What's Next? What Should the Floral Industry Expect Going Forward?

Episode 136: Vonda spend the past weekend in Phoenix, AZ joining many talented designers at the Arizona State Floral Association Convention as they celebrated 70 years. She was there representing Teleflora with a main stage program "What's Next: We've come a long way, but what should be expect going forward?" In the podcast today she shares some of her message.

Sponsors:
Flower Clique
Flower Clique Prep Schools

Sponsored by:
Flower Clique
Flower Clique Prep School
Real Life Retail Florist

Transcript

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We know another way that history repeats itself, which is not as much fun, right? And that is in the form of a recession. Welcome to the business and pleasure of flowers. We're your hosts, Fonda LaFever and Lori Wilson.

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And we believe that business and fun are a perfect combination. Kinda like us, Fonda.

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Hey clickers, it's good to be here with you today. Boy, I'm telling you, it is a busy weekend. And Lori and Ellie are down in Miami at the Society of American Florists NextGen Conference, which they're speaking at, and have a booth set up for Flower Click. So they have a busy weekend ahead of them. And I'm in Phoenix, Arizona at the Arizona State Floral Convention. And we've spent the day prepping for the day tomorrow. So we have a full day packed with all kinds of great stuff. Boy, what a wonderful group of people and hardworking, dedicated, and they have put together a program for tomorrow that is like no other. So I'm super excited to be part of that. And what I wanted to just talk about is what my program is going to be covering because I think it's really information that's helpful for everyone. Done a lot of research on it. Gosh, did Lori's thing, did the research on it, so that I really could give valuable information to everyone attending the conference. So since this is airing afterwards, I thought it would be great to just share this information too. The Arizona State Association is celebrating 70 years as an association, which is remarkable. And so they're covering a lot of the history of what the floral industry has gone through in the last 70 years. So my program, which is the anchor program of the day, is called What's Next, right? So it's we've come a long way, no doubt. But the blooming question is what should we expect going forward? You know, I do wish I had a crystal ball and I could tell you exactly what the future holds, but we don't know for sure, but we do know there are some indicators that can help us predict what's going on in the future. So I just wanted to share a little bit of that information today, and uh we'll go from there. As you know, when I present, and and this program is actually sponsored by Teleflora because I'm a Teleflora education specialist. So during the program, um, I'm going to be doing a lot of designing, which is related totally to what I'm presenting on. So the information has designs which go with it. So the first thing we're going to really talk about is where we were that many years ago in floral. And although I am not 70 years old, I started in 1975 when there was chicken wire and clear vase designs, styrofoam, those type of design techniques, which interesting enough, we've returned to the chicken wire, which is now florist netting or poultry netting. You know, give it a different name, different spin. As we know, history repeats itself. You know, we kind of are going to do some designs with different techniques, uh, different armatures that are helping designers these days to make the designs easily, some with foam, some without foam. So, you know, from colors to fabrics to design trends, we see the patterns, we see the repeat, we see again history repeating itself. But when we look at history and we see what's coming now, we know another way that history repeats itself, which is not as much fun, right? And that is in the form of a recession. Since 1948, there have been 11 recessions, and the pattern is they average one every six to seven years. So I wonder if how many of our listeners here today have been through what they are calling the Great Recession, which boy, do I remember December of 2007 to June of 2009. So it was the longest running recession since World War II. And as I'm here at Arizona State, I'm talking to a lot of shop owners who obviously made it through that. They're like, oh yeah, that was a tough year, but you know what? We did some changes, we did some pivots, we um kind of found a niche or niche, however you want to say it, and we kind of ran with that. So we're gonna talk a little bit about that. But the most important thing is anybody who has been through that gained survival skills, right? Survival skills. The growth right now is slowing, but you know what you need to do. I think that's the key. Just last week I listened in on a webinar with economic market experts, including Dr. Ben Bernanke, who was the former chair of the Federal Reserve, and he's now a senior advisor for PIMCO, and Jurian Timmer, who's with Fidelity Investments, and they were really talking about what is to come, right? What's happening with the inflation? How is this economic cycle happening and what's going on? And one interesting thing, which I'm sure you're all aware of, is that the economic cycles are getting shorter, right? And more exaggerated. For instance, we had a short recession in 2020, which was caused by the pandemic or the shutdown. And we had a super strong recovery in 2021, and now a lot of places are finding a rapid slowdown in 2022. So we know that's happening, and we don't want to get into any politics, but that's kind of what happens. The politics play into how the recovery's going. So we're just everybody's watching that very closely. But what's interesting when you really research what is going on in a recession for the floral industry, and this is actually according to uh smartasset.com, and it's asking, are flower shops recession proof? Which is very interesting, right? Even in lean years, florists don't suffer too badly, is what it's saying. And if we think of what we have just gone through with a pandemic, and at this point, many of you are feeling like there's finally a summer again, which you haven't had for a couple years. But let's go back to that. Florists don't suffer, sometimes they thrive during times like that. And it's kind of going back and asking, okay, what was happening in the 2007 to 2009? And what this report was telling us was that FTD reported sales numbers dipped only about 5% from the beginning of the 2007 recession, and through 2008 didn't see any further drops, which is good news. They attribute that to the fact that flowers serve as a symbol of good cheer. Like we didn't know that. And as we also know that sometimes it's out of obligations for loved ones at holidays that people send flowers, Valentine's Day, Mother's Day, maybe Thanksgiving, Christmas, so certain holidays, obviously, birthdays, anniversaries. So that's what keeps the flower shops somewhat recession proof, which is good news. But when you look at everything, there's some things that just stay the same. Success equals attitude, strength, and perseverance, right? It's all about the attitude getting it through it and making the adjustments that are necessary to get through this. So I think one of the biggest challenges that everybody's feeling right now is that the cost of goods sold has jumped, right? Yeah, minimum wage as well. So there's rising wholesale prices and as well as you're having to pay your staff, if you can find them, a little bit more. So the whole idea, and what you have to realize, and you know very well, is that you just have to work smarter. You have to be totally in charge of your cost of goods sold. You have to control what you can control, right? As you know, I talk about all the time, you need to price out the flowers and don't count on somebody else to price out what you have priced on your website, what you have priced in your store. Oh no, we've always sold it for that price. You can't do that. You have to be able to be proactive and know what it is you're selling and what you have to sell it for. Now, I do think many of you during the pandemic found a niche, which is what I talked about a minute ago. And what is that? Was it plants, weddings and events, sympathies? Did you specialize in making personalized memorials, tributes? It's something that the customers can't get anywhere else. What is that that you have found that your customers come to you for? And maybe it's just every day, and which is just great. Identify that niche and continue to market that. As we dip into somewhat of a recession, which is what they predicted, you want to be able to continue to serve your customers well and for them to continue to come to you for those special things. Another thing that's important to note is that there really is a spiritual response to any financial crisis. This was a study that was written for a presentation in March of 2009 called Hope, Prayer, and the Economic Crisis. And it was given at the Greek Orthodox Church of the Annunciation in New York. It was very interesting to read through this study and say, wow, that really does make sense. You know, a lot of it was talking about history, of course. And the four points coming out of this were one, generations before us always hear, your generation is spoiled. I wonder if you could really survive an economic crisis. I wonder if your generation could survive a real economic crisis. Now, isn't that funny? We're saying that now. We said that during the pandemic, said that in 2007, 2009. People were saying that, you know, during the depression. And so it's interesting how everybody's perception is, ooh, I don't know if anybody could survive that. So that was one. Number two in this study was family members are drawn closer together as they're forced to rely on each other and to care for one another. Sometimes it's physical, where the grandparents and grandchildren are living under one roof, which adds new dimension to old relationship. But family members are drawn closer together during an economic crisis. Sometimes it's because financially they need to help one another. Other times it's a spiritual or an emotional connection that needs to be made and helped people through those situations. You have the support and love and caring of family members, which I think that's great. Um, number three was we're reminded of the importance of coming together to address our problems. We as individuals must rise to the occasion in big ways and small in our families and in our communities. So I think that was really cool too, right? So those three, but the fourth one was financial leaders showed that what matters most in the long run and what defines a human being ultimately is what one chooses to learn and how one chooses to behave in a time of crisis. So it's not always what they're doing, but how they're doing it and with the compassion that they're offering that. That's what the leaders in the past have been known for. It wasn't, okay, well, I put this policy in place, I put that policy in place. No, it's, oh, I cared about people, and this is the response to that. So those were the four biggest points in this study on spiritual response to a financial crisis. So knowing that, that families are coming together, that there is a growth in spirituality at that time, which might kind of lend you to what type of gifts you need to be offering in your store, or listening when you're on the phone and making an offering based on that spiritual response that could be happening in your area. The other thing I want you to look at is what we talked about last week on the podcast with Lori and Cammy, and that was now and later. Again, what can you do now to prepare and offer to your customers so that they and you both can get through this little bit of an economic turndown if we seem to have one? And it's that pivot that you did before. Customers, consumers are looking to do something to make themselves happy again. Flowers definitely do that. What can you do now with your customers, with consumers, to bring them into your store, to bond with them more? And one of those things is really offering services, offering something for themselves or others, and that would be maybe the classes, bring it back in. I know many of you were doing that. We were having our shop talk last week, and there was that was one of the questions. Hey, I've been doing classes, I need some fresh new ideas. And so our Flower Click members were exchanging ideas of things that they had done in classes, which were really great to hear. Some of the ideas were, you know, make it look easy, and maybe it's not as easy, but you can help them through that or offer different levels so that somebody who's a beginner has never taken a class before, um, have them come with somebody who has, or you have a beginner level, you have an intermediate level, and you have somebody who's been to many of your classes. So that was one thing that I think was really important. Somebody else talked about have upgrades to the containers that they use. Another person I thought was great. It's like bring in your own container, and then they could pick out the flowers that they want to use, and they had it set up so that you know you get three flowers out of this area, you get five foliage from this certain area, and so that the person taking the class had a lot of flexibility. I just thought that was a great idea. But the whole idea is, you know, give them something they can do, make themselves feel better by taking flowers home and make them feel like, oh my gosh, I'm really treating myself as something special. So as we transition into this time of uncertainty, is what some people are calling it, I just want to say there is finally a summer, but that doesn't mean that this is an economic turndown, right? We're feeling like, oh my gosh, take a deep breath. But most of the predictions that we're seeing for the floral industry is we're going back to the normal cycle, right? It's summer, it's a little slower. Although if you're in weddings and events, man, they're booming. They're saying that this is the busiest wedding season in the last 40 years, and that's what's reported by the knot. So that's not a bad thing, right? So if you're in that niche, good for you. You know, you've got a lot going for you there. So I like to refer to this as a retreat. It's because you're finally getting that little bit of a break in the summertime that you have had for many years, and so don't panic. It's coming back. You just need to give yourself that breathing room and say, hey, it's okay, and really key in on what your core business is about, and that's about offering flowers, offering services, and making money. So it's so important for you to be aware of your cost of goods sold and make the proper markups. Just because the costs are going up doesn't mean you are supposed to eat those increases, right? You need to be able to continue to maintain a profitable, strong business. If you have any questions on what you need to do, go back and refer to some of our podcasts, which talk about profitability and how cost of goods sold need to be a certain number, your payroll needs to be a certain number, and your facilities. So those are the really controlling factors of what's running your business. The other niche that I think a lot of you have taken advantage of is that of being plant parents. It's selling the plants in the store, having containers available to drop the plants into. And although I know many of you for a while were having a hard time getting the plants, I think it's back. They're just priced higher than what you normally had them. So take the time to look at the plants, see if maybe expanding that, putting that on your website, advertising on your social media, and talk about being plant parents. And that's a trend that continues or a niche for many people that is uh continues to stay strong. As we wrap it up today, my suggestions would be this is just your normal summer, which you haven't had for a long time. And I just want you to take advantage of that and breathe. Just breathe and just be ready. You know, just watch everything very closely as you're coming into the fall season, which, gosh, is only a month away, and design smarter, right? Make sure you're controlling your cost of goods sold, find your niche and pivot if necessary. You know, if it's worked before and it's not working now, you might need to make another pivot. Be a plant parent, right? Offer that for your customers. Remember, there's going to be another return to spirituality or family bonding. Maybe I shouldn't say a return to a continuance because families are going to continue to feel like it's important to get together, whether virtually or physically, which is happening at this point, as you can tell when you're out on an airplane traveling places. And remember to believe in yourself. You've been through the typical cycle of a flower shop many times before. You haven't experienced that in the last two years because you've been running 100 miles an hour. So just take a minute and breathe. Continue to be innovative and shift where necessary, but it's that little bit of summer that you're experiencing and it's going to be picking up soon, and you're going to go, whew, that was a nice little breather. Let's move on. And next week I'll be back with Lori and we'll be doing a wrap-up of what happened at the NextGen conference that's happening right now down in Miami. So her and Ellie had a great presentation today. So I'm looking forward to hearing about where NextGen is moving and the excitement that that's bringing to our industry. We'll look forward to it.

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