In So Many Words is a timely talk with an ophthalmic industry thought leader.
Ask Rick Lombart if he can give an interview on a particular day of the week, and his reply depends, he says, with tongue somewhat in cheek, on whether his fishing buddy is available first. This codirector of Lombart Instrument — his partner is brother Kenneth — no doubt has a laid-back, life’s-meant-to-be-lived mien.
That relaxed bearing, which reveals itself as somewhat anti-tech, also shows in the company’s website. Brightly colored with links to its many locations, the site features images of Lombart staff that work in those locations. If there isn’t a picture, there is a stick person. Many have been with this 40-year-old ophthalmic instrument distribution company for decades.
The Lombarts might eschew sounding and looking like Amazon, but the company hasn’t been around this long and at the top of their particular game without having determined what works. Being Sigma-6 lean isn’t company policy, neither is relying solely on the power of analytics. It’s the ken that counts. “Data is not as good as experience,” says Rick Lombart. “It’s not as good as the computers in our heads.”
Ophthalmology Management: What is the problem with being solely data driven?
Rick Lombart: We believe in the personal touch — live people answer our phones here. We have a group in customer service who answer the phones.
I like to sell like I like to buy: I want good advice, good service from someone who is valuing [my] time.
Doctors have a tough enough time in their day-to-day practice. They don’t need a tough time from their equipment suppliers.
OM: Is this approach appreciated?
RL: The majority of our customers — a wild guess is 80% — are repeat and referral. We get new customers every day, but the bulk of our sales is repeat business.
OM: How does a company get to 80% repeat business?
RL: As your business grows you have to tailor your needs to growth. But we have great people, good suppliers and great customers, and when you put all of them together that makes for a successful business. You can’t sell from an empty store. What has made us successful, the answer [to your question] is logistics; we changed the business. We changed [the industry] from a long lead-time to immediate delivery, with inventory. It’s how my dad got into the business.
OM: Can you speak to that, please?
RL: Our dad was an optometrist. Back then, in the ‘50s, he had to wait six weeks for a lens. So he made lenses in the back of his office. In 1959, he quit optometry to go into manufacturing contact lenses.
Kenneth got into the business in 1969, and decided he would cut the base curves and then inventory the lens. Kenneth convinced dad, ‘let us build (the inventory) and they will come.’ (He was right.)
We started to inventory; we built our business. Now it haunts us, because everybody wants it yesterday. We changed the industry. We have a $15 million (slice of it.)
OM: What other changes did you make?
RL: When we started, our customers were looking for slit lamps and other instruments to fit these hard contact lenses, which cost the doctor $4.50 a lens. Ken figured he could sell just the hard contacts, but the margin wasn’t good. So in 1978 the company got into soft contact-lens manufacturing.
OM: How large is your inventory?
RL: A little more history. Along the way we acquired the assets of other companies, like WCO, Essilor, Franklin Optical and others. We probably have 10,000 SKUs but the bulk is in the couple of a hundred: chairs, stands, slit lamps, auto refractors, retinal cameras, perimeters, OCTs. Those are the most popular items. The basic room lane equipment is still the bulk of the business.
OM: When did you join the company?
RL: Late 1976. It was then we started making acquisitions, over the next 20+ plus years. We now have 135 people on staff and 26 office locations in places like California, Texas, Virginia, Florida, the Midwest, the Great Lakes region and New England.
In 1998, we acquired the instrument division of Essilor.
OM: How many physicians are your clients?
RL: We do business with 10,000 plus doctors a year.
OM: Let’s talk about management again.
RL: There is a certain amount of data, but it’s not as good as the computers in our heads. Yes, we are tracking and anticipating what customers will want and what trends will come next. But data ARE not as good as experience. Traditionally, we have controlled growth. Our part of the business is very difficult. My son came into the business, he is 29. He would send me pictures when he would get to a practice. He’ll ask, what is this? I will say, that piece is discontinued.
People don’t have an appreciation for how hard this job is. In some cases, sales reps are looking at 40-year-old equipment. A good sales rep takes five years before they are decent.
Today, everything is geared to data, and that is good for shoes or cellphones, but it’s not as good for ophthalmic technicians, people whose income is being stymied by a bean counter — it is wonderful for the bean counter to say a procedure is not worth $100 until it is their eye.
OM: Are you feeling the effects of the decline of the solo practice?
RL: Yes. As practices consolidate, it definitely changed the buyer, but it hasn’t changed the need. We have good sales people, they maintain relationships with doctors. Even though the doctor may not be writing the check, the doctor is usually specifying the need for equipment and technology.
In most cases, the office administrator will follow the doctor’s request as long as it is justified. It is like patients who want a better deal someplace else until their eye is red. What happens is that the administrator thinks about money and not how his or her decision on a purchase affects the practice.
We are a service company. Because of our size we deal across the spectrum.
The majority of our customers are practitioners who are trying to practice personalized medicine as much as insurance companies are trying to change the way they practice and dictate to them what they can do. OM