Recently, Mingyue Lens submitted a prospectus to the China Securities Regulatory Commission in preparation for listing. The eyewear industry has always been called”extraordinary profits”, which seems to be confirmed in the prospectus of Mingyue Lens. The average cost of lenses is only 6.23 yuan. So what is the production cost of a pair of glasses?

1

Danyang, Jiangsu:A pair of lenses costs 10 yuan for a spectacle frame is 30 yuan

Danyang, Jiangsu Province, has always been known as the capital of glasses. It produces more than 400 million pairs of lenses, accounting for more than 70%of the country’s total output. It is the world’s largest lens production base and the largest domestic eyewear trading center.

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At present, the common eyeglass lenses on the market are mainly divided into PC lenses and resin lenses according to their materials. Due to the high light transmittance and refractive index of resin lenses, in daily life, consumers buy more resin lenses. Common lenses mainly have four types of refractive index:1.56, 1.60, 1.67, and 1.74. The person in charge of the factory told reporters that the higher the refractive index of the lens, the thinner the edge of the lens under the same power.

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Tang Haoyu, Chairman of Jiangsu Tianrun Optical Lens Co., Ltd.:Generally, the refractive index of ordinary lenses is relatively low. The lenses of the same power will be thicker. The high-end lens materials are more expensive, and the lenses made are more beautiful. Thin and lighter. The cost of factory production is around RMB 10 to RMB 50 per pair.

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The reporter learned in the spectacle frame manufacturer that a pair of spectacles usually accounts for 60%of the cost of spectacle frames, and the raw materials used in spectacle frames are mainly divided into plastic sheets and metal. The cost of a pair of spectacle frames that all use plastic sheets is only 20 yuan.

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Guo Wenyan, Director of Sales Department of Jiangsu Yuchang Optical Glasses Company:The price of a pair of frames is basically 30 to 80 yuan. 80 yuan, may belong to the pure titanium type, not a common metal, its material, manual polishing wages, electroplating costs and other costs will be expensive.

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The reporter learned that most of Danyang’s eyeglass frame companies are currently OEMs for domestic and foreign eyewear brands, and the output of self-operated brands is small. This is mainly because the competition in the eyewear industry is fierce. Self-operated brand promotion costs are too high and it is difficult to promote. At present, the net profit margin of glasses frame manufacturers is generally around 12%.

2

Supplier needs training

The net profit margin of eyeglass distributors is 8%

The lowest price of lenses is only 10 yuan, The lowest price of the glasses frame is only 30 yuan. Based on this calculation, the ex-factory price of a pair of glasses in Danyang is only 40 yuan. Compared with foreign brands, what is the difference in quality of such glasses? Why do we need one or two hundred yuan to wear such a pair of glasses every day?

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In the interview, the reporter learned that most of the glasses currently on the market come from Danyang, Jiangsu. Since the lenses are strictly inspected when leaving the factory, there is little difference between domestic and imported lenses in terms of quality.

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Although the powers of eyeglass lenses used by each person are not the same, the factory generally pre-produces lenses covering all powers and sells them to distributors, and the customized lenses only account for less than 10%of the total output. The downstream eyewear shops generally order from dealers.

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The dealer told the reporter that most of the purchased lenses will be sold to downstream optical shops at an average price of about 30 yuan. Compared with the ex-factory price of more than ten yuan, although it seems that the profit is higher, Sales pressure is not small. In addition to the cost of purchasing lenses and spectacle frames, dealers also need to provide training services to the spectacle shop, responsible for the return of shop lenses and replacement of damaged products. The profit is not high. Currently, the net profit margin in the industry is generally maintained at around 8%.

3

The high rent of the store leads to the high price of glasses

The net profit margin of retail stores is less than 10%

The average price of dealers A pair of lenses is sold to downstream optical shops at a price of more than 30 yuan. The cost of a pair of glasses is not more than 100 yuan, including the frames. Why does it take hundreds or even thousands of yuan to equip a pair of glasses in daily life? Where did the profits go?

Cai Li runs a shop in the glasses city in Danyang, Jiangsu. He told reporters that in Danyang, the average price of a pair of glasses ranges from 100 yuan to 200 yuan, and the minimum price is even 69 yuan. glasses.

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Cai Li, a merchant in Danyang Glasses City, Jiangsu:We have been here for more than ten years, and the operation and control are relatively healthy. Normally, the annual operating cost is about 500,000 to 600,000.

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Cai Li told reporters that the biggest cost of operating an optical shop is labor and rent, which together account for 90%. For a 60-square-meter shop like him, the annual rent is more than 200,000 yuan. Calculated by cost, daily sales need to reach 1,600 yuan or more to protect the capital.

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The reporter looked through Dianping and found that the average price of glasses shops in Shanghai ranges from several hundred yuan. For shops in prosperous areas such as People’s Square and Nanjing Road, the average price of glasses is generally higher than 1,000 yuan. Industry insiders told reporters that, except for brand factors, the production costs of most glasses are not much different. The main reason for the large difference in selling prices between Shanghai and Danyang glasses is the huge gap in shop rents.

Because consumers have a long time to replace glasses, most of the glasses shops do not have much business, and shops can only sell by means of high customer unit prices.

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The same is true for Doctor Glasses, the only listed glasses company in A shares, with a gross profit margin of 71.17%in 2019, which means that the cost of glasses is only less than 30%of the selling price. But after accounting for store rent and labor, the company’s net profit margin is only 9.5%. If the net profit is divided evenly among 397 stores, it means that the net profit of each store is only 157,000 yuan a year.

Guo Wenyan, Director of Sales Department of Jiangsu Yuchang Optical Glasses Company:Various expenses such as operation, personnel, and rent account for a relatively large amount. From an intuitive point of view, in a shopping mall in a big city, opening a small-scale optical shop, at least two pairs a day, may not lose money, but now from the perspective of the general environment, you can sell more than two pairs There are still few stores.

Source:CCTV Finance