Surveyed members of the ProVision membership group have earned, on average, an income of AUD$821k for the financial year ended 2011.
According to figures released by Resurg, an independent benchmarking and performance management company that specialises in multi-location businesses, net profit after owners’ notional salary and before tax was AUD$129k. This represents an average of 15.7 per cent against sales.
The Eye Talk Survey of 276 independent optometry practices released in September 2012 revealed that net profit for owners after all salaries and costs in the same period was 5.2 per cent of revenue of AUD$373,649. For the end of the financial year to 2012, optometrists that contributed to the Eye Talk Survey nominated their net profit was 3.1 per cent of revenue (approx AUD$10,000).
Sean Johns, one of the founding partners at Resurg, said the figures from ProVision
should be treated with a degree of caution because the salary assigned, although a realistic six-digit figure, was ‘notional’. However he said the figures compare well with other multi-location businesses that sell both stock and service / skills.
Our role is to look at the hard data..
“I see the level of profitability in a mixed level business like this as reasonable. The Group would be comfortable with the knowledge that most members surveyed said they had a trending up in growth.”
Mr. Johns said the 120 ProVision members surveyed made up a statistically sound number.
“This is the first time we’ve benchmarked ProVision’s performance. We’re waiting on figures for the 2012 financial year to be released, which will enable us to measure the change in performance year on year.”
In the meantime, Resurg will work with ProVision members over the next year to further improve performance.
“Our role is to look at the hard data and find out what the best in the industry are doing, then fill in the gaps with education and ongoing assistance through small performance groups.
“Benchmarking is an important part of this process because it enables comparison of performance against other businesses, or previous years.
“ProVision members have an enormous amount of collective knowledge to share. By establishing structured performance groups with a process in place, they can do this effectively. As ProVision becomes bigger, and as its total turnover increases in size, it has the ability to attract larger businesses as suppliers. This will, in turn, help members to increase their net profit,” he said.