MARK Ross has spent the last two years talking expansion, and, while there have been a few bolt-ons here and there, “explosive” is not the word that comes to mind when describing the spread of the Black & Lizars chain.
It’s not been for a lack of trying. The company is working on a new flagship store in Edinburgh’s Frederick Street, but this is replacing two outlets in Rose Street and George Street.
The tally will only be evened when the Glasgow-based group completes the planned acquisition of another well-known optometry practice in the capital, a deal that Ross hopes to close within the next two months.
But even then, the chain will remain at 25 practices, one of which is in Belfast with the rest scattered across Scotland. The group recently passed on an acquisition that would have taken Black & Lizars into England in a big way, but its chief executive is not the least bit contrite.
“We had an opportunity at the end of last year to at least double the size of the company, if not more, but we turned it down because it was not of a quality that fits our model,” Ross says. “There are plenty of optometry groups out there that are bigger than us, but not profitable. We are still talking to some groups in England, but I would rather fall short of our expansion target than join the growing ranks of unprofitable optometrists.”
The notional goal is to reach 40 practices within a couple of years, a target Ross has been talking about since 2012. However, that also coincided with a shift in the company’s strategy to deal with what has proven to be rapid change across the profession.
Ross likens it to what has happened in the supermarket sector, with those in the middle ground squeezed out by the discounters at one end and upmarket players at the other.
Ironically, it is the efforts of supermarkets to defend that middle ground which is driving change in the optometry sector.
Asda now has optometrists within 137 of its stores, and plans to raise that to 300 within two years in a bid to hang on to customers being lured elsewhere.
Tesco is looking to do something similar in response to the erosion of its market share by the likes of Aldi and Lidl.
Situated within the larger stores, supermarket optometrists have lower overheads than their high street counterparts, allowing them to undercut rivals such as Boots and Specsavers. This is a strong draw for consumers, who have seen their wages eroded despite an improving economy.
“Inflation is still eating away everyone’s pay packets,” Ross observes.
“That situation, in my opinion, will continue for some time.”
Rather than chase the bulk of the market down to the lowest possible price point, Black & Lizars has formulated a strategy to move beyond the mere “retailing of spectacles”. With full backing from the group’s owner, private equity investor John Hare, Ross is investing to become what he calls a “health company”.
Black & Lizars has ten OCT machines and six of the wide retinal scanners produced by Scottish-based Optos, with the latter set to rise to ten within the next few months. Set side-by-side, these two machines represent an outlay of about £100,000.
“Together they are a very powerful combination,” Ross says. “They allow us to pick up health issues much earlier, which greatly increases your chances of successful intervention.”
In total, the company has spent some £5 million during the past two to three years on scanners, other clinical equipment and modern shopfitting.
“That figure is only going to go up,” he adds. “We realise that to pursue this healthcare model, we have got to invest further.”
Together with a focus on the older, more affluent section of the population, this strategy appears to be paying off.
Although now in the key trading period that could swing results significantly, Black & Lizars looks set to generate a profit of about £900,000 on turnover of roughly £14m for the year to the end of September. That compares to a profit of £700,000 on sales of £13m previously. The chain has about 200,000 patients across Scotland, making it the country’s largest independent. It conducts about 60,000 eye tests every year, and provides a number of other services.
Having worked at various stages in his career for Diageo, Kwik-Fit and Macdonald Hotels, Ross’s ultimate ambition is to run a business that he also owns.
In the meantime, however, he says he has a lot of autonomy in what is a very “exciting time” for Black & Lizars.
“I am not expecting things to get any easier in the next couple of years, but it is great to be doing something like this in a challenging market,” he says. “We are building on something that was already there, but taking it to the next level.”
Born: 1974, Bishopbriggs, near Glasgow.
Education: Turnbull High School; University of Glasgow, bachelor of accountancy.
First job: A gardening round in Bishopbriggs during the summer, and a labourer for his father in industrial shelving during the winter. “It was quite hard, long work, but it was enough for me to scrape through university.”
Ambition at school: “I always wanted to run my own company.”
Can’t live without: My family.
Favourite city: Bangkok.
What car do you drive: “A Mondeo estate. During the difficult trading times when I was not giving my staff much or any pay rises, I didn’t think it was appropriate for me to be driving around in a flashy, expensive car.”
What makes you angry: “I get frustrated when I don’t see people reaching their potential or trying their hardest.”
What inspires you: “On a business level, I am most inspired by the entrepreneurs I have meet in Scotland who have founded and grown their own companies. This is something I have always dreamt of doing myself one day.”
Best thing about your job: “It is the team I work with. They are a very committed group with different skill sets, but together we get the job done.”