Flower prices are important, but flower pricing trumps that!!
Over the last few weeks, I've been travelling the country attending BFA Florist Get Together meetings, and honestly, its been an absolute pleasure! Conversations have been illuminating, candid and very enjoyable. Over the coming weeks, I'll be sharing a few short snippets of hot topics discussed. Here's one is real eye-opening question prompted by Ed Scanlan from Florismart, this little conversation got everybody talking and perhaps more importantly, thinking about pricing!
So, to get an understanding of the key concept, picture this.....
It's June and a customer comes into your flower shop and buys £30s worth of iris for his lovely wife. He goes away delighted with 60 stems of fresh Iris ( summer retail price 50p ) ( forgetting make up charges for this example ) Both customer & wife are delighted with the size of the bouquet.
In January he comes back for a repeat order - £30s worth of Iris ( winter retail price £1.)
Guess what, this time he spends the same but this time he receives considerably fewer, 30 stems of Iris. The customer is mystified and his wife disgruntled.
Why is that? Why do we do this? Well, of course we know why - buying prices throughout the year fluctuate. But should this fluctuation be passed back to the customer?
This example applies to all products sold through Florists which uses the variable price method, the florists in this example has created internal competition, when it's tough enough on the high street already.
Ed Scanlan asked us to consider this; if it's £1 for a loaf of bread how would you feel if it was £1 for half a loaf of bread the following week? Ed asked the room, would YOU go back to that baker for a third time ? to which they all answered NO.
Ed points out inconsistent pricing like this can be very damaging for the reputation of any business.
Rather than calculating prices weekly or monthly Ed urges florists to calculate an annual price and maintain year-round consistency. The key thing is to calculate prices at the most expensive time of year in order to guarantee profit margin ie January.
Next Friday - How to calculate margin. Fresh thinking on mark up.
Simon & Team