A look at the pros and cons of each business model, as well as your lifestyle and personal goals, will help you determine if changing to an alternative mode of business is right for you.
According to Wikipedia, the difference between a “studio” and a “shop” is that a studio is an artist’s workshop while a shop is an establishment that sells goods and services to the public.
In the flower business, we have observed these same parallels, where a talented individual floral designer/event planner starts a business to service events and weddings for a few select people or companies. This is usually out of his or her home or garage, then it progresses to a studio warehouse location (usually not open to the public) to continue working on referrals for more wedding and events. This is a great way to “de-risk” getting into the flower business without committing to a full-time payroll, high fixed location costs or carrying daily inventory.
We observe that, at some point, most of these studio florists start to receive requests to deliver flowers for special occasions. Existing event and wedding clients start calling and asking for a delivery service for special occasions and expecting service. Rather than continuing to decline these orders, the studio florist inevitably ends up becoming a traditional full-service flower “shop” by default, serving the public need for daily delivery service.
Ironically, we have observed the most financially successful florists have all taken this same progression of steps over the lifespan of their businesses, some faster than others. In some cases, this progression took a few years; in others, it took five to seven years. It is interesting to note that most of these operations had no prior experience in the floral industry.
Diversifying from a studio operator to a full-time retail operator also helps balance the cash-flow ups and downs from one-time special-event work. The downside is the need for full-time staffing and daily inventory required to service the retail side of the business. In many cases, these studios/shops also add flower classes to the mix to build the flower brand and draw in upper-end clients. We have seen this trend in almost every major city, not unlike the catering business, which has the same parallels of progression.
Many studio operations are very well versed in the budgeting process for events and weddings. These same financial control skills then transfer over into daily retail operations very easily. In fact, most of these flower companies are the most profitable operators we see, due to a keen eye on budgeting, purchasing and labor cost controls.
In some cases, studio operators make a conscious lifestyle choice and choose not to progress into daily retail. They typically work extremely hard every Thursday through Saturday or Sunday and take Monday through Wednesday off to recharge. This is not a bad trade off in many ways and is totally understandable.
The decision of each floral operator to deploy a studio or shop business model is based on personal lifestyle choice and goals as to what type of flower business he or she wishes to build over time. There are no right and wrong directions in these cases; the only key factor required is they must be profitable, no matter which path they choose to take.