To offer consumers the lower prices they seek while maintaining your
profitability, you’ll likely have to reduce business expenses. Here are
my ideas for lowering your payroll.
by Kenneth R. Royer, AAF
Like many small-business people, florists who work side by
side with their employees every day become almost like a family. In such
a situation, it’s often difficult to take unpleasant action when it
becomes necessary. Also, properly training people in this business is
stressful and time consuming, and many florists avoid it whenever
possible. As a result of these factors, I believe many florists have not
made changes in their staffing or their methods of operation and are
planning to maintain their current staffing and operating procedures
until things improve.
it will never be 2007
I believe that maintaining the status quo, hoping for
improvement, is a mistake. Florists are losing market share, and that
loss will continue to grow unless the value equation is changed in the
minds of consumers. Even then, it is unrealistic to expect to return to
the inflation-adjusted sales volumes of past years.
However, I am not totally pessimistic. I believe there will
be opportunities to grow and prosper for florists who respond properly
to the current circumstances.
There are various reasons for florists’ loss of market share.
Some of it is the Internet and the more satisfactory ways it enables
consumers to order arrangements and other gift options. Some of it has
to do with market changes involving order gatherers and wire
services—changes that were out of the florists’ control.
A major cause of diminishing market share, however, is that
consumers have become educated about flower prices and have concluded
that florists are expensive. Now, consumers are searching for better
value. Unfortunately, florists are already barely profitable—if at
all—so reducing prices is out of the question unless, somehow, costs can
labor costs now
Approximately one-third of florists’ expenses are labor
costs. Because of the gravity of the situation, I encourage every
florist to immediately reduce his or her labor costs by 10 percent to 15
percent, or more, if he or she has not done so very recently. The
reduction should coincide with the level of sales declines being
experienced. Here are a couple of suggestions for doing so.
Selectively reduce hours rather than laying off or discharging
employees. Keep your staff intact, if you can. Most employees
can handle a reduction of a few hours a day or a half day a week.
Some may even enjoy it. Ask them before you take action, and make
sure the most valuable employees are given first priority.
Think carefully about the time period for hours reductions.
Some times of the day are very busy, usually from 10 a.m. to 2 p.m.
During other times of the day, the pace is usually slower. If that
is the case in your business, a reduction in staff during the slow
periods would increase productivity. Schedule workers when they are
needed rather than attempting to maintain a traditional 8-to-5
I have always believed in
Parkinson’s Law, which states: “Work expands so as to fill the time
available for its completion.” In other words, if you reduce your
staffing wisely, it will have the effect of raising your staff’s
Parkinson’s Law also works in reverse and has probably already been
at work in florist shops. As units sold have declined, the work
force subconsciously has slowed its pace to make the work last for
the entire work period.
change work procedures
Profoundly revising the work procedures is the next step, and
doing so can further reduce a florist’s need for costly labor. The most
needed revision is in the way arrangements are made. Some floral
arrangements need to be different and unique, but uniqueness is not
really important to most customers, and it is very time consuming. Begin
making multiples of prepared-in-advance sample floral arrangements. Here
are some suggested steps.
Each week, a floral
designer should create several sample arrangements in the most
popular price points. That designer then is free to concentrate on
floral arrangements that need to be custom made.
arranger, who is less skilled and less costly than a designer,
should then make the anticipated number of the sample arrangements
that could be sold in the next few days. When made in a group, the
copies of sample arrangements can be created with a 50 percent time
savings and with less costly workers.
Sell the featured (sample/recipe/standardized) arrangements.
Offer them, suggest them, describe them. Be proactive. This is where
the process often bogs down. Most floral salespeople are not
accustomed to suggesting specific arrangements to customers, and
some incentives, such as a commission or award for every featured
arrangement sold, should be provided.
I hope that every florist in operation today is using a
computer with direct order entry. I am amazed by how much time
computerization has saved in our business. Here are a few functions that
relate to labor savings.
Automated outgoing wire orders and incoming orders that print
out on the user’s order forms
Printing of all the cards and tags
Delivery management: manifests, routing and confirmation
Monthly financial statements
create a web site
Every florist needs a Web site for many reasons, but here I
want to address the amazing labor savings that can be derived from Web
sites. An increasing number of orders is being placed on the Internet,
and, essentially, customers are filling out their own order forms. The
orders arrive and are printed out in the store, requiring no time of the
Unfortunately, most Web sites present consumers with hundreds
of options, making every Internet order a wasteful, time-consuming
custom order. This is not efficient. The principle of “less is more”
applies here. In this case, it means that fewer choices and more
concentration of orders result in increased efficiency. I will address
this further in a future article on marketing.
At this time, 20 percent of sales in Royer’s stores arrive
over the Internet, and they are 30 percent of the sales that previously
were placed on the phone. It is a major change in store efficiency.
A helter-skelter delivery system, without any structure or
timetables, is inefficient. For the most part, deliveries can be
directed into defined areas, with designated timetables.
Drivers should be part-time and scheduled to arrive for work
at the times their routes are planned to depart. Special deliveries can
be done for additional charges, but be sure the fees you charge reflect
pay for productivity
Many workers believe that they are paid an hourly rate to “be
there.” It is important that you make them understand that, as employees
of your business, they are there to contribute to the profitability of
Many florists have found simple ways to help their staff
understand that principle. They talk to their employees about
productivity, and they praise the most productive ones. Most
importantly, they show their appreciation by giving productivity rewards
for designers, salespeople and drivers.
the owner/manager role
The flower business is hard work. In the current situation,
absentee owners probably will not be successful. It is a hands-on
business and requires a 100 percent commitment from the owner/manager to
be involved in the everyday operation, unless the business generates
more than $1 million in sales.
Everyday operation means the owner/manager will often be at a
design table or sales counter. There is no stronger motivation for
employees to pick up the pace and improve productivity than an
owner/manager who is setting the pace, leading the way and setting an
Kenneth R. Royer, AAF, is
a lifetime florist who expanded the business started by his mother in
1937 into what is now, arguably, the largest traditional florist
business in the United States—U.S. Retail Flowers, Inc.—which is
operated today by his three sons.
Throughout his career, Mr. Royer has served the industry in numerous
ways—holding positions with the Society of American Florists (SAF), the
American Floral Marketing Council (AFMC) and the American Floral
Endowment (AFE); conducting seminars; writing articles; and authoring a
book, Retailing Flowers Profitably.
Mr. Royer also is the recipient of many awards, including SAF’s Golden
Bouquet Award (now named the Paul Ecke Jr. Award) and lifetime
achievement awards from FTD and Teleflora.