Episode 045: In this interview Vonda asks Bill LaFever, owner of the Bill Doran Company, what the retail florist might expect not only for Thanksgiving and Christmas 2020, but also beyond into Valentine's Day 2021. Bill offers great insight into the logistical challenges wholesalers are experiencing to bring products to the retailer and offers sound advice on the best way to be prepared.
Learn more about Bill Doran Company
And our sponsors Flower Clique and Flower Prep School
and visit our podcast page
Sponsored by:
Flower Clique
Flower Clique Prep School
Real Life Retail Florist
Episode 045: In this interview Vonda asks Bill LaFever, owner of the Bill Doran Company, what the retail florist might expect not only for Thanksgiving and Christmas 2020, but also beyond into Valentine's Day 2021. Bill offers great insight into the logistical challenges wholesalers are experiencing to bring products to the retailer and offers sound advice on the best way to be prepared.
Learn more about Bill Doran Company
And our sponsors Flower Clique and Flower Prep School
and visit our podcast page
Sponsored by:
Flower Clique
Flower Clique Prep School
Real Life Retail Florist
Our clickers, keep telling us that we're really concerned about getting products, you know, Thanksgiving, Christmas, and even into Valentine's day. They're really feeling that there's going to be shortages. And can you kind of talk into that? Hey Lori, how are you?
Speaker 2:I'm cold because I'm in Ohio this week in Texas. So I'm here visiting my boys, my two boy children, not random boys.
Speaker 3:Okay. Well, that's good. I'm sorry that you're in the cold.
Speaker 2:I'm in the golden. I lived here for 15 years and I forgot. It's like my brain blocked out how cold it is. So we've got a great show today. I think a great podcast.
Speaker 3:They do. I'm super excited because we have bill a fever bad.
Speaker 2:Yes. Yes. Second time around.
Speaker 3:Yes. Second time. And let me tell you a little bit about bill a fever. He's the owner of the bill Doren company. He's the past president of the wholesale florist and flora supplier association and current chairman of the board of directors of the society of American florists. But I want to go back to the owner of the building company as there's been some pretty exciting growth in the company recently. And I mean, within the last six months, bill Doren company has acquired segro Ricardi in Albany, New York. Uh, motto's in Denver and Greenleaf wholesale with multiple locations. I have such respect, not only for his knowledge of the industry and his willingness to share, but also his appreciation of his team. As he knows, everyone has to work together to give the best product and the best customer service to this industry. He just wears many hats. And man, this interview was so eye-opening to me, um, about what's going on with the wholesale chain. So it was pretty cool.
Speaker 2:Yeah. So I have two little fun facts to share with you. Number one. Yes. This is, he is a return guest. Yes. We enjoyed him so much. The first time he came around, number two, you know, I like to get on and I check our episode statistics. Yes. So his is one of our top, most downloaded, listened to podcasts. Wow. He's clearly a big deal.
Speaker 3:He is a big deal. We don't have to just say that he is a big deal and we just enjoy him sharing his extreme knowledge of what's going on here in the industry and in the world. So let's give it a listen. Thanks for joining me today as our country, as well as the world is experiencing shutdowns and business challenges, most flower shops are either meeting the same sales number from the previous year or really knocking it out of the park. So many of our clickers are seeing record numbers of sales, even without big weddings and events. Could you share with us what you are seeing in the wholesale side of the business?
Speaker 4:Sure, sure. Happy to be here in the wholesale side, it's somewhat similar to what you're saying there, there's also a downside there we're really seeing wholesalers have one of two paths being very successful in having not necessarily record sales, but strong sales, a surprisingly strong sales or we're hearing and seeing in markets that other wholesalers are really going backwards, sliding faster and faster. So it's really the tale of two different paths. And we can explore those as to why, because I think there are some common threads probably with retail as well as wholesale that are causing some of that. But yeah, so either good success or you know, where they're walking through the edge of a cliff at this point.
Speaker 3:So what would be causing them to go to the edge of the cliff? Like you're just saying, let's kind of go into that because I think that is important because like you said, there are probably a lot of similarities between retail and wholesale on that
Speaker 4:The wholesalers are going more towards the, uh, the, the bad side of the situation of the P and L's are the ones that are almost doing some self fulfilling prophecies. They're bringing in less product on speculation to having their cooler at exactly a time when, uh, the retailers are working more and more out of their local wholesalers cooler. And so they have less and less product available. Um, and then because they have less product available, their sales are down. So then the next week they even bring in less product and they just really are getting the saving themselves to profitability is never going to work from that perspective, trying to cut costs and save themselves, but it's not working. You know, they're also cutting back service levels, you know, instead of, you know, if they're relevant five times a week, then they dropped it to three times a week. Now it's down to twice a week and they can justify it because the sales are down, but the sales are down also because they don't have the product and now they don't have the routes. And so they're pushing their customers to go to look elsewhere, whether it's another regional wholesaler or, or, you know, some form of a direct shipping into their marketplace.
Speaker 3:Yeah. That totally makes sense. And that's obviously what's happening at the retail level as well. If people don't have product in their store or they don't have things available, then somebody goes somewhere else as well. And we know bill that a flower shop will buy from the sales person that they are used to buying from and that they trust. Right. I mean, that's pretty well proven. And if that person can't come through farm there there's that disappointment. And then they start to look elsewhere to find another connection.
Speaker 4:Oh, for sure. And typically those retailers have a backup connection anyways, they're smart too. And so it's just that if they were 70% with somebody in 30 or somebody else, it probably slides to 30, 70, but the reverse way, and it's not like it's a major change for that retailer. It is a shift, probably more affects the wholesalers more than it does. The retailer. That level of volume just really makes a difference. Wholesale is definitely all about volume. And when those inbound trucks and outbound trucks aren't filled high capacity, then the profitability shrinks really quick. The margins obviously are so much different than wholesale and retail that we have to have volume.
Speaker 3:Right? No, that makes a lot of sense. Our clickers keep telling us that we're really concerned about getting products, you know, Thanksgiving, Christmas, and even into Valentine's day, they're really feeling that there's going to be shortages. And can you kind of talk into that?
Speaker 4:Yes, there, there are some of the production is down a lot of these related to the COVID effect in South America because the workers take buses, you know, packed buses to the farms. Um, and so that'd be very cautious on how they're getting all their employees from a rural area, you know, wide areas of rural area to just a one central farm. And then the working shoulder to shoulder in the packing houses and the greenhouses, you know, there, there's plenty of social distance in separation, but it's the packing facilities that really get tight. So there's been a lot of concern from that perspective that the government is allowing the farms to work, but there are people that are just very concerned about it. So it's been a shortage of labor for some farms. And then this goes back to the earlier part. So pandemic in April and may in June when the farm didn't know for sure what was going to happen, they really started to conserve cash. So they laid off a lot of workers. Uh, they didn't bring in all the fertilizers, the things that enhanced the flowers, they didn't necessarily invest at that level. And then they let some of their greenhouses go unintended. So they, they grew wild plants are still fine. They're typically a little under fertilized, so they're not producing as quickly as they would have. But so now they're with, with a shortage of labor and now they're not trying to get those greenhouses back into shape for Valentine's the pushes these next 10 to 14 days, they're pinching the flowers and getting prepped for Valentine's day. Um, I think, uh, Valentine's will be okay because it is such an important holiday for the, uh, for all growers, are they really rely, I mean, as much as we all wholesale and retail need a strong Valentine's day growers, especially in ruins growers need a very, very strong Valentine. So they're going all in on that, but the caveat there for Valentine's, and then we'll back up to the other, the earlier holidays, the caveat for Valentine's day is the freight out of South America. We're anticipating our freight rates to be a double what they were last year for freight. So I'm going to back up a little bit. So, you know, freight rates for the non holiday weeks have been gradually growing and then freight for Valentine's always has a premium we're outbidding people for space on the planes, and they're sending empty planes back to South America. So you've got to pay for that, that empty hall so we can get enough flowers in, you know, we're always seeing a dramatic increase in freight. So when I say a double on prey, I'm not saying a double from current rates, I'm saying the double from last year's Valentine's rate, which gets very, very significant in our world. And at this point we're signing up for that freight, but that's the only area that I could see that for Valentines that's where I would see that there could be a major issue is airlift out of Ecuador in Colombia. And so pricing it'll be based on supply and demand. Demand is not there. Then pricing won't feel as bad, but we're hearing just like what you said that the strong retail flower shops are having great sales, their business model of being able to gather the waters off different websites and then deliver the flowers is perfect for the pandemic mindset. So if there is a strong demand, the pricing will most likely go up. And then I guess the last part is if the farms have any issues getting these next 14 days, you know, they really have to pinch by, you know, mid November to get that 90 day Rose ready to be cut, packed, and shipped to the U S from Allan times. Um, if there were any outbreak at a farm that they were shut down by the government, or couldn't bring in there. Some of these farms have six, 700 workers come in by bus with, you know, 60, 70 people on a bus that the bus seats 40, and they stand in the middle of the Emily's stand and all the polls and ride like that for 45 minutes to an hour. So hopefully, you know, they're wearing the masks in the sick people. Aren't are not getting on those buses, but there is the potential for, for something bad.
Speaker 3:So then let's back up and go, okay, what about Christmas? Even Thanksgiving, we're being told, get your orders in early, ms. Everybody's expecting a really good Thanksgiving as well because of the pandemic.
Speaker 4:I would agree with you the earlier you get your orders in the better, the pricing shouldn't be outrageous by any means. There is production available for the two holidays, but it's going to disappear at the end. It will dry up. So get the orders in. Now the pricing is going to be better. The earlier they get their orders in, I would recommend whatever they're estimating would get 75% on order locked in with your preferred supplier. In my mind, I get a hundred percent, but I can't imagine not wanting to get that 75% locked in. No, you have it. If you want to play the market on that last 25%, you know, super that's a person's risk tolerance. And I get it because over the years, they've seen so many times the market tank, you know, the week before Thanksgiving and you know, the week of Christmas, you know, all of a sudden the red and white dive. So I get the mentality to want to do that, but I don't think I'm sounding alarm or saying the sky is falling by saying, get a high percentage locked in at, at a fatal price right now, because it will dry up for sure. But there, there will be enough product. It's just, I don't think the price is going to drop at the end. The price could actually go up. And so that's why I'm saying not to play the market too aggressively.
Speaker 3:[inaudible] yeah, that makes a lot of sense. Also we've heard evergreen is going to be a problem. Is that right? Have you heard that one?
Speaker 4:Our orders got cut off from our farms that we deal with. We deal with farms. And I shouldn't say because we'll see these are pickers, you know, walking through forests and stuff with permits. You know, we deal with Wisconsin in New York, North Carolina, and then, um, all throughout the Northeast, um, our cutoffs with our growers are with those suppliers cut us off earlier than normal. We typically would say somewhere about mid-October, um, that they won't accept anymore as we market, we market, you know, in August with our best pricing caught off at the end of August. So we tried to get as many orders in, and then we have another cutoff that we place home. And so we give those orders immediately to those suppliers or get them confirmed. Then we do a, towards the end of September, we have another cutoff where price would step up again, and then we give those orders. We got those confirm. Then after that, we just kind of wait to see when our suppliers cut us off this year, it was across the board. It was probably average eight to 10 days earlier than we would normally expect. Um, what we heard was that if people aren't traveling for the holidays and going to destinations and then warm weather, they're going to decorate their homes. And that were sudden surgeon in evergreen was. So I would guess that if a wholesaler or whoever was going to be supplying them, greens was waiting to place our order thinking that they could do it in early October. I would guess that maybe they could get shut out a little bit. Also. I think it goes back to relationships. If that wholesaler wasn't buying on a regular basis, uh, from some of those key suppliers, they're, weren't looking to open new accounts that's for sure. Right. You know, they, they were, they were working with us and asking for numbers in advance and trying to play in their production. Um, you know, just even just the sheer number of people, uh, kind of goes back to the same thing we talked about with some of those Rose farms. You'd just get everything bailed and together, those packing houses are pretty tight as well. Lots of people in a small area, and they were nervous about what could happen with an outbreak. But once again, there get confirmation with, with your supplier the earlier the better than I would think in our markets, you know, that our sales people really pushed hard to get them locked in. So at this point, I don't, I haven't heard of anything that anyone should be overly skid.
Speaker 3:Okay. Well, that's good to hear. That's good to hear. Yeah, right. Exactly. If the, if the order's in, you're pretty safe, but if you haven't ordered, you might try to scramble and get that done. Especially if you're doing outdoor decorating, you know, roping anything that's going to be for outdoor decorating, especially like a special accounts. You want to make sure that's in
Speaker 4:Fruit. They're also got us, you know, we have to estimate freight when we go out with our, um, with our price list for Christmas greens, because these are markets that we're not pulling out of on a regular basis. It's not like, uh, just our regular California trucks and South American trucks out of Miami and trucks out of Mexico this time of the year is all we do it. And, um, I was shocking. That freight was quite a bit higher, which I guess just talks about the economy there. Weren't a lot of available refrigerated trucks to send up into the Northeast. That's our, I'm sorry, Northwest. Right.
Speaker 3:Wow. The logistics of your job as a wholesaler has to be just crazy. I mean, that's gotta be what takes a lot of your time for, and because
Speaker 4:These suppliers also don't, it's not like they have just hundreds of thousands of square feet of storage space. So as soon as they build it up and get wreath made a mantle pieces made and Garland made, they need us to pull it. But we're also saying, wait, I want to get a full semi and okay, well, if I send the summary to, you know, Omaha, Columbus, Ohio, you know, what can we do there and how many stops? So yeah, there, there's definitely some of them. And then to try and flip that guy, then take a back, haul back to California and then get him back up there to do one more run. And then the other component that gets, you know, we have so many customers that want that product as early as possible, because they'll say, Hey, I've got to have all my decorating done before Thanksgiving. Then we want their product until, you know, December 10th, like, Oh my goodness. You know? So it was weird. We have people can't believe we're not gonna have product for them November 5th. And then we have people that say, don't, don't give me anything until after, you know, my order until December 1st. Right. There's nothing wrong with that. It's just makes our life a little more difficult because we're trying to store them. They put up a lot of ethylene. So we keep them away from flowers, you know, in some markets it's cold enough outside. We can put them in outside storage, but a lot of our markets, you know, they would dry out and not being sellable in those 30 days. So we're writing reefers and humidifiers and things like that to make that happen. All that just adds cost to the whole system. That's for sure.
Speaker 3:Oh, absolutely. Yeah. We're talking about deadlines on products. We're talking about all that going on in the wholesale world that trickles down to retail. What suggestions do you have to help shops be the most successful at this time?
Speaker 4:I think, and I say it probably all the time is just keep the relationships with their one or two key suppliers, strong, communicate a lot with them. I think when you guys do a power quick is awesome where you're, you're selling color palettes and you're selling the concept of the arrangement, not the specific three stems of those two stems to that one. STEM has to be in there like that, because as soon as you put those requirements into the pipeline, that's where we can all get in trouble because of the tightness of the supply chain right now. So I would stay flexible on the, how you feel your orders and how you take your orders, whether it's from a bride or from some type of event or from centerpieces, your flower clickers are very creative people. Um, don't let the, don't let that end consumer steer them down. It has to be something, you know, they're artists and they need to sell their artistry. And then their wholesale supplier has a cooler, full of wonderful flowers and textures and colors. You know, they can take that and then make awesome arrangements. So I would really work out of a local environment pre-order but then not lock themselves into too much on that, on the outbound, because then all of a sudden, when we get orders for, you know, 1500 Sahara roses and they need them in four days, it's like, Oh, we'll do our best. But the price just skyrocketed that's when things go awry, for sure. Right.
Speaker 3:And with the clickers, with the pre-made bouquets, those are done the farm. And so it's easy to fulfill the orders that are on their website, but what, like you're saying for special orders, when you have a wedding coming in and you ordered Sahara roses, maybe you even ordered them a month ago, your pricing probably wasn't right, because of the shipping costs, that's going to be on that. So I guess that's my warning to the retail florist is make sure you're charging for the product you're getting, because we're hearing shipping is going to be crazy and you need to be able to be profitable at this time. For sure. Anything else, bill, that you think would be helpful for our listeners to know with what's going on?
Speaker 4:I kind of alluded to before, but where I'm seeing the most fun and successes where the retailer is really stressing their creativity and customization. That's where I think that the end consumer, that loves the fact that it's a customization. You know, it's not necessarily what gets drop, shipped in a box from some of those other companies that do that to the doorsteps. And I'm not saying full customization because it just sounds like I've reversed on, on what I said about love and then consumer choose that, but adding an additional color or adding a ribbon or putting a customized card into there, all of that is huge customization that we in our industry take for granted. But, you know, to be able to add a extra ribbon or to add a more yellow than what the person was originally going to do, that's huge. And that's the creativity and the artistry that, that the retail floors can provide. And I think, you know, in any type of marketing messages and any type of that stress, the creativity and customization, and that's what I think consumers looking for.
Speaker 3:Yeah. That's a really good point because actually the number one seller on a website right now is designer's choice. So that kind of plays into that creativity and the trust they've already had with that shop. But you've given us some really great information. That's going to be super helpful for our shops for all the clickers who are listening today and really just be ready for the holiday and plan ahead. And like you're saying 70 to 75%, everybody's going to be fine and we're going to have great holidays. Right?
Speaker 4:Yeah. I really think it's going to be strong holiday for the industry. That's for sure. Okay. Great bill. Thanks so much for being with me. Thanks for having me on appreciate it.
Speaker 2:So, Vonda, first of all, you did a great job interviewing him though. When you sent me the, an edited version as I was listening, number one, I always think a podcast is great if all of a sudden it's over and you're like, wow, that was quick. Yeah, that was one for me. I know this podcast isn't for everybody, but it was very informational light that he took the time to actually explain the process all the way from, you know, everything that COVID is touching right now. Even the farms. It's not that these, the workers can't work on the farm. They can, it's actually transportation there or it's the clothes. So that was kind of eye opening for me. This is obvious for a lot of people, but I didn't really think about it. Um, Laurie,
Speaker 3:I don't think it is obvious for people. I think that in the flower shop, we're getting flowers in from the wholesaler and the wholesaler is getting the flowers from the farm. And the wholesaler probably has a little bit better picture of that, but I don't think people understand that, okay, let's all get on a bus and let's go out to the farms and work or work side by side packing things together. It's a real sacrifice that those workers are making at a farm.
Speaker 2:Yes, yes. I agree. And the companies that are actually providing the bus scene and doing all the things and, and now with COVID realizing that's not a safe and healthy environment to be on a little bus that probably doesn't have air conditioning. Maybe it does, maybe it doesn't, but you know, so they have to stop all of those things for safety. And then he also brought up, some are fearful. Maybe they live at home with their parents or, you know, elderly people. So I don't know. I just appreciated that he painted that visual in my head of the whole, the bigger picture, because there are times a lot of us are only focused on what's on our little screen. Right. We don't see big picture. So I appreciated that. I also loved, I felt affirmation when he was saying what he would say to flower shop owners right now is focus on your own customization and your own creativity. That is what they're noticing people want, because like, wow, that's exactly how we feel here. Flowered click seeing you mentioned the design of the day or the designer's choice is right now, the number one seller and people should take advantage of that, because that means if I'm ordering that, I'm trusting you. I already have trust in you where I wouldn't order it. I just, I want you to be creative. I want you to just send the best of your creation to my mom or my sister or whoever. So I love that.
Speaker 3:Yeah. And that's, again, when he was kind of talking about shopping by color and arrangements of different color choices, and that's really why we created flower click because you're not counting and going, okay, there's this many of this flower, there's this of this flower, it's that overall look and the creativity and the combination of those things are really making a difference for shops. Yeah. The other thing that I really appreciated was him giving the advice of, be sure you order 70% of your product, you know, making sure that you're setting yourself up for success for the holiday. I think that was huge. And it was very encouraging for me to hear it's going to be a good holiday. He really, he really didn't have any qualms about no, I be careful. No, I don't think that was even an issue.
Speaker 2:Right. I think most every shop owner I've spoken with just knowing from February to now how crazy busy they've been. I don't think they see an end in sight, which is wonderful and horrible. Right? So I think most everyone believes it's going to be really busy. But I did like that. He said a lot of shops tend to like gamble for the last minute for ordering. If you're going to do that, at least pre-order 70, 75%. If you want to gamble 25, that's fine. But I liked that he kind of gave those odds again, because people that are constantly asking, should I, should I not, should I do it differently? He's a pretty good authority on this. He knows. So anyway, I appreciated it. I thought it was all really good. Um, Vonda, the one question and I'm, I'm going to give you a pass this time because I know he was literally like had another meeting on a whole,
Speaker 3:I know I will have to. I did blow that.
Speaker 2:It's okay. It's all right. I forgive you. I just like, we, we want to give the wholesalers a little grace and they'll go. If they get the form, I'm going to give you some, okay. Well thank you. Yes. Next time. So maybe he can text us what his favorite thing was. So what is giving you life right now?
Speaker 3:Do you really want me to tell you, you and it shares some really fun information. I'm getting a puppy Getting a little puppy and that's giving me life. I'm like doing all this planning. It's like, Oh, just like a little baby coming. We're adopting a rescue dog. And it's just the puppy though. He's at nine weeks old.
Speaker 2:Oh my God.
Speaker 3:Check back with me next week. And we'll see how happy I am.
Speaker 2:Well, I will to be giggling a lot because I know, you know this cause you've had puppies before, but you know, the one thing is good thing. They're cute. God made them cute for a reason. Yes, they do their little accidents or two up shoes. You're like, Oh, but Alicia cute. So I love that.
Speaker 3:So what is giving you life, Laurie?
Speaker 2:Well, I think it's just spinning here. You know, my husband, he's funny. I've not even been here more than a few days. He's already texted me about changing my flight to come home from London because he's bored. He's having to take care of Bo. I mean to take care of my rescue dog Bo. So I'm, I'm here for the week and I am just loving every minute of it. I have reorganized their kitchen already. And I was like, are you guys, if you don't like, you can put it back. And they're like, and I don't care. So, you know, they're easy. They don't, I have gone to TJ max and brought them things I think they need. And so it's fun. It's, it's, I'm, I'm enjoying every minute. I haven't seen my oldest son since Christmas, like publicly seen him because of COVID yeah. Joy that is giving so much. I'm like, I get that. And he's like, okay, stop. I love it. All right. Well, Hey, we will talk later. Okay. Thanks, Larry. We have certainly enjoyed our time together today and we look forward to being with you guys again, if you have any questions, concerns, comments, anything we would love to hear from you. You can always email Laurie at flower, click.com. Also, if you enjoy our little podcast, go ahead and click that subscribe button. That's very helpful for us. And you can even leave a review and we hope you join us next week. Yes. So please come back and join us and discover how a bit of knowledge and one small change in your mindset can take you to new levels in your life.
Speaker 1:[inaudible].