“Flowers delivered as fast as possible with as little wasted product as possible”
Most flower shops I work with these days still operate on outdated 20th-century production and delivery operating models.
The customer calls by phone. The salesperson allows the customer to pick one of 500 SKUs on the website, or even worse, he or she allows the customer to define a “custom” arrangement. The design department scrambles to make what was requested before the priority time. Delivery has to wait until the order is completed by production. In the typical flower shop, after an order is placed, it takes an average of four to six hours to deliver.
The operating model described above is common in 80 percent to 90 percent of the floral retailers I work with. It seems like the business is running the staff rather than the other way around.
With today’s hyper-retail-delivery-focused consumer, this old model can no longer compete with Amazon’s and Whole Foods Market’s two-hour delivery model.
If you started with a bank sheet to create the most efficient and fastest delivery service, with the lowest cost of labor, it might look something like this.
Define Featured Arrangements in Advance
This allows fresh and hard-goods purchasing to be more efficient and predictable each week. Standing orders and low stock alerts can be set up. Production assembly can also speed up dramatically, perhaps even one day to be automated using robots. Flower stems from incoming boxes are used in multiple and different arrangement styles. The same container is used in multiple featured arrangements in different styles and sizes (much like Toyota uses the same platform across multiple car models). These featured items are professionally photographed, with a creative description and name for each one.
Each completed (but not sold) arrangement is tagged with a unique barcode that has the SKU, date and time of assembly, the physical location and the date to be aged out of inventory.
Sales Priority and Real-Time Promotion
Each inventory item then moves up the priority rank on the website and is promoted in real time. The more units kept on hand of any one SKU, the higher the priority (the same rule applies with phone and in-store salespeople).
Hyper On-demand Delivery
The units in inventory are now available for “hyper-speed” delivery, which means a consumer can pay a delivery premium for one-hour delivery. Instead of charging a flat $10 for delivery, the one-hour delivery fee is now $19, for example. In this scenario, we are beating Amazon at their own game. If you’re not charging delivery fees based on time priorities, you’re losing a lot of incremental revenue and disappointing consumers who want on-demand delivery. It’s a fact that today’s consumers are willing to pay premium fees for this service.
Hyper Pick-up Speed
BOPIS (buy online, pickup in store) is now an option with these same SKUs. Once an item is paid for online, that SKU is blocked from being sold and is set aside for curbside pick-up or delivery.
Live Inventory Control
As each SKU is sold (from any location), an automatic restock notice goes back to production. As the SKU is sold out (even for minutes or hours), the priority status moves down on the website and for the salespeople, and other items on hand move up the priority promotion scale.
Sales and Delivery 24/7
Most retailers I know refuse to deliver orders when they are closed. These same production/operating rules can now be employed to deliver completed on-hand arrangements after hours. All arrangements in stock (at any physical location) are the only items available for after-hours, immediate, on-demand delivery. You may use an on-call driver or even a 24/7 kiosk tied to your website.
Aging Out Unsold Inventory
We should never sell flowers that will not last at least seven days to any consumer. Unfortunately, this is a problem for many florists because they don’t keep track of how old items are in their coolers.
Any completed SKU that has been on hand for more than a predetermined number of hours is removed and tagged for delivery to a local hospice or nursing home. This becomes part of the retailer’s community give-back program, which should be highlighted heavily on social media.
Any flower stems aged out are used for a once-per-week consumer volunteer classes, where consumers can come into the store and learn how to arrange flowers, which are also delivered by them to local nonprofit partners (such as Meals on Wheels, a children’s hospital, etc).
In the operating scenario described above, nothing goes to waste. Every fresh flower is sold as quickly as possible, and unsold flowers are used for local promotional purposes. This creates a win-win scenario all around.
Alex Frost has founded and operated multiple technology and marketing companies in the floral industry over the past 25 years. He has also developed unique supply-chain software for the flower industry. Contact him via email at firstname.lastname@example.org.