 Roll Up Your Sleeves, and Stay Alive
Thirteen tips for enduring the challenges of today’s retail floral marketplace.
by Brian J. McCarthy
I have been pontificating to my 375 employees for the last four years that we are in “survival” mode, not “success” mode. One will lead to the other when market conditions and consumer confidence return, but for now, it’s “roll up your sleeves, and stay alive.” Here are my top strategies for surviving in today’s market.
 1. control expenses
I advise you to strongly emphasize cost containment in your business. Profits are generated by increasing sales, decreasing expenses or, preferably, both. And expenses are definitely something you can control.
Cost containment has always been the axis of the McCarthy Group. Here are a few examples.
• You will never find a postage meter or a leased piece of office equipment in any of our stores.
• You will never see garbage pickup more than once a week, and in some cases once every two weeks.
• You will rarely find a full-size van in our parking lots.
• You will not see company-paid cell phones with many employees.
• You will not find overtime except during the weeks prior to Valentine’s Day and Mother’s Day.
• We pay employees biweekly—never weekly—by the least expensive provider in the country.
• We never pay a bill late thereby avoiding interest or finance charges.
• We negotiate with banks to never pay banking fees—no charges for checks, deposit tickets, number of checks cleared, change for our registers, money wire fees—nothing. Local banks are more aggressive than ever before; they, too, are in “survival” mode. They want our business, and they want our employees cashing their paychecks there as well.
 2. manage credit card use
Managing credit card usage strategically is crucial to survival. First, get personal credit cards in your own name—rather than business credit cards—to use for your business expenses. Business credit cards often have restrictions that personal credit cards don’t, and they generally don’t offer the same protections for the cardholder. An example is that it can be very difficult or even impossible to dispute and back off charges made on business credit cards.
Second, pay as many bills as possible with credit cards; however, be sure you can always pay your balance in full so that you never have to pay interest. This process can really aid cash flow.
Take newspaper advertising, for example. If you run ads in August on your house-account bill, pay that bill with a credit card that starts its cycle on Sept. 28. You’ll receive that credit card statement around Oct. 24, and you’ll probably have until Nov. 15 to pay it. This buys you 47 days of float for free and saves you from writing a check to the newspaper.
I believe that it costs $3 every time you write a check, whether it be for $5 or $5,000, including time, posting, envelope, stamp and reconciling. By paying all the bills we can with a credit card, we estimate that we save some 1,000 checks monthly, or $3,000.
Additionally, some credit card companies provide airline points or gift points as an incentive to use their cards. We accumulate enough mileage to almost never pay for travel to the 13 states in which we own flower shops. Last year, we estimate we got $75,000 worth of free travel.
Finally, never use a debit card. They give you nothing, the money comes out immediately, and you lose the free float and the points.
To read Brian's 11 other tips, check out our January issue.
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