LaToya Ferguson, owner of Sweet Psalms Florist in Conyers, Georgia, is using data from her point-of-sales system to inform her fresh flower purchases so she is only buying what sells.
Many things about Tiger Lily, a Charleston, South Carolina floral shop, have evolved from the pandemic era of business — from floral arrangements to the shop’s insurance provider. Gone are the steady flow of pandemic sales, and with it, the luxury of paying a little extra here and there for goods and services. Like many florists, Tiger Lily owner Lisa Hays Holmes is finding her new normal.
“We have seen 2023 be what we would call our ‘reality year,’” because the pandemic sales boom is over, says Holmes.
Not only did sales stemming from the pandemic dry up, but inflation, which peaked in June of 2022, is still squeezing profit margins. To stay profitable, Holmes and other business owners are re-evaluating their expenses and adjusting business strategies.
Reduce Overhead Expenses
Holmes made a major impact on her bottom line by shopping for better deals on essential monthly expenses, she says.
“I did an analysis of what things are costing me now versus than in the past few years,” she says. “I looked at business insurance first because it was astronomical. It was two and a half times what I had been paying.”
Holmes turned to her floral peer group and asked for recommendations. She found a company that offered better coverage for a premium that was 55 percent less than what she was paying, she says.
The business’s trash and recycling expenses showed an increase of 300 percent over the past several years. Holmes was able to find two other area providers who charged about one-third of the current cost.
Manage Staffing
Labor costs are one of the largest business expenses. Business owners should ensure their staff is sufficient, but not excessive, for the current market.
LaToya Ferguson, owner of Sweet Psalms Florist in Conyers, Georgia, looked to her customers’ changing habits and adjusted her staffing to meet them. Many of her customers have started picking up their orders in the store because they don’t want to pay for delivery. Fewer delivery orders meant Ferguson needed fewer delivery drivers and staff to prepare arrangements for delivery.
At Eastern Floral in Grand Rapids, Michigan, management is keeping a close eye on the schedule, and calling people off for the day or sending them home early depending on the workload, says Brenda Sterk, business analyst and production supervisor.
“We are just keeping a close eye on all areas of spending to make sure we are still profitable,” she says.
Cross-train Employees
“Don’t let one person do one thing,” says Holmes. “That will really hurt your wages.”
For example, if an employee only drives the delivery truck, but there are no deliveries scheduled for an hour or longer, the shop is paying the driver’s hourly wage with no return on the investment.
At Tiger Lily, employees are cross-trained for various duties such as working the cash register, answering phones, taking orders and making deliveries. Holmes maintains a chart that shows which duties each employee is capable of so she can make staffing adjustments quickly based on need. Because Tiger Lily has two locations, employees are scheduled to work at either shop as needed.
Adjust Shop Hours
Ferguson used to be open Monday through Friday, plus every other Sunday. She reviewed her daily sales and realized her operational hours needed to change.
“On Mondays, I don’t get a lot of calls, I don’t get a lot of walk-ins,” says Ferguson. “Mondays are just slow.”
Monday sales didn’t justify the money spent on wages and utilities. About a month ago, Ferguson adjusted her hours, closing the shop on Mondays.
Feature Flowers Differently
At Tiger Lily, the staff is asking where and how the flower arrangements will be displayed. If they’ll be against a wall, designers aren’t packing the back with blooms that no one will see.
“It looks like it’s loaded full of flowers, but it’s really a front-facing design,” says Holmes. “That’s a nice little savings right there.”
Buy What Sells
Since just after Valentine’s Day, Ferguson has seen a reduction in the average amount customers are spending on arrangements. Before the holiday, customers were spending an average of $200, she says. Her average price point now is about $120. She looked through her point-of-sales system (POS) to see what wasn’t selling and adjusted her cut flower purchases.
“I cut back on the items that aren’t selling the fastest,” says Ferguson. “I also cut back on the hard goods that I buy … based on the price point folks are buying.”
For example, Ferguson stopped buying expensive vases because her customers are spending less on average. That means she doesn’t have to spend as much every month on more expensive materials that may only end up collecting dust on her shelves.
Laurie Herrera is a contributing writer for the Society of American Florists.
