jueves, 6 de junio de 2013

Florist Business Methods, THE TRUE. Part I

Background

First, we should give some background about Florist Business sector; the local florist is a brick and mortar business generally owned by one or more individuals who live in or near to their community, the florist raises or sell flowers and ornamental plants plus other complementary services. The florist can be privately owned or can be established as a corporation. A local florist employs professional designers, managers, sales staff, assistants and delivery people, who also generally live and work in their community. There are some famous florist chains and many other individual florists across the country; most florists are family owned and operated and all aspects of the business are supervised closely by the owner or manager which could mean a good quality service.
local florist fulfills and delivers any order made by a client. The florist can receive an order via a retail consumer that walks in, phones in or receive the orders which are placed through the florist’s E-Commerce website, a wire service or an order gathered. The florist designs and creates flower arrangements, ordered by the client, and delivers it to the intended recipients. The local florist provides valuable services, and friendly advice about flowers. The local florist is very valuable because he is familiar with the local hospitals, businesses, nursing homes, funeral homes, and the streets in the communities where the local florist is located. Florists, answer questions, solve problems and deliver the service that a client wants and needs when ordering floral arrangements.

After more than 90 years of delivering flowers and floral arrangements to different cities and towns other than the sender’s city, the direct transaction and operation between the florists, have not developed and evolved to an efficient and effective business service for them; instead, an alternative was created; where an intermediary actor worked as a bridge between the Originating Florist (OF) and the fulfilling florist (FF). This alternative is commonly known as a Wire Service who gets a commission and profit for their services.

Almost all florists (brick and mortar florist, and pure online florist) are members of a wire service company. Being a member of a florists' wire service company allows a local florist to send and receive orders across the nation while receiving a commission. If a customer wanted to send flowers to a relative on the other side of the nation, they usually had to go to their local flower shop to have this done. The local originating flower shop would then send the order to a delivering filling florist, and both florists would receive a commission for the order. This has helped the growth of the florist industry.

As aforementioned earlier, for more than 90 years, wire services have been membership organizations where a retail florist in one area can contact a member florist in another area and transmit flower orders for his customers. The largest wire services are FTD Inc., Teleflora and BloomNet®.
Wiring flower orders from one city to another has grown into an industry of millions of dollars; but membership to a florist wire service network has not been free for a local florist; In addition to the regular cost and expenses (payroll, rent, leasing, internet etc) of the brick and mortar florist store, the national wire services also collect substantial fees from florists for a wide range of services such as Monthly Membership, Monthly E-Commerce Site Hosting and Admin, Monthly Network Access/Usage Fees, a monthly portion of Semi-Annual Dues, Monthly Toll Free Listing Fees, Monthly Network Quality Fees, Monthly Florist Directory Listings Fees, Monthly 4 extra City  Listings Fees, Monthly 4 Zip Codes Listings Fees, system upgrades. Also there are variable costs associated with a membership in a wire service,  costs such as Cost of incoming E-Commerce orders, cost per order, handling fee/charge, relay fee/charge, merchandise from the wire service or services they may belong to, etc.

When the internet grew in popularity, pure online flower companies, started to use the wire service as a method to efficiently, collect many orders and send them to brick and mortar florist across the nation. Currently, due to the high competition and the high profit margins that can be earned by simply gathering orders and passing them onto a wire service, more and more unscrupulous marketing firms are popping up using deceiving marketing methods like fictitious websites where the consumer is fooled into thinking that they are dealing with a real local brick and mortar florist, only to learn the hard way when their order doesn't get delivered or what they ordered is not what the recipient receives, that’s when they realize,  they have been dealing with someone who probably does not know the difference between a rose and a carnation and is not a florist at all (customer order filling representative).

Now the Order gathers is another link added to the chain. They do not have big cost of installations inventories equipment, multiple branches and locations, etc.  They gather information from their home or office, from where they   fulfill representatives take and prepare orders, that’s it. They forward the client order to a wire service or to a local retail florist for fulfillment. For their part, the Order Gathers (OG) retain a significant portion of the money that a customer paid for the flowers, leaving the local florist with little ability to operate his business in a profitable manner.  On the other hand, the wire services had started to compete against order gathers and their  direct members, brick and mortar florist stores since 2003; the wire services created a sophisticated website, flowers clubs and institutional services that attract customers to their sites, those clients that otherwise should go to local florist. These real sceneries are against the local florist, plus high fees and cost of wire services, the aforementioned situation, among others factors, helped to create a declining margin of profits for local brick and mortar florist.


On the fallowing posts, we are going to see different Florist Business Methods:

A. Traditional wire service method.
B.  Alternative Wire Service method.
C. Order Gather (OG) using wire services.
D. Order Gather (OG) using filling florist.
E. Wire Service Order Gather (WSOG).
F. Direct Shipping.
G. Direct Florist to Florist.
H. Direct order.
I. Marketplace.

Go to part 2,  Florist Business Methods, THE TRUE. Part2




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