2004 retail florist of the year

Leaders at Swenson & Silacci Flowers, a progressive three-store floral business in California, utilize smart strategies to overcome obstacles, earning them this coveted award for 2004.

by Shelley Urban

In life, there are but a few factors over which we truly have control. In the floral business, there are, perhaps, even fewer. So successful shop owners work hard to control what they
can and find ways to overcome that which
they cannot.

Mark Silacci (pictured below right), president of Swenson & Silacci Flowers, knows this all too well. Headquartered in Salinas, Calif., a state where fuel prices are well above the national average and workers’ compensation is, to use Mark’s word, “disgusting,” some of his business’ most costly expenditures are beyond his control.

But rather than wasting his energy worrying about the uncontrollables, Mark focuses, instead, on factors over which he can have some influence—efficient operations, strong leadership, effective advertising and promotions, employee retention, and more—which enable his three stores to remain in control of their markets.

Recently, the Swenson & Silacci team’s efforts were recognized by the Wholesale Florist & Florist Supplier Association (WF&FSA) and Florists’ Review, who together sponsor the Retail Florist of the Year contest. As the national 2004 winner and recipient of the $1,000 cash prize provided by Syndicate Sales, Inc., this creative business, a runner-up in last year’s competition (see FR, August 2003), shares how they succeed.

strong and growing
Ed Silacci, AIFD, who serves as chairman of the board for Swenson & Silacci Flowers, started his floral career making deliveries for Walter and Bessie Swenson, who established Swenson’s Flowers in 1945. In 1966, Ed became a partner, and “Silacci” was added to the name. When the Swensons retired, Ed became the sole proprietor.

From his earliest days at Swenson’s Flowers, Ed worked hard to make it the florist of choice in Salinas, and, as the owner, worked even harder. Over time, he built the shop into a $1 million business.

In 1993, Mark, who made a career in advertising before earning his MBA, joined his dad at Swenson & Silacci Flowers. Within a few years, the pair decided to take their first big step together and open a second location in nearby Monterey. Although it was a gamble, they’d been making eight to 10 deliveries there every day, and the shop’s name was becoming well known in the picturesque coastal community.

Shortly thereafter, they opened a third location in North Salinas and, in 2002, acquired an already successful shop, Ferrari Flowers, in Capitola. They also moved their main Salinas headquarters into an impressive 10,000-square-foot showroom, complete with central computer and phone systems for all the stores and a design center that serves the Salinas and Monterey shops.

This past year, Ed and Mark opted to sell the North Salinas shop, which, according to Mark, was only “holding its own”—not losing money but not showing strong profits either. In 2003, the remaining three stores managed to yield slightly more than the $3.7 million that the four stores had earned the previous year.

gallery showrooms
With two designers on staff who have been inducted into the American Institute of Floral Designers (AIFD) and numerous other talented designers in the shops, beautiful florals are a hallmark of Swenson & Silacci Flowers, and sales of fresh flowers account for about 70 percent of revenues.

Each year, the shop does more than 150 weddings, which contribute about 8 percent of total sales. Most are sold through the Monterey store, where the tourist trade is significant.

Another of the shop’s popular offerings are the “Blooming Bunches,” which are attractively priced bouquets that are assembled in-house for cash-and-carry sales. Prices for the seasonal selections start at just $5.95 and go up to $50. Despite the fact that the bunches, both monobotanical and mixed, are only a small amount of total fresh flower sales, Mark says that point-of-sale numbers are up 25 percent to 30 percent in Salinas, and the bunches may be partly responsible for the increased walk-in traffic.

When visitors enter the shops, they are greeted by a fabulous array of gifts, home accessories, permanent plants and arrangements, and live green and blooming plants, all displayed in impressive showrooms with spacious aisles that make the stores seem more like galleries than flower shops. Merchandise is displayed on high-end antique fixtures, which are also for sale and priced as high as $3,500. Antiques sales account for 3 percent of annual revenues.

efficiencies help control costs
Even when business is thriving, controlling costs is critical to profitability, but some costs can be difficult to manage. One example of a major non-negotiable expense is gasoline. At more than $2 per gallon in some regions, including California, where prices are said to be among the highest in the nation, fuel costs are making delivery an increasingly expensive service. But since Mark and Ed can’t do anything about rising fuel prices, they’re considering increasing the shop’s local $6.95 delivery fee.

However, as Ed points out, there’s a limit to what customers will pay. So, for now, he and Mark are focusing on managing that over which they have control—efficiency. And when it comes to deliveries, efficiencies can prove to be significant time and money savers.

“We use routing software to better manage the 125 deliveries we have, on average, every day,” Mark explains. “It’s definitely helping us save money by limiting the number of trips to each zone.” He also notes that the software has incorporated additional checkpoints in the system, so mistakes are much more likely to be caught before they become profit-reducing problems.

Despite the need for efficiency, customer service is of primary importance, so same-day delivery is still offered for orders placed before 3 p.m. to areas considered “local” to each store. If the central design center has already made its deliveries to a particular area, the local shop will fill and deliver the orders.

systems controls are necessary
While fuel prices and other issues, such as exorbitant workers’ compensation rates—Mark says it equates to about 10 percent to 12 percent of his payroll annually, or about $100,000 per year—are out of his hands, Mark takes a “hands-on” approach to running the business, which, he says, is essential in a multiple-store chain, especially when one store is about a 40-minute drive from the main shop.

To avoid an abundance of headaches and to keep business running smoothly, Mark and Ed have implemented a number of controls to coordinate efforts. “We had to build an infrastructure, which led to more forms and systems,” Ed recalls, “because everything had to be structured, so there were no gray areas.” A key component in the infrastructure is the shop’s computer system, which links all three stores.

Linked computers also facilitate communication, which Mark and Ed say is critical for success. In addition, Mark makes personal contact with management at each store at least twice daily, and he visits the shops several times each week.

“We’re not big on weekly meetings, but regular communication is extremely important,” Ed notes, “and the impetus is on the main store to keep in touch with the remote sites and coordinate efforts.” These tasks often fall to Sunshine Reyes, the manager in Salinas, who ensures that product at the remote locations is always in stock and that the staff are informed.

The two managers at the remote sites, Erik Croonquist in Monterey and Amy Clark at Ferrari Flowers in Capitola, are also strong leaders who, according to Mark, don’t need much “hand holding,” and that makes his job easier. “Good managers are a must,” Mark stresses. “We have great managers, as well as great staff, at all our locations, and I don’t have to worry or wonder how any of them are doing.”

benefits help control turnover
Keeping employees for the long term is another key component in having a worry-free workplace. At Swenson & Silacci, a generous benefits package has had a tremendous impact on retention; the average tenure is an impressive seven years. Many, however, stay longer. The manager at the Monterey store has been with the company for more than 10 years, and buyer/designer Ewald Delzeit, who’s also Mark’s mentor, has been with the company for 20 years.

“Although the cost of our medical plan increased 30 percent last year and 25 percent each of the previous years, we still provide full benefits because they are important, and we believe in them,” assures Ed.

In addition to medical, dental, vision, and life insurance coverage, employees also receive 100 hours of personal time each year, which is a recent change to the company’s benefits package. “Until this year, we had given 10 days of vacation time and five days of sick, and the sick time had to be used within the year, or it was forfeited,” Mark relates. “Although they’re getting a few less hours each year, employees like the personal time better because they can use it however they need, and they can accrue up to 200 hours in their accounts, and they will never lose that time.”

limit budgets where possible
With his training and experience in advertising, Mark was the logical choice to handle Swenson & Silacci’s marketing programs, which he did for 10 years. Yet developing marketing plans, creating materials, and planning and buying advertising can be very time consuming, and Mark felt his time could be better utilized. So a year ago, the company hired Lisa Silva, then a recent college graduate, to serve as the marketing coordinator.

Under her guidance, the shop has begun to concentrate on coordinated product-driven campaigns that promote specific items rather than “institutional” ads that only promote the shops and their services. For example, the shop’s Blooming Bunches are often featured in the various media, which include radio, newspaper, and some television along with direct mail, e-mail and Internet ads, and delivery tag-alongs.

While these types of advertising help to increase in-store traffic and phone sales, Ms. Silva has also created business-to-business sales binders for funeral directors and hotels and catering companies. The binders feature beautiful photography of the shop’s work along with pricing information. For the funeral directors, for example, items can be sold in coordinating packages, such as a casket spray, a basket, and an easel piece, and a range of prices is included for each package.

Because the binders make the funeral directors’ jobs easier, they are more likely to suggest Swenson & Silacci to bereaved families. “We’re getting better orders from them, too,” Mark adds, “because the packages encourage sales of multiple pieces.” In fact, funerals now account for 10 percent to 15 percent of fresh flower sales.

With Ms. Silva on board, Swenson & Silacci increased its 2004 advertising budget slightly over the previous year—from 4 percent of annual revenues to 5 percent. “This is one expenditure that we work hard to control, since there are so many other factors that we can’t control,” Mark reports. Despite the challenges, Ed and Mark continue to do whatever it takes to ensure that their business thrives. Through efficiencies, excellent leadership, well-planned promotions, employee retention, and more, the pair’s smart strategies continue to enable them to be in command of their markets. ¤

Moore than you’d imagine
When the folks at G.E. Moore Flower Company, Inc. in Watsonville, Calif., nominated Swenson & Silacci Flowers for the “Retail Florist of the Year” 2004 award, they believed there was a good chance their pick would do well. “We knew that they had been a runner-up before, and we were proud to nominate them,” says Ginger Moore, sales manager. “I knew they were capable of winning.” “They’re just the greatest people,” says Winston Moore, owner and president. “They take an active role in helping us to be better wholesalers,” he says. “Their buyer, Ewald Delzeit, comes in each morning and hand picks their flowers for the day. He’s an expert, along with being a great mentor, customer, and friend,” says Mrs. Moore. “They support the community, and they’re just good people. They’ve helped us help them.” G.E. Moore Flower Company was started in 1992 by Mr. and Mrs. Moore. It supplies less than 15 local businesses, of which Swenson & Silacci Flowers is the largest. The company was started mainly as a drop-shipping business and specializes in hard-to-find varieties.

For information on entering the 2005 “Retail Florist of the Year” contest, visit www.wffsa.org, or contact your favorite wholesaler. Also, check out www.floristsreview.com during the next four months for this story and others on 2004’s three runners-up.

thanks to all
Florists’ Review would like to congratulate the three runners- up in the 2004 “Retail Florist of the Year” contest:

Beneva Flowers & Gifts, Sarasota, Fla.;
Bouquets, Denver, Colo.; and
Grassi’s Flowers & Gifts, Tacoma, Wash.

We’d also like to thank the following shops who competed: Ashland Florist, Lexington, Ky.; Blooming Orchid Florist, Houma, La.; Designs of the Times Florist, Melbourne, Fla.; Dr. Delphinium Designs, Dallas, Texas; FloraScape, Springfield, Ill.; The Flower Shoppe, Pratt, Kan.; Flower Studio, St. John’s, Newfoundland, Canada; Lake Forest Flowers, Lake Forest, Ill.; Maplehurst Florist, Essex Junction, Vt.; Maud Baker Florist, Decatur, Ga.; Papillion Flower Patch, Papillion, Neb.; The Posey Patch, Laramie, Wyo.; The Posie Peddler, Saratoga Springs, N.Y.; Stem Gallery, Lincoln, Neb.

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