Florist/Flower Market

Part
01
of five
Part
01

Growth Trend for Purchases from Independent Florists

There are not enough statistics in the public domain to reliably determine how the number or percentage of consumers purchasing flowers from local florists has changed in the past three years. While there are a few surveys suggesting that most consumers purchased flowers from independent florists in years 2016 and 2017, there are several other sources that contradict this information. The fact that numerous local florists have closed shop in recent years after losing business to online vendors and mass merchandisers suggests that the number or percentage of consumers buying flowers from neighborhood floral shops has decreased.

2019

  • Forbes published an article reporting that the number of retail florists in the country had dropped from 19,822 in 2007 to 14,606 in 2012. These figures suggest that the number of consumers buying flowers from retail florists has dropped as well. According to Farbod Shoraka, one of the founders of BloomNation, a startup aiming to help independent florists with its online tools, online companies "are taking half the money from florists and not caring about the customer experience at all."

2018

  • Voices of Monterey Bay published an article reporting that mass merchandisers such as supermarkets and big box stores, and online vendors such as FTD and Teleflora, had been taking business away from independent florists. This information suggests that, in 2018, there were fewer consumers who bought flowers from independent florists.

2017

  • The Society of American Florists and the American Floral Endowment polled 43,145 adults making floral purchases and interviewed 14,692 adults making floral purchases. The results of this survey, which were published in the Floral Purchase Tracking Study, show that in 2017, consumers purchased flowers mostly from local florists and supermarkets/grocery stores.
    • Male consumers purchased flowers from the following retailers/locations: local florist (43%), supermarket/grocery store (21%), online floral service (8%), home improvement store (5%), nursery/garden center (5%), farmer's market (5%), discount or chain store (4%), sidewalk or street flower vendor (4%), wedding planner (3%), non-profit organization (2%), and others (2%).
    • Female consumers purchased flowers from the following retailers/locations: local florist (29%), supermarket/grocery store (41%), online floral service (6%), home improvement store (4%), nursery/garden center (5%), farmer's market (4%), discount or chain store (5%), sidewalk or street flower vendor (2%), wedding planner (1%), non-profit organization (1%), and others (2%).
    • Younger consumers aged 18-34 and 35-54 were more likely to purchase flowers from local florists than older consumers aged 55+. Older consumers aged 55+ were more likely to purchase flowers from supermarkets/grocery stores than younger consumers aged 18-34 and 35-54. Forty-two percent of consumers aged 18-34 purchased flowers from local florists, while 47% of consumers aged 55+ purchased flowers from supermarkets/grocery stores.
    • The full version of the Floral Purchase Tracking Study is paywalled unfortunately.
  • The New Leaf co-owner Sarah Mumford said that "younger customers tend to favor digital services" as far as floral purchases are concerned. This contradicts the finding in the Floral Purchase Tracking Study that younger consumers preferred buying from the local florist.
  • Garden Center Magazine published an article reporting that almost 40% of flower businesses in the United States had closed shop since 2000. National wire services with steep marketing fees and commissions reportedly had pushed independent florists into oblivion. This information suggests that fewer consumers were buying flowers from independent florists.
  • Delaware Business Times published an article reporting that since 1992, the number of neighborhood flower shops in the United States had declined from 27,341 to 14,161. This information suggests that consumers buying from these neighborhood flower shops had dropped as well. Chuck Cinaglia, who owns Boyd's Flowers in Wilmington, said "it's the online guys who have six-and-seven-figure advertising budgets, they're the ones that are siphoning off the business from the small brick-and-mortar flower shops."
  • Delaware Business Times's article reported that most flower purchases still happen in a physical store, but this store, in most cases, is a retailer other than a traditional flower shop. It also reported that of fresh flower sales in the country, 48% were accounted for by grocery stores, and 35% were accounted for by traditional flower shops.

2016

  • The American Floral Endowment and the Floral Marketing Research Fund polled 3,011 millennial consumers. The results of this survey, which were published in Marketing Tactics to Increase Millennial Floral Purchases, show that millennial consumers purchased flowers from local florists (69%), grocery stores/mass merchandisers (63%), farmer's markets (57%), nurseries/garden centers (50%), local florist websites (35%), online national flower retailers such as FTD and 1-800-Flowers (34%), street flower vendors (30%), online LivingSocial or Groupon deals (17%), convenience stores/gas stations (14%), and toll-free telephone services (2%).
  • Nielsen polled consumers making floral purchases and found that of these consumers, 24% bought flowers from grocery stores, 9% bought flowers from mass merchandisers, 7% bought flowers from convenience stores or gas stations, and 5% bought flowers from club stores. These numbers are very different from the figures reported for millennial consumers.

RESEARCH STRATEGY

In our attempt to determine growth trends in the number of consumers purchasing flowers from local florists, we employed three strategies. First, we checked if the information is readily available in the public domain. Since growth in the past three years is of interest, we read through relevant articles and reports that were published no more than three years ago. Only a few sources cover the floral industry in the United States. Industry reports published by First Research and IBISWorld, articles published by Delaware Business Times, Voices of Monterey Bay, Garden Center Magazine, Forbes, and Inside Business, and surveys published by Nielsen, American Floral Endowment, and the Society of American Florists were the sources we found and consulted. The surveys published by the American Floral Endowment and the Society of American Florists show that consumers in 2016 and 2017 purchased flowers mostly from local florists, but the rest of the sources contradict this finding.

Second, we focused on the survey results provided by Nielsen, American Floral Endowment, and the Society of American Florist, and checked if the growth rate can be triangulated. We quickly found, however, that the desired percentages could not be triangulated, as there is simply not enough data in the public domain to do this. The available statistics are not comparable as well. For example, the 2016 percentage distribution provided in American Floral Endowment's report was specific to millennials only, while the 2017 percentage distribution provided in the Society of American Florists's report was specific to male consumers and female consumers. The percentage distribution provided in Nielsen's report is also incomplete.

Third, we turned our attention to how the sales or number of local florists has grown. We figured that changes in the sales or number of local florists in the country could be indicative of changes in the number of consumers purchasing flowers from local florists. There are several articles indicating that the number of independent florists has long been on a downward trend, and more and more independent florists are losing business to online vendors and mass merchandisers. Among these articles were articles published by Delaware Business Times, Voices of Monterey Bay, Garden Center Magazine, Forbes, and Inside Business. This decline in the number of independent florists suggests that more and more consumers are turning to online vendors and mass merchandisers for their floral purchases. The rise of BloomNation, a startup helping independent florists to stay in business, supports this observation.
Part
02
of five
Part
02

Independent Florists

There are around 12,600 independent florists in the United States. The industry is largely fragmented with the top 50 players making only 10% of the industry revenue.

FINDINGS

  • There are 12,600 independent florists/ small florist retailers in the United States.
  • The breakdown of florists by firms size:
    • Total: 12,675
    • 0-4 employees: 8,415
    • 5-9 employees: 2,935
    • 10-19 employees: 964
    • <20 employees: 12,314
    • 20-99 employees: 329
    • 100-499 employees: 26
    • 500+ employees: 6
  • The top 50 florists in the United States make only 10% of the industry revenue. The industry is largely fragmented.
  • 1-800-Flowers.com, Teleflora, and FTD are among the popular floral companies in America.
  • Three-quarters of the flowers sold in the United States come from Ecuador and Colombia.

RESEARCH STRATEGY

The US Census provides a breakdown of the number of florists by firm size. The most recent data published by the US Census is for the year 2016. Given that small retailer/ independent retailers are those with 50 or fewer employees, we used census data to determine the number of florists with 50 or fewer employees in the United States.

The total number of florist firms in the United States is 12,675, of which 12,314 have fewer than 20 employees and 329 have between 20-99 employees. Only 2.8% ((12,675-12,314)/ 12,675) of florists have over 20 employees. Therefore, it is likely that among the firms with 20-99 employees (329), most would have 50 or fewer heads. There is likely to be little difference between the number of florists with <= 50 employees and those with <=99 employees.

The number of florists with 99 or fewer employees is 12,643 (12,314+329). So, it can be said that the number of florists with 50 or fewer employees (or the number of independent florists) in the United States is approximately 12,600. This translates to roughly 43 florists with 51-99 employees.
Part
03
of five
Part
03

Florist Market Segmentation

The florist industry in the United States is fragmented, with only 12.5% of the industry revenue coming from large florist chains. The independent florists in the United States account for a lion's share (87.5%) of the florist market.

FINDINGS

  • Independent florists account for 87.5% of the US florist market, while large chains account for 12.5%.
  • The top 50 florist firms generate 10% of the industry revenue. 1-800-Flowers.com, Teleflora and FTD are some major players in the industry.
  • There are around 13,000 florist shops in the US and the average annual revenue generated by a shop is $322,000.
  • In 2016, Americans spent $95.14 on an average on flowers, seeds, and potted plants.
  • In 2017, consumers in the US spent $35.173 billion on flowers, seeds, and potted plants.
  • Sixty-eight percent of the Society of American Florist members said that they "experienced increased Valentine's Day sales" in 2018, and 60% increased Mother's Day sales.

RESEARCH STRATEGY

In order to find the independent florists' share of the florist market, we began by searching for research reports on the US floral industry. While we were able to find overviews of reports by agencies such as First Research, IBIS World, Anything Research, Arizton, Merchant Research Consulting, none contained the required statistics. The only relevant data we could find across these sources was that the top 50 florist firms account for 10% of the industry revenue. Next, we searched the US Census and the US Bureau of Economic Analysis for the required metric. The US Census provides the break up of the florist firms by employee size, the number of establishments, the annual payroll, and the headcount. However, it did not provide any data pertaining to revenue breakup. Following this, we searched industry portals and media agencies such as Floral Daily, The Independent Florist Association, Society of American Florists, The Flower Expert, About Flowers, PR News Wire, and Business News Wire, but met with little success. Given the unavailability of precompiled data, we triangulated an estimate.

As estimated in another report (Independent Florist) in this project, the number of independent florists in the United States is 12,600. The total number of florists in the United States is 12,675. Therefore, the total number of large florist firms in the United States is 75 (12,675-12,600). We know that the top 50 florists in the United States account for only 10% of the total revenue. Therefore, the top 75 will not account for more than 15% (75*10/50) of the industry revenue. The large florists are likely to account for 10-15% of the industry revenue. As the range is not very large, it will be reasonably accurate to say that 12.5% (10+15/2)--the middle value of the range--of the florist industry revenue can be attributed to the large corporations. Correspondingly, independent retailers account for 87.5% (100-12.5) of the market size.


Part
04
of five
Part
04

Software Tools for Independent Florists

The top software tools that local and independent florists in the United States use to run their businesses are Curate, Details Flowers Software, FloristWare, Floranext, and Hana POS.

CURATE

  • Curate provides a remarkable digital experience for florists as well as their clients by creating fast proposals and accurate ordering and inventory system.
  • It has a 98% average user satisfaction rating based on ease of use, meeting requirements, and ease of doing business with.
  • It prevents possible losses due to accidental overage in ordering. Curate users, or "Curators", reported a 10% revenue increase due to waste prevention by using Curate software.

DETAILS FLOWERS SOFTWARE

  • Details Flowers Software helps users organize events, connect with suppliers, and ensure profitability by giving attention to every arrangement and simplified payment process.
  • It was rated 4.9/5 in GetApp and 100% recommends this to a friend or colleague.
  • Some features include production and delivery tracking, card printing, and customer account profile.

FLORISTWARE

  • FloristWare is an easy-to-use and affordable POS/CRM solutions provider that helps florists increase profits and sales while saving time and money.
  • It has a 94% average user satisfaction rating based on ease of use, meeting requirements, and ease of doing business with.
  • FloristWare is a proud member of the Society of American Florists (SAF).

FLORANEXT

  • Floranext provides a one-stop florist software platform that helps florists run their entire flower shop efficiently.
  • It was rated 4.6/5 in GetApp and 100% recommends this to a friend or colleague.
  • Floranext also enables users to build their own flower shop website.

HANA POS

  • Hana POS is designed to help independent florists become successful by providing a POS, their own website, and an entire marketing solution.
  • It was rated 4.3/5 in GetApp and has 87% positive reviews.
  • Other features of Hana POS include automatic card printing and integration with wire services.

Research Strategy:

For this request, we initially looked for the top/best software tools for florists in the United States and utilized results from websites like G2, GetApp, and SourceForge. It was stated that from the 12,675 independent florists (or small florist retailers) in the US, 12,314 has less than 20 (mostly 0-4) employees. Therefore, to give specific focus on independent florists, we filtered the results to software tools that are designed and used by businesses with "0-10" employees or for "small businesses" in the US.

To determine the top software tool, we initially chose the ones that are consistently mentioned as among the top or best software tools that local and independent florists use. Then, we carefully checked their ratings, reviews, and satisfaction scores. We then selected the most reviewed software and from them, we chose the ones with the highest ratings and satisfaction scores and came up with the top five software tools presented above.
Part
05
of five
Part
05

Flower Spend by Country

The US, Germany and the Netherlands are the top countries with the highest spend on flowers in 2017. The overall market size for flowers was $8.4 billion in 2017. These are outlined below.

TOP CONSUMER COUNTRIES FOR FLOWERS

ADDITIONAL FINDINGS

  • The top exporters of flowers in 2017 are the Netherlands, Colombia, Ecuador and Kenya.
  • The Netherlands had 43% market share in 2017 worth $3.68 billion.
  • US Colombia had 16% market share in 2017 worth $1.4 billion
  • Ecuador had 10% market share in 2017 worth $847 million.
  • Kenya had 8.1% market share worth $688 million.

RESEARCH STRATEGY

To determine the top countries with the highest spend on flowers, we started with the market report mentioned in the Early Findings and identified the US, Germany and the Netherlands as the top markets. The report also stated that demand for flowers is based on discretionary customer spend.

We researched for separate market reports and identified the UN COMTRADE as the main source of trade information with dollar value. We found a visualization of the most recent data from OEC and provided the requested information above for the top countries. Therefore, we used the Early Findings report and researched trade data from OEC and UN COMTRADE to address the request.
Sources
Sources

From Part 05
Quotes
  • " Major importers of cut flowers include the US, Germany, the Netherlands, the UK, France, Russia, and Japan."
  • "Demand for flowers depends on discretionary consumer spending."
Quotes
  • "United States Import Value - $1.74B Percent - 20%"
  • "Germany Import Value - $1.2B Percent - 14%"
  • "United States Import Value - $921M Percent - 11%"
Quotes
  • "The Netherlands Export Value - $3.68B Percent - 43%"
  • "Colombia Export Value - $1.4B Percent - 16%"
  • "Ecuador Export Value - $846M Percent - 10%"
  • "United States Export Value - $688M Percent - 8.1%"
Quotes
  • "For more recent data (2001 - 2017), we use data provided by UN COMTRADE."
Quotes
  • "0603 Name: Cut flowers and flower buds of a kind suitable for bouquets Description: Cut flowers and flower buds of a kind suitable for bouquets or for ornamental purposes, fresh, dried, dyed, bleached, impregnated or otherwise prepared."
  • "060310 Name: Cut flowers & flower buds of a kind suit. for bouquets/ornamental purps., fresh Description: Cut flowers & flower buds of a kind suit. for bouquets/ornamental purps., fresh"
  • "060390 Name: Cut flowers & flower buds of a kind suit. for bouquets/ornamental purps., dried Description: Cut flowers & flower buds of a kind suit. for bouquets/ornamental purps., dried/dyed/bleached/impregnated/othw. prepd."