National Vision Holdings, Inc. (EYE): Business Model Canvas [11-2024 Updated]

National Vision Holdings, Inc. (EYE) has carved a niche in the eyewear industry by focusing on affordability and comprehensive eye care services. With a robust business model canvas that highlights key partnerships, innovative activities, and diverse revenue streams, EYE is positioned to cater to a wide range of customers, from value-seeking consumers to military families. Explore the intricacies of their business strategy and discover how they achieve their mission of providing high-quality eyewear solutions at competitive prices.

National Vision Holdings, Inc. (EYE) - Business Model: Key Partnerships

Collaborations with vision care professionals

National Vision Holdings, Inc. collaborates with numerous vision care professionals to enhance service delivery and customer satisfaction. These partnerships are crucial for expanding their network of optometrists, which is essential for providing comprehensive eye care services. In the nine months ended September 28, 2024, the company reported a significant increase in exam revenues, contributing $23.1 million, or 15.0%, compared to the same period in the previous year, indicating a growing demand for professional eye care services.

Partnerships with retail brands like Walmart

National Vision has established partnerships with major retail brands, including Walmart. These collaborations enable National Vision to operate in-store optical centers, significantly increasing their market reach. The impact of these partnerships is evident in the company's performance, where net product sales for the three months ended September 28, 2024, reached $363.2 million, representing a year-over-year increase driven largely by retail partnerships.

Partnership Type	Partner	Impact on Revenue	Notes
Retail Partnership	Walmart	$363.2 million (Q3 2024)	In-store optical centers enhance accessibility.
Vision Care Professionals	Independent Optometrists	$23.1 million (Exam Revenue Increase)	Increased demand for eye exams drives revenue growth.

Relationships with managed care payors

National Vision maintains strategic relationships with managed care payors to facilitate customer access to vision care services. These partnerships are vital for ensuring that customers can utilize their insurance benefits effectively. The company has reported a steady increase in customer transactions, contributing to a comparable store sales growth of 1.4% for the three months ended September 28, 2024.

Partnership Type	Partner Type	Impact on Sales	Notes
Managed Care	Insurance Providers	1.4% Growth in Comparable Store Sales	Facilitates customer access to services.

National Vision Holdings, Inc. (EYE) - Business Model: Key Activities

Retail sales of eyewear and eye exams

National Vision Holdings, Inc. generates a significant portion of its revenue from retail sales of eyewear and eye exams. For the nine months ended September 28, 2024, the total net revenue was $1,386.0 million, representing a 3.8% increase from $1,335.4 million for the same period in 2023. This growth was largely attributed to new store sales, which accounted for approximately 90% of the increase.

In the same period, net product sales comprised 80.3% of total net revenue, with a notable $26.3 million increase in net product sales, largely driven by a $18.6 million increase in eyeglass sales and a $5.5 million increase in contact lens sales. Furthermore, net sales of services and plans increased by $24.3 million, or 9.8%, primarily due to higher exam revenues, which rose by $23.1 million, or 15.0%.

New store openings and conversions

National Vision has been actively expanding its store footprint. In the nine months ended September 28, 2024, the company opened 46 new America’s Best stores and three Eyeglass World stores, while closing four America’s Best stores and one Eyeglass World store. Additionally, the company converted 20 Eyeglass World stores to America’s Best stores during the same period. Overall, the store count grew by 4.9%, from 1,173 stores as of September 30, 2023, to 1,231 stores by September 28, 2024.

The following table summarizes the store openings and conversions:

Store Type	New Openings	Conversions	Closures
America’s Best	46	20	4
Eyeglass World	3	0	1
Military	0	0	1

Marketing and promotional campaigns

Marketing efforts at National Vision are critical to driving customer awareness and sales. The company employs various promotional campaigns aimed at increasing customer traffic and boosting sales. For the three months ended September 28, 2024, total net revenue reached $451.5 million, which was a 2.9% increase from $438.8 million for the same period in 2023. Approximately 110% of this increase was attributed to new store sales, with Adjusted Comparable Store Sales Growth from continuing operations reflecting a rise of 1.4%.

The company also reported that SG&A expenses, which include marketing costs, amounted to $234.0 million for the three months ended September 28, 2024, reflecting a 2.8% increase from the previous year. This indicates a sustained investment in marketing and promotional activities to enhance brand visibility and customer engagement.

National Vision Holdings, Inc. (EYE) - Business Model: Key Resources

Retail store locations (America’s Best, Eyeglass World)

National Vision Holdings operates a total of 1,231 retail locations as of September 28, 2024. This includes 1,019 America’s Best stores and 130 Eyeglass World locations. In the nine months ended September 28, 2024, the company opened 46 new America’s Best stores and 3 Eyeglass World stores while closing 5 stores. The retail segment generated approximately $451.5 million in net revenue for the three months ended September 28, 2024, showing a 2.9% increase from the previous year.

Store Type	Number of Stores	Net Revenue (3 Months Ended Sept 28, 2024)
America’s Best	1,019	$388.8 million
Eyeglass World	130	$48.1 million
Military	53	$5.7 million

Optical laboratories and distribution centers

National Vision operates multiple optical laboratories and distribution centers that are integral to its supply chain. These facilities are essential for the production and distribution of eyewear products. The company reported a depreciation and amortization expense of $68.6 million for the nine months ended September 28, 2024, reflecting investments in technology and facility upgrades. The operational efficiency of these labs directly impacts product availability and quality, contributing to overall customer satisfaction and revenue growth.

Human resources, including trained optometrists

Human resources are a critical asset for National Vision, particularly the trained optometrists who provide eye care services. The company has invested significantly in its workforce, with SG&A expenses amounting to $705.5 million for the nine months ended September 28, 2024. The increase in personnel costs reflects a focus on enhancing service quality and customer experience. Additionally, the company has seen a 15.0% increase in exam revenues, equating to $23.1 million for the same period, indicating the value of skilled human resources in driving revenue.

Resource Type	Details	Financial Impact
Optometrists	Trained professionals providing eye exams	$23.1 million increase in exam revenue (15.0%)
SG&A Expenses	Total for nine months ended Sept 28, 2024	$705.5 million

National Vision Holdings, Inc. (EYE) - Business Model: Value Propositions

Affordable eyewear solutions for consumers

National Vision Holdings, Inc. positions itself as a leading value retailer in the eyewear market, offering affordable options to a broad customer base. The company's business model emphasizes accessibility, providing a range of eyewear products at competitive prices. For the nine months ended September 28, 2024, the company reported net product sales of $1,113.2 million, which accounted for 80.4% of total net revenue.

Comprehensive eye care services

In addition to affordable eyewear, National Vision offers comprehensive eye care services. As of September 28, 2024, the company reported net sales of services and plans totaling $272.8 million, reflecting a 9.8% increase compared to the previous year. This growth was primarily driven by an increase in eye exam revenues, which rose by $23.1 million, or 15.0%.

Service Type	Revenue (in millions)	Percentage Increase
Eye Exams	$176.1	15.0%
Product Protection Plans	$18.9	4.0%
Other Services	$77.8	5.0%

High-quality products at competitive prices

National Vision's commitment to quality is evident in its diverse product offerings, which include prescription and non-prescription eyewear, contact lenses, and related accessories. For the three months ended September 28, 2024, net product sales increased by $8.6 million, or 2.4%, compared to the same period in the previous year, driven by a notable increase in eyeglass sales. The company maintains a cost of products as a percentage of net sales at 29.3%, showcasing efficient operations that contribute to maintaining competitive pricing.

Product Type	Sales Revenue (in millions)	Percentage of Total Sales
Eyeglasses	$1,113.2	80.4%
Contact Lenses	$5.5	2.4%
Accessories	$3.9	1.0%

National Vision Holdings, Inc. (EYE) - Business Model: Customer Relationships

In-store consultations and eye exams

National Vision Holdings, Inc. offers in-store consultations and comprehensive eye exams across its network of retail locations. For the three months ended September 28, 2024, the company reported a significant increase in eye exam revenues, totaling $23.1 million, which represents a 15.0% increase from the same period in the previous year. The company operates 1,231 stores, which include America’s Best and Eyeglass World, enhancing its customer reach and service delivery.

Loyalty programs and membership clubs

The company has implemented loyalty programs, such as the America’s Best Rewards program, which incentivizes repeat purchases and customer retention. In the nine months ended September 28, 2024, net sales of services and plans, which include membership fees, increased by $24.3 million or 9.8% compared to the previous year. This growth is indicative of the effectiveness of their loyalty initiatives in driving customer engagement and repeat business.

Program Type	Revenue Impact (9 Months Ended Sept 28, 2024)	Growth Percentage
Membership Fees	$272.8 million	9.8%
Eye Exam Revenue	$23.1 million	15.0%

Customer service support through multiple channels

National Vision Holdings provides customer service support through various channels, including in-store assistance, online chat, and phone support. The company reported a total net revenue of $1,386.0 million for the nine months ended September 28, 2024, reflecting a 3.8% increase from the previous year. This growth is supported by enhanced customer service initiatives that ensure customer inquiries and issues are addressed promptly across all platforms.

Additionally, the company’s selling, general, and administrative expenses (SG&A) were $705.5 million for the nine months ended September 28, 2024, which reflects a focus on improving customer service capabilities. The integration of technology in customer interactions has also contributed to a more responsive service model, enhancing customer satisfaction and loyalty.

National Vision Holdings, Inc. (EYE) - Business Model: Channels

Physical retail stores

As of September 28, 2024, National Vision Holdings operates a total of 1,231 retail locations, which include America’s Best and Eyeglass World stores. This marks an increase from 1,173 stores at the end of the previous fiscal year. The company opened 46 new stores and converted 20 Eyeglass World locations into America’s Best stores during the nine months ended September 28, 2024.

The revenue generated from these physical retail stores is substantial. For the three months ended September 28, 2024, net revenue from America's Best reached $388.8 million, while Eyeglass World contributed $48.1 million. This reflects a growth in comparable store sales of 1.2% for America’s Best, with Eyeglass World experiencing a decline of 0.9%.

E-commerce platforms

National Vision's e-commerce segment has faced challenges, with reported lower revenues impacting overall performance. For the nine months ended September 28, 2024, e-commerce revenue was noted to decrease by approximately 10% compared to the previous year. Despite this decline, the company continues to invest in its online platforms to enhance customer experience and drive sales.

In terms of overall net revenue, the e-commerce segment remains a critical channel, contributing to the total net revenue of $1.386 billion for the nine months ended September 28, 2024, which represents a 3.8% increase from the prior year.

Omni-channel sales strategies

National Vision Holdings employs an omni-channel sales strategy that integrates both physical and online retail channels to provide a seamless customer experience. The company has focused on enhancing customer interactions across various platforms. For the three months ended September 28, 2024, the total net revenue was $451.5 million, with approximately 110% of the increase attributed to growth from new store sales.

The omni-channel approach is reflected in the company's marketing and sales strategies, which aim to leverage both in-store and online engagement. This strategy is essential to drive customer loyalty and increase transaction values, evidenced by a higher average ticket and an increase in customer transactions.

Channel Type	Store Count (as of September 28, 2024)	Revenue (3 Months Ended September 28, 2024)	Comparable Store Sales Growth
America's Best	1,019	$388.8 million	1.2%
Eyeglass World	130	$48.1 million	(0.9%)
Total Stores	1,231	$451.5 million	N/A

National Vision Holdings continues to adapt its channels to meet the evolving needs of consumers, emphasizing the importance of both physical and digital touchpoints in its overall business model. This adaptability is crucial for maintaining competitive advantage in the optical retail market.

National Vision Holdings, Inc. (EYE) - Business Model: Customer Segments

Value-seeking consumers, often lower income

National Vision Holdings, Inc. targets value-seeking consumers primarily from lower-income brackets. This segment is characterized by a demand for affordable eye care solutions, including eyeglasses and contact lenses. According to the company's financial reports, net product sales increased by $26.3 million, or 2.4%, in the nine months ended September 28, 2024, primarily due to a $18.6 million increase in eyeglass sales. The company's pricing strategy aims to attract this demographic by offering competitive pricing on essential vision care products.

Families requiring affordable eye care

Families represent a significant customer segment for National Vision, necessitating comprehensive and affordable eye care services. The company has seen a notable increase in net sales of services and plans, which rose by $24.3 million, or 9.8%, for the nine months ended September 28, 2024. This growth is largely attributed to higher exam revenues, which increased by $23.1 million, or 15.0%. The focus on family-oriented eye care solutions positions National Vision as a provider of choice for budget-conscious households seeking value in their optical needs.

Military personnel and their families

National Vision also serves military personnel and their families, providing specialized services tailored to this demographic. The company's military segment, while smaller, is integral to its overall strategy. As of September 28, 2024, National Vision operated 53 military stores, with a slight decline in comparable store sales growth of 0.7%. Despite this, the company continues to offer tailored products and services that meet the unique needs of military families, which contributes to brand loyalty within this segment.

Customer Segment	Key Characteristics	Recent Financial Performance	Store Count
Value-seeking consumers	Lower income, demand for affordable products	Net product sales up $26.3 million (2.4%)	1,231 total stores
Families	Budget-conscious, require comprehensive eye care	Net sales of services up $24.3 million (9.8%)	Includes America’s Best and Eyeglass World stores
Military personnel	Specialized services for military families	Comparable store sales growth down 0.7%	53 military stores

National Vision Holdings, Inc. (EYE) - Business Model: Cost Structure

Costs of Goods Sold (Eyewear and Services)

For the three months ended September 28, 2024, the costs applicable to revenue amounted to $189.9 million, an increase of $6.1 million or 3.3% from $183.8 million for the same period in 2023. The costs applicable to revenue as a percentage of net revenue increased to 42.1% from 41.9% year-over-year. For the nine months ended September 28, 2024, the costs applicable to revenue reached $579.1 million, up by $28.8 million or 5.2% from $550.3 million for the prior nine months. The percentage of costs applicable to revenue also increased from 41.2% to 41.8%.

Period	Costs Applicable to Revenue	Percentage of Net Revenue
3 Months Ended Sept 28, 2024	$189.9 million	42.1%
3 Months Ended Sept 30, 2023	$183.8 million	41.9%
9 Months Ended Sept 28, 2024	$579.1 million	41.8%
9 Months Ended Sept 30, 2023	$550.3 million	41.2%

Operational Expenses (Rent, Utilities, Payroll)

Selling, general and administrative (SG&A) expenses for the three months ended September 28, 2024 totaled $234.0 million, reflecting a $6.5 million increase or 2.8% from $227.5 million in the comparable period of 2023. As a percentage of net revenue, SG&A remained stable at 51.8%. For the nine months ended September 28, 2024, SG&A expenses were $705.5 million, a rise of $26.4 million or 3.9% from $679.1 million in the prior year, maintaining a percentage of net revenue at 50.9%.

Period	SG&A Expenses	Percentage of Net Revenue
3 Months Ended Sept 28, 2024	$234.0 million	51.8%
3 Months Ended Sept 30, 2023	$227.5 million	51.8%
9 Months Ended Sept 28, 2024	$705.5 million	50.9%
9 Months Ended Sept 30, 2023	$679.1 million	50.9%

Marketing and Advertising Expenditures

Marketing and advertising expenses are integral to National Vision Holdings, Inc.'s operational strategy. For the three months ended September 28, 2024, these costs were embedded within the SG&A figures, contributing to the overall operational expenses. The company has focused on increasing brand visibility and customer engagement through various channels. The total marketing spend is not explicitly detailed in the financial reports, but it is included in the operational expense overview.

Overall, the operational expenses, including marketing, reflect a strategic investment in growth and brand positioning, essential for maintaining competitive advantage in the eyewear and optometry services market.

National Vision Holdings, Inc. (EYE) - Business Model: Revenue Streams

Sales of prescription and non-prescription eyewear

For the nine months ended September 28, 2024, National Vision reported net product sales of $1,113.2 million, with eyewear sales comprising a significant portion of this revenue. Specifically, net product sales consisted of approximately 80.3% of total net revenue, reflecting a $26.3 million increase, or 2.4%, compared to the same period in the previous year. Within this segment, eyeglass sales increased by $18.6 million, or 2.2%, while contact lens sales rose by $5.5 million, or 2.4%.

Eye exam fees and service plans

Revenue from eye exams and related service plans has shown robust growth. For the nine months ended September 28, 2024, net sales of services and plans reached $272.8 million, an increase of $24.3 million, or 9.8%, from the same period in 2023. This growth was primarily driven by higher exam revenues, which increased by $23.1 million, or 15.0%.

Membership fees from eye care clubs and product protection plans

Membership fees from eye care clubs and product protection plans also contribute to National Vision's revenue streams. For the nine months ended September 28, 2024, the company recognized $95.8 million in revenue from these sources, which includes product protection plans and club memberships. This segment has been positively impacted by the timing of unearned revenue, which accounted for $4.5 million during this period.

Revenue Stream	9 Months Ended September 28, 2024 (in millions)	9 Months Ended September 30, 2023 (in millions)	Change ($ millions)	Change (%)
Net Product Sales	$1,113.2	$1,086.9	$26.3	2.4%
Net Sales of Services and Plans	$272.8	$248.5	$24.3	9.8%
Membership Fees and Protection Plans	$95.8	$94.7	$1.1	1.2%

Updated on 16 Nov 2024

Resources:

1. National Vision Holdings, Inc. (EYE) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of National Vision Holdings, Inc. (EYE)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View National Vision Holdings, Inc. (EYE)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.