It’s just over a week old, but this article from the WSJ on independent coffee shops thriving despite Starbucks is still worth mentioning. It speaks directly to the environment and circumstances facing many retail florists in today’s market as they try to compete with big chains and supermarkets.
The article describes how smaller coffee shops are thriving in the face of - and next door to - Starbucks, and are in fact benefitting from the fact that Starbucks has pushed coffee from a commodity into a high-end product.
While Starbucks is facing the inevitable struggles of a big chain, independents are capitalizing by providing quality products and more personal service - and targeting some niches that Starbucks can’t attract with their broadening range of products.
While FTD/Teleflora/ProFlowers and the rest will never be accused of taking floristry from commodity to luxury (actually, you can make a case for the opposite) it’s clear that big chains and corporations always have to target the mass market leaving some profitable niches on the table for smart and enthusiastic business owners to claim.
What do you think? Are big chains and corporations a threat to the smaller florists, or an opportunity? How can florists capitalize on the holes in the corporate product offerings?
{ 3 comments… read them below or add one }
9/6/08
I’m from Michigan and the big chains/box stores are hurting just like the rest of us in Michigan’s economy. On a wholesale level, they have cut the numbers of flowers and plants they contracted, hurting the local grower. On a retail level,
they have sharply decreased the square footage allotted to fresh product. So can the smaller shop compete with niche marketing—yes, to a degree. What the local floral shops/floral organizations need to address is the inequity in wholesale pricing for the box stores vs. the floral shop. One answer is to develop
a chain of floral shops which many are doing. Another possibility is co-operative buying which is hard to get organized. Does anyone have any other ideas?
They only hurt florists, in general, who do the same style and use the same flowers as the chains. Big chains beat florists on price and convenience and Americans value that a lot of times over service and quality. The answer is easy, do the opposite of big chains, but 95% of florists don’t understand what that even means.
All florists paint, some on a canvas and others the side of a house.
@ Nancy:
I think independent florists have a singular opportunity, or perhaps a requirement to make some changes. Even large companies that are profit driven, like Grower Direct here in Western Canada are losing stores. In 10 years, they have gone from 150 stores to 65 or so.
I think the idea of a non, or limited profit co-operative is the way to go for our business. There is too many levels of profit taking to compete as a single entity. This will allow us to gain some control and leverage over both the product and the price. Many factors are affecting this, including shipping costs, increased wholesaler pricing due to slowing economy, box stores. The box stores are using the same sources as us, but have much more negotiating power due to their order size, so who has to pay for that? US!
There is a belief out there that we florists don’t have a clue what is going on in our businesses, and the wire services, wholesale discount delivery companies, box stores and order gatherers are due for a wake up call.
If we don’t, we will continue to lose our market share.