Independent Labs in India crucial for last mile servicing and way ahead
Eyewear Consultant & Hon Advisor & Chair Advisory Committee, India Vision Institute
While lot has been spoken on the market opportunities in India optical market, the silent contributor in this journey has been the independently owned laboratories processing Rx lenses. The journey over the decade has been a roller coaster in terms of profitability for the labs and their working capital needs. The labs in India work on very efficient cost mechanism at the operating level but there are major challenges in front of them for them to fund the growth.
Upgradation of labs to digital surfacing & coatings involves high capital investments. While many have brought in investments in this category there are still numerable labs that follow the conventional processing some having multi coating plant and many with hard coatings. The labs are the nerve center especially for service to Tier 2 cities and beyond wherein the last mile connectivity and relationship with the opticians plays a big role and these labs manage it well. On the one hand we in India have a long way to go to cast the lenses as majority of the semi-finished are imported into the country, the Rx processing infrastructure is in place to manage the current demands in the middle category of the market pyramid. Progressive lenses consumption is on the rise due to new consumers getting into this category and the bifocals market also is growing at single digit as a replacement market. Compounded by the Indian population longevity of life going up, the consumption of spectacle lenses in the replacement market is also being seeing the positive evolution accordingly. With the market expected to grow year on year and historically had demonstrated that the growth of MSME has been close to double that of GDP of the country, there needs a recognition of the efforts made by these entrepreneurs. Also need for an organization or an association of independently owned manufacturers of spectacle lens is the need of the hour to address and highlight and represent to the Govt from their standpoint to boost consumption. The independent labs are ably supported by the equipment manufacturers in India over a decade now and the servicing and spares for the equipment’s are well handled given that there are reasonably sized labs in the country. There are many pockets in India which has potential to grow and early bird investors into these regions will benefit in mid- term.
Another interesting aspect is that most of the independent labs have their own B2B brands and some having invested in to smoke screen brand building with consumers. Given the constraints due to scale, having said that the lab brands have made inroads into the smaller towns without fanfares.
The independent labs would be playing a strong role to contribute to the Indian spectacle wearers over the next decade. However, in order it is done efficiently, there is a need for coming together and coming up with innovative mechanism like for instance common coating centers for efficient deployment of capital while maintaining their management and ownership control and their business and be competitive.