Mister Optik, a regional low-cost optical retail chain based in the Tuscan city of Lucca, is accelerating the development of its network of stores to cover not only the domestic market in but possibly also Italy, France, Spain, Greece and the U.K.
Last year, Mister Optik sold five stores ? located in the Treviso, Padua , Milan, Pescara and Piacenza ? for an undisclosed sum to Salmoiraghi & Viganò, reducing its presence largely to the regions of Tuscany and Emilia-Romagna. But in the meantime, the company launched a franchising program and starting reopening directly-operated stores (DOS) thanks to the proceeds of the sale, a capital increase and the company's own cash generation. In Jan. 2009, it appointed Chiara Del Tessandoro as sales director and started advertising on national television in September of this year.
The Italian Mister Optik network currently totals 42 DOS and nine franchisees but still remains largely focused on Tuscany and Emilia-Romagna. The retailer claims to sell more than 2,000 models of sunglasses and prescription frames, including leading brands such as Ray Ban, Carrera, Prada, Persol, Versace, Gucci and Emporio Armani. The group also has its own brand of sunglasses, frames and contact lenses, called Mister Optik, which represents about 40 percent of sales.
It buys both current and close-out models from wholesalers, which the company says enables it to be free to apply the prices it wishes and to be on average 30 percent cheaper than the competition. The only license-holder it works with directly is the firm Moa Ottica, which produces eyewear for the Italian brand Baci&Abbracci.
Mister Optik is currently rolling out an automated self-service dispenser outside its stores selling contact lens solutions, readers and various accessories for glasses, as well as parapharmaceutical products and condoms.
The machine will be available 24 hours a day, but its purpose is to boost sales outside working hours. During the day, the products will be sold at the same price as in the store, but a 10 percent discount will be applied between 10.00pm and 6.00am. The service, called Miss Pharma, was going to be supported by an ad hoc advertising campaign on Mediaset's three national channels from mid-December, when the machines were scheduled to be installed outside all stores.
Following its participation in a franchising show held on Oct. 23-26 in Milan, Mister Optik hopes to more than double the size of its network, expanding in other parts of Italy. It signed final contracts to open six stores in central and northern Italy by the end of March 2010 and underwrote a preliminary contract to open another store. It also entered talks with the owner of 14 shopping centers situated in the north-east of the country to open six stores in their premises. The group also hired a consultant to scout for possible franchisees in southern Italy and four potential partners have been identified in Puglia and Calabria.
Mister Optik's franchising format is a store of 100-150 square meters located in highly patronized areas accessible by car. The possible opening of stores in malls is an exception in the group's development strategy.
The minimum investment for a 100 sqm. store is €120,000, including an entry fee of €25,000. The company pledges to reimburse the investment if sales objectives are not reached. Franchisees can also pay supplies six months after delivery and part of unsold products are bought back at purchase prices after 12 months, according to Mister Optik's chief executive, Matteo Sorrentino. He describes the group's national advertising campaign as the chain's «pride and joy.»
According its business plan, Mister Optik forecast 2009 sales reaching €9.0 million, largely thanks to the development of the network, compared with €7.5 million in 2008. Italian revenues are seen rising to €11.5 million in 2010 and €15.0 million in 2011. This target plan is based on a network of 70 stores in Italy, 50 DOS and 20 in franchising. Currently, the average size of the group's DOS is around 150 square metres but the average floor space is expected to increase as the group focuses on opening stores of about 300 sqm. in Rome, Naples, Turin and Milan. Each major city is due to have at least five DOS, Sorrentino highlighted.
The forecasts do not take into account the chain's expected development in foreign markets. Sorrentino estimates that international expansion could add 30-40 percent in revenues. By 2011, Mister Optik aims to have DOS in Barcelona, London, Paris and Athens. Sorrentino says that a 300-sqm. flagship store in a city like Barcelona could generate an annual turnover of about €2 million.
The choice of Barcelona to penetrate the Spanish market is partly due to Mister Optik's working relationship with the lens and frame manufacturer Indo, which has its headquarters in the city. Sorrentino sees Indo as a strategic partner for Mister Optik.