Frame Inventory Bookkeeping for Optometry Practices

Frames Are Stock, Not an Expense

It's common for optometry practices to expense frame purchases the moment they're bought, rather than recording them as inventory. The result is a balance sheet that never reflects what's actually sitting on display, and a cost of goods sold figure that bears little relationship to what's actually been sold.

What Proper Inventory Tracking Looks Like

Frames purchased for resale should sit as stock on the balance sheet until sold, at which point the cost moves to cost of goods sold. Xero's inventory feature, or a connected practice management system, can handle this automatically if it's set up correctly from the start.

Lens-Only Jobs Need Separate Cost Tracking

Not every sale involves a frame, lens-only replacement jobs still carry a lab cost that's a direct cost of that specific sale, not general overhead. This needs its own tracking line so margin on lens-only work can be assessed accurately.

Two Systems, One Truth

Many practices run a practice management system for stock alongside Xero for accounting, without the two actually talking to each other. Over time the figures drift apart, and neither system can be trusted on its own. Regular reconciliation between the two, or proper integration, is essential.

What This Means for Margin Visibility

Without accurate inventory tracking, it's almost impossible to know your true margin on frames versus lenses versus contact lens subscriptions. Fixing the bookkeeping is often the first step toward understanding where the practice actually makes money.