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The Floral World is Changing

The Floral World is Changing

COVID-19 is forcing floral industry businesses to rapidly develop creative new business models, doing things that were not even considerations just six months ago—and in most cases, the changes are a good thing and long overdue.

Just last July, we heard the news that a well-known $10 million retail flower shop, in business for more than 25 years, had declared bankruptcy. This came as no surprise to me because the CEO who had run this store for decades constantly refused to change his ways. He was still stuck in the 1980s floral world and would not even consider advice from outsiders. While the official filing said the bankruptcy was due to COVID-19-related issues, the real reason was his refusal to change his ways over the years as the floral world evolved.

We see many retail flower shops thriving in this pandemic and coming back stronger than ever financially, and it is a perfect case- study in how some owners handle crisis management. Clearly, many others were incapable of adjusting their variable labor and purchasing budgets to rapidly adjust to these last few months. Many of those have perished now and will not be coming back.

The more I travel and talk to retail florists around the country, the more I realize how fast consumer preferences and tastes are changing. What concerns me is the reluctance of many retailers to change and adapt along with some of these changes.

While the fundamentals to business success have not changed, the way people are shopping and buying fresh flowers has, and this has only accelerated in the current pandemic environment. In many major cities, event and wedding florists have pivoted to online DIY classes for their customers, and they now realize there is a national appetite for these types of instructional classes. This has led many of them to start shipping curated bouquets from their stores, something they never considered in the past.

Just a few decades ago, no one could buy fresh flowers directly from a grower—unless you happened to live near a grower in your area. That has changed dramatically as overnight shipping options have improved and rates have dropped for last-mile delivery.

While some florists are just now putting in GPS systems in their delivery trucks to help their drivers be more efficient, other companies are now trying to eliminate drivers and trucks completely, opting instead for autonomous delivery vehicles and drones. It is estimated that in five years, autonomous delivery will be an option with most retailers for all packages less than 20 pounds.

While some florists are trying to adopt holiday-style production methodologies to service everyday business production needs, other companies are trying to automate the production of flower arrangements to eliminate design labor from the equation completely.

While some florists are trying to open new brick-and-mortar locations to expand sales and promote their company brands, other companies are opening floral vending machines in airports, hospitals and shopping malls—with no staff needed at all.

The pandemic has accelerated all these trends now at a pace that we thought was unimaginable just last year. And this year, consolidation in the floral business is happening even faster than we ever imagined. While there may be fewer flower shops at the end of 2020, those remaining will be more productive and profitable than ever before.

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