Pricing Flowers for Profit - Fresh Ideas
More Top tips from the around Britain tour of florists.
Last week we talked about consistent sizing of products, if you remember the full and half sized loaves of bread scenario.
This week we are looking at fresh ideas on how to ensure there is profitability in your mark up. Ideas come from conversations I've had with florists up & down the country at BFA "Florist Get Together's"
In one conversation, Ed Scanlan from Florismart explained a guaranteed and consistent pricing method which gives a good experience for customers, whilst also ensuring year round profitability.
How is it done?
It was explained, Its the maths that makes it profitable. The logic makes sure you're providing a consistent experience for customers, which is the key aspect, if they are not happy, they may not return.
Treat every bouquet / wreath / basket with the following simple formula:
(1) Deduct operating costs of labour, rent, rates and all other fixed out goings (it's normally 25%)
(2) So every pound the customer spends, minus 25p from it, leaving 75p
(3 ) If your customer has spend £30
(4) This gives you a simple calculation on a calculator:
30 x .75p = £22.50
Now choose whatever flowers you want from stock price list, to the value of £22.50.
This way, whatever staff member makes the bouquet, at what ever time of year, they will always produce the same size bouquet. Thus avoiding a full loaf and a half loaf scenario.
We have included a rough guide to prices charged nationally by florists, these prices are for top notch flowers. For example the price for the lily, is for a lily that is 1metre tall with 4 plus heads, you would not be able to charge that for a 70cm 2headed lily, it's dishonest and is against the principle of making the same size bouquets.
If you don't agree with the prices, we have also sent a copy which is blank, for you to fill in. If you don't agree with the mark up rate of 25p in the pound you can change that too ( if it was 20p in the pound, you just times the spend by .8 )
Example. £30x .8 = £24
This system is designed to fit all shops as you can fill in your own prices and markups, but once it is done, you have system that will ensure same size bouquets and consistent profit.
*Note: included cellophane and a poly bow in the mark up fee. This will stop you working out small items constantly.
If you make a wreath or a basket follow this rule.
£30 x.8 = £24
Minus £5 for basket = £19 worth of flowers.
Why not try it on the next bouquet you make, to see how simple this really is.
Simon & Team
Look out for Next Friday: Comparison Buying for florists