For the past 15 years, we’ve seen one example after another of big companies merging with or acquiring their competitors.
The list of major M&A’s is long and it continues to grow. The latest deal was announced last month, when Essilor said it plans to acquire a 50 percent stake in Shamir.
Independents—practitioners, retailers and labs—have good reason to be concerned about the impact of M&A’s, because they alter the balance of power in the industry and thus are inherently political. The formation of new alliances between former competitors or between manufacturers and distributors is often perceived as a threat by independents who tend to see themselves as helpless bystanders in a power game played by big corporations. Each new deal is accompanied by hand wringing and worried choruses of “Who will be next?” and “When will it all end?”
Yet despite the effects of consolidation, independents have remained a vital force. In fact, the latest data from the Vision Council’s VisionWatch survey shows that despite a 3 percent decrease in overall industry sales during the 12-months ending June, 2010 versus a year ago, sales by independent eye care practitioners were up 1.5 percent, and Rx lens sales were up 2.5 percent. That, in turn, had a beneficial effect on independent wholesale labs. According to Vision Monday’s 2010 Top Labs Report, the Top 25 Independent Labs grew their Rx sales by 3.4 percent this year.
The era of mega-deals is winding down, as desirable acquisition targets become fewer. Due to their resourcefulness and resilience, independents have not only survived but many have even thrived. There is every reason to believe they will continue to do so.