an answer.” He explained that the service is not just a matter of quality and turnaround time—there is an emotional element, too: “We think customers like to feel that connection to the lab, and understand that their immediate concerns are being addressed by hands-on people in the lab.”