Practically every business, from the independent SME to the multinational corporation, relies to a greater or lesser degree on borrowing to finance its operations – opticians are no exception.
In addition to equity investment – by partners or shareholders – opticians, too, may raise the essential capital they need by long-term borrowing secured against the firm’s or partners’ personal assets or consider the alternative of short-term unsecured fixed rate practice loans (i.e. loans for opticians), which may be provided by specialists in lending to professional enterprises.
Benefits of adequate funding
An adequately funded professional practice, such as that represented by the optician, becomes especially important when market conditions are healthy and buoyant. This is the environment in which new opportunities are opening up all of the time, to a receptive market, and the prospect of commercial success for your business.
This is precisely the positive environment identified by market researchers Euromonitor International. There is currently a momentum driving increased demand for eyewear in the UK, say the researchers, and this is driven by three main forces:
- the overall population profile is becoming increasingly older, and older people tend to need more in the way of eyecare – since the mid-1970s, there has been a 47% increase in the population aged 65 and over, so that this group now makes up some 18% of the total population, says the General Optical Council (GOC), which adds that the over 75 population has grown even more appreciably (89%) over the same period and now represents 8% of the total population;
- a greater and greater proportion of the population is also spending more and more time in front of computer screens, whether at work or at home, and on smartphones – and this trend underlines increasing demand for appropriate eyewear; and
- partly, but not entirely, because of the increasing use of computers and smartphones, the population is more widely aware and conscious of the need to take care of their optical health.
As a result – and despite a general rise in the cost of living – spending on optical goods and services has increased in absolute terms, rising from £2.5 billion in 2008 to £2.93 billion in 2014, and with the trend predicted by the General Optical Council to continue.
Against the background of this positive economic outlook, what types of opticians are able to claim the largest market share?
The GOC says that the market in the sales of optical goods breaks down as follows:
- multiples (such as Specsavers, Boots, Vision Express, and Optical Express 2%) – currently have 64% of the market;
- independents – 29%;
- online and direct sales – 3%; and
- supermarkets – 4%.
Opportunities for independent opticians
Despite the economies of scale and heavy investment by multiple chains, independents appear to be holding their own by retaining a significant share of the market.
If yours is a firm of professional opticians, therefore, you are likely to want to play your own part in this important market sector, by keeping fully abreast of the times, the technology and the optometric apparatus currently available.
That is likely to call for your ready access to sufficient working capital or investment to buy the necessary technology and apparatus, maintain your premises in the most favourable location (if necessary, relocating), and meeting your ongoing liabilities, such as tax, VAT and professional indemnity insurance.
Unsecured fixed rate professional loans
It is to meet this kind of need for funding your practice that an unsecured fixed rate opticians loan may provide the solution.
Such a loan may take a number of forms:
- you might want to arrange a personal loan as a partner or director of your business, so that the funds may be applied to your practice as an optician;
- it may prove a useful way of funding your tax and VAT liabilities, by spreading the cost over the entire year – yet without taking on the long-term commitment of a secured loan; or
- it may be used in order to improve and develop your business, invest in new equipment or even relocate to more prestigious offices.
With an unsecured loan, there is no charge against your personal assets or those owned by your practice and you may borrow the exact amount you are likely to need – from £5,000, let’s say, all the way up to £1 million (in recognition of your professional standing and the financial health of your business).
Repayment terms are likely to be similarly flexible – from as short a period as three months or as long as five years.
With a fixed rate of interest and equal monthly repayments, management of an unsecured loan is likely to prove a boost to your cashflow.