your business for future success
Two actions you must take if you want to regain lost sales of cut
flowers and increase sales in the months and years ahead.
by Kenneth R. Royer, AAF
After conducting many seminars for florist groups and consulting with
many individual florists, it has become my view that what florists want
to sell and what consumers want to buy are at odds with one another.
It begins with shop owners who enter the retail flower business with
unrealistic and sometimes romanticized views of the business. Many get
into the business because they have artistic inclinations and believe
they can express them in flower arranging. Those beliefs are often
supported by design schools and industry media that concentrate
primarily on floral arrangements. Those influences guide many florists
to position their businesses to focus primarily on unique, individually
created floral arrangements, which appeal mostly to upscale customers.
In doing so, those florists position themselves as less affordable and,
thus, less appealing to middle-income customers.
a missed opportunity
Because of their focus on arrangements, many florists have shown little
interest in selling unarranged flowers. For the majority of consumers,
however, floral design takes a backseat to the flowers themselves, and
they will willingly make their social expressions with unarranged
The emergence of ProFlowers’ e-commerce business model is evidence of
that. ProFlowers displays flowers in vases on its Web site (www.proflowers.com),
but the company actually sells unarranged flowers in a box, often
accompanied by a vase, and ships them overnight by FedEx. There is no
semblance of a professional florist’s touch. The company does, however,
provide attractive, good-quality unarranged flowers. Its growth since
its launch in 1998 has been astonishing. The evidence is undeniable,
proving that a large number of customers are satisfied with unarranged
repositioning on arrangements
I believe there are two measures that need to be taken to stop the
decline in florists’ arrangement sales. The first is to create lower
price points. The second is to improve access and simplify purchasing.
1. LOWERING PRICE POINTS More florists need to target middle-income
consumers who have been switching to flower vendors offering more
affordable prices. The comfortable $20 to $40 price points of those
middle-income consumers may not support the unique, individually created
arrangements many florists offer. And, in all likelihood, those types of
arrangements are not what those consumers are looking for. After all,
that group is not accustomed to custom-designed clothing, custom-made
automobiles or even custom greeting cards. In today’s world, there is
very little that most people can afford that is custom made.
Florists do not need to reduce prices on their artful, top-of-the-line
arrangements. They can continue to make those types of arrangements, but
they also need to provide arrangements at price points between $20 and
$40. And they must find ways to do it profitably.
One solution is reducing cost of goods sold. Following are two
suggestions for doing that.
• Arrangement content In order to provide lower price points profitably,
florists must reduce arrangement costs. They need to focus their
purchasing on what is profitable rather than on flowers that are
personally appealing or new or exotic. For example, high-markup flowers
might be carnations or spray mums (pompons), which often are priced at
four or five times their cost. ‘Stargazer’ lilies or Anthuriums, on the
other hand, are examples of low-markup flowers, which are often priced
at only two or three times their cost.
It is important, of course, to include new, interesting flowers in
arrangements, but the ratio of those low-markup “prestige” flowers to
the high-markup “basic” flowers needs to be managed. The goal is to
simultaneously achieve the “right look” and profitability. Neither needs
to be sacrificed for the other, but it is important that a high
percentage of the most profitable flowers be included in every
• Wholesale purchasing To obtain wholesale flowers at lower prices, many
retail florists need to be more creative in their buying. There is an
oversupply of flowers in the world at this time, but most retail
florists do not benefit from it because they work out of their
wholesalers’ refrigerators, buying only what they need for a single day
or even for a single order. Wholesalers will not provide retailers with
the best prices if they purchase that way.
It is important to understand that there are no set prices in wholesale
flower businesses. What you pay will be determined by your salesperson,
who is rewarded for making profitable sales. They will not offer lower
prices if they know that those lower prices will not result in increases
in quantities purchased. The fact is that, because of overall declining
sales volumes and high service expectations, wholesalers’ margins have
increased from 20 percent years ago to the current 40 percent to 50
Florists can get lower prices, however. Here’s how. First, always ask
the price. Secondly, purchase a disproportionate amount of one kind of
flower. It should be as much as a half box or a full box, even if that
seems like more than can be used in the following four or five days. The
challenge, of course, will be to put that “buy of the week” to use
before the end of the week, or it will be wasted.
Here are three ways to do that:
1. Use as much as possible of the special buy in all “recipe”
2. Use the special buy in every custom arrangement as much as is
3. Offer a weekly special of the special buy in small unarranged
bunches. Each bunch should
• contain a minimum of three or four of the special-buy flowers.
• be priced at less than $4.
• be offered every week, hopefully with a different flower each week and
at the same price
• be promoted creatively.
Unfortunately, if a large percentage of a florist’s sales are incoming
wire orders for custom arrangements, the strategy outlined above is not
as useful. Today, profitability almost demands that incoming wire orders
be limited to 15 percent of total sales.
UNARRANGED FLOWERS The other substantial change in
positioning on arrangements is for florists to adjust their thinking
about small sales. Dutch florists have long understood that, in order to
survive, they must sell unarranged flowers in addition to arrangements.
They create large, accessible displays containing a hundred or more of
each kind—and sometimes each color—of flower. Customers select
individual flowers from those mass displays.
Many Dutch florists do not have back-room refrigerators, where flowers
are stored out of sight of customers. In contrast, most American
florists, unfortunately, have a high percentage of their flowers in a
workroom refrigerator, where they are hidden from potential buyers.
In my early years, I, too, was guilty of discouraging customers who came
into the store for a few fresh flowers. In many cases, they were people
with European accents who were not interested in the arrangements in our
display refrigerator. Instead, they preferred to see what was in our
back-room refrigerator. We regarded that as a disturbance and an
annoyance at that time instead of a source of substantial additional
• Repositioning yourself Later, my attitude toward unarranged flower
sales changed drastically, largely due to some experiments on weekend
specials conducted decades ago by Dr. Peter Pfahl, of The Pennsylvania
State University, in State College, Pa. The experiments proved it is
possible to sell loose flowers at special cash-and-carry prices without
detracting from sales of flowers at regular prices.
Soon after the results were published, we started selling weekend
specials. We were amazed at the large numbers of people we attracted
with small 1-inch ads in the newspaper and how our store traffic and
sales growth in all categories accelerated.
Something was happening to our image. Consumers began to perceive us as
an affordable florist and one that was willing to sell flowers without
arranging them and that was happy to make small sales. We repositioned
ourselves in consumers’ minds. Over the years, we have worked to
maintain that positioning.
• Pricing Before seeing the light, we, like other florists at that time,
marked up flower prices to include the cost of arrangement and delivery.
Those who did not want the flowers arranged or delivered paid for it
anyway because it was part of the markup. It is a policy that is very
damaging to florists.
After much observation of bucket shops and street vendors that provide
no service at all, I believe a 2.5-times markup on flowers is adequate.
In other words, a flower purchased at wholesale for 20 cents should be
sold for 50 cents.
It is damaging to the image of florists when consumers see Alstroemerias
priced at 70 cents a stem in a grocery store floral department and at
$1.50 or more in a flower shop. It reinforces the belief that florists
are expensive, which is very detrimental in today’s marketplace.
growth is essential
To survive in the future, I believe florists will need to have at least
$320,000 in sales (the average sales volume of florists with payrolls in
2007, reported by the U.S. Census Bureau). The fixed costs of running a
store at a desirable location can hardly be covered with less than that
amount of sales. Florists will also need to generate more local sales
and reduce the number of incoming wire orders, on which they make little
or no profit.
The florist of the future needs to be perceived as affordable,
knowledgeable, creative and dependable, and the flower shop of the
future must be a place where consumers can buy flowers easily, in every
possible form and at reasonable prices.
Florists will have to place more emphasis on the flowers themselves, and
they’ll have to produce arrangements more efficiently, so they can be
priced more affordably.
For more information on this subject, access Mr. Royer’s book, Retailing
Flowers Profitably, at www.usretailflowers.com. Click on “About Us,” and
then click on the book icon.
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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.