Essilor

2. How did these trends affect industry growth?

Demographics :

* Younger adults : Nearsightedness

* Ageing population : Farsightedness (Presbyopia)

Both of these combined lead to an increase in the demand for eyeglasses and, therefore, a growth in the optical industry.

Retailing :

* The increase in retail outlets for optical products can inversely impact on the lens manufacturer.

Geographic locations :

* Most of the consumers of optical products are from developed countries, with high GDP per capita. However, growth rate is stagnant in these particular countries

* Developed countries have more growth potential than developing countries. However, due to limited access to eye care, this can limit the growth of the optical industry.

Substitute products :

* The lens manufacturers can be negatively impacted by growing availability and acceptability of vision correction alternatives to lenses, such as eye laser surgery and contact lenses.

Replacement markets

* With the considerable decrease in the demand for replacement services, due to recession, the growth of the industry is likely to be negatively impacted.

Insurance programs

* The probable discontinuation of reimbursement for prescription lenses will have a negative effect on the growth of the industry.

Question 3

In order to sustain strong financial performance, what options did Essilor have?

Growth through acquisitions

The company has been expanding its business through strategic acquisitions over the years.

- The company signed six new partnerships in the US, Canada and Brazil in January 2014.

- Majority share acquisition in Frame Displays (designs, manufactures and distributes display furnitures and accessories for optical stores.

- Acquisition of coastal.com, online vision care retailer : strengthens its online presence.

Strong portfolio of brands

Essilor conducts business in every category of lenses under various globally recognized brands....