GfK reports that the French optical retail market rose by 3.4 percent last year. Quoting another market research company based in Paris, I+C, the Krys Group says it increased by only 0.5 percent and indicates that it may drop by 15 percent this year due to new governmental regulations on maximum reimbursements by the public health systems.
In this context, the voluntary group claims that its affiliated retailers grew faster than the market for the first time in several years, with increases of 6.4 percent in volume and 2.3 percent in value on a comparable store basis, indicating that they made an effort to reduce their selling prices to stay competitive. It is encouraging retail members to purchase products through its central buying organizations, Codir, to maximize margins and upgrade their offerings.
Krys has also decided to go back to TV advertising, joining other French major retailers such as Alain Afflelou and Optic 2000, celebrating the 50th anniversary of the group. As previously reported, it has launched a €12 million investment program over three years to increase by 50 percent the capacity of its central lens processing laboratory by next year.
This and other investments in data processing and marketing led to a 26 percent drop in Krys' net income to about €3.0 million last year. The turnover increased to €929 million with an increase of 2.1 percent for the group's main banner, Krys. With 872 stores operating under this banner at the end of 2015, the chain had revenues of €733 million last year.
The two other chains affiliated with the group, Vision Plus and Lynx Optique, had 340 and 112 stores at the end of the year. Vision Plus, which was recently repositioned, generated sales of €124 million, 4.0 percent more than in 2014 on a comparable store basis. Sales advanced by 1.4 percent at Lynx, reaching €71 million.
At its annual meeting in Monte-Carlo, Krys' management announced a partnership with VSP, the big American health insurance company that owns Marchon Eyewear, that will allow affiliated stores to offer new services intended to enhance customer loyalty. The details will be unveiled at a later stage.
The total number of points of sales affiliated with the group increased last year by 40, leading to a total of 1,324 doors in France alone. This year, Krys wants to annex 46 more stores under its three banners.
Krys claims to have the lowest membership fees in the sector in France, averaging 2.2 percent of the retailer's turnover. To encourage more independent retailers to join the organization, the group is offer total exemption from membership fees for three years to those who make the move before Dec. 31.