FTD clearinghouse fees to 9%?

[Mikey the Flower Guy]

Mikey, I respect what you are doing in regards to your wire service. The only remark I want to make is that you are partnered with the wrong wire service.

First, let me say both wire services are trying to capture the consumer orders directly. But, one,FTD, is very much in your face about it. They are very blantant and are very open in thier quest for more and more money out of florists pockets and by diminishing the amount of service they return for those monies.

If you are satisfied with your operations within a wire service, then why not go with the wire service that is the least blatant about it. Plus, they have the edge with costs. I am similar to you in the fact that I still need a wire service and for the same reasons. Where I differ is I believe that by not going with FTD, I am withholding money they would use against me by marketing for the same consumer I am.

and I agree.....in this....there ARE both truths AND consequences.I have had a "counter offer" from a competing WS, and am taking a good long hard look at it!!...I'm at that point!!

 

[bloomz]

If you are satisified with your operations within a wire service, then why not go with the wire service that is the least blatant about it. Plus, they have the edge with costs. I am similar to you in the fact that I still need a wire service and for the same reasons. Where I differ is I believe that by not going with FTD, I am withholding money they would use against me by marketing for the same consumer I am.

I'm not too sure about that Fox - TF is also after the same consumer, and just has a slightly sneakier way of doing it. But it's still a Wolf in Sheep's clothing.

Granted they aren't drop shipping - yet, but they are doing a great job of getting between us and the consumer with all those advertising $$$ they would have you think go toward advertising TF florists.

 

[sfox]

bloomz

I'm not too sure about that Fox - TF is also after the same consumer, and just has a slightly sneakier way of doing it. But it's still a Wolf in Sheep's clothing.

Granted they aren't drop shipping - yet, but they are doing a great job of getting between us and the consumer with all those advertising $$$ they would have you think go toward advertising TF florists.

bloomz, the CEO of FTD had the nerve to say to Wall Street insiders that FTD was no longer concerned about florists, when he was questioned about FTD's move towards the supermarket business. To say that Teleflora is without blame is foolish, but FTD sits around dreaming up new fees and charges it can place on florists. Call , complain, they won't care.

bloomz because of your situation you are locked into FTD, but for any florist who can get away, don't walk, run, don't wait, run, don't look back, run.

There was another string here recently about the new drop ship items FTD is featuring. These people only want your monthly dues, fees, charges and whatever other kind of money they can extract from your pocket, the one thing the are not looking to do is leave any dollars in your wallet.

Just because Teleflora is not virgin pure, is no reason to stay with FTD.

 

[TOTO]

Ah YES, your REAL bottom line, EY?

I saw this thread I need to say something. One day my wife and I sat down to go through the Statement and we realized that we are not getting 80%, not 70%, not even 65%. We calculate it with the membership we get 62% return for every order we fill. That is outrageous we were shocked and we asked ourselves, how in the world do we make money as more and more local customer place orders online. Did you know that we pay $1.25 FTO and Dove Receiving the order and every Internet Order with Teleflora is $2.95. A phone call is cheaper anyway................... that was my 2 Cents

KUDOS to both you and your wife for taking the time to CRUNCH THOSE NUMBERS!

Sadly, most florists never do that, nor do they have an accountant who is savvy enough to properly reconcile a wire service statement to find out where the hemorrhage is.

Most LAZY accountants simply treat a check from a wire service as income and when you pay that wire service, they treat that as an expense.

Knocks your COGS (cost of goods) into the dumpster as well as blinding you to the reality of your losses.

Also, don't forget to take your FREE DELIVERY COSTS into account after you get to their bottom line.

If you've discovered a net of 62% after doo-ing all dat filling, and assuming your cost of delivery averages $7.95, and assuming that their average incoming order to you was $60.00 in wire service wampum, (net 71% on the surface), to recoup your cost of delivery in REAL MONEY, that would equate to another 18.66%.

$60.00 X 29% = (-$17.40) = $42.60 net to filler real dollars

$7.95 divided by $42.60 = (-18.66%)

Add that 18.66% to cover your real cost of delivery in real dollars to the net of 62% which you believe you are at, and VIOLA, your real net to you is 43.34%.

Assuming your COGS (cost of goods) is at 30% and your cost of labor is at 25%, that total alone is 55% which then means that, you're at a net loss of (-11.66%)

Pretty close to what I came up with back in 1984 when my lotus spreadsheet told me that, we were experiencing a net loss of (-10%) for every incoming order that we had been filling through the seven wire services we were a member of.

That's when we dumped six and kept only the one, the one which we owned pre 1994.

And now, we have none and send all of our orders out through the Independent Florist's Association at net to filler in the amount of 80% and at a cost to us of only $20.00 per month. www.myifa.org

Make no mistake that, the only profitable side in the wire order game is on the outbound side with the losses incurred on the inbound side.

However, we are still happy to fill orders for REAL FLORISTS as part of the tit for tat balanced scale of ebb and flow.

It's the 800 and floral dot con's which caused that scale to TILT in their favor and away from WEE REAL FLORISTS, which is why, we refuse to participate in their ponzi scheme.

Of course, and if some florists have nothing better to do, want to keep their designers busy, want to keep their drivers busy, and add the wear and tear, gasoline costs, and maintenance costs of their delivery vehicles, GO FOR IT!

Besides, what better way to advertise than to get your UNPROFITABLE PRODUCTS into the homes of recipients which you hope that, SOMEDAY, SOMEWAY, they will become one of your shop's best customers?

Which is why Herb Mitchell wrote his wonderful article long ago entitled " The Dangers of filling orders at a discount " and called that paragraph, " The Santa Claus Myth! "

Trust me when I say that, their version of Santa Claus ain't never gonna come to your town anytime soon!

But, they doo relish in perpetuating their WS MYTH because IT WORKS FOR THEM and NOT FORE YOU!

 

[bloomz]

bloomz, the CEO of FTD had the nerve to say to Wall Street insiders that FTD was no longer concerned about florists, when he was questioned about FTD's move towards the supermarket business. To say that Teleflora is without blame is foolish, but FTD sits around dreaming up new fees and charges it can place on florists. Call , complain, they won't care.

bloomz because of your situation you are locked into FTD, (WRONG) but for any florist who can get away, don't walk, run, don't wait, run, don't look back, run.

Just because Teleflora is not virgin pure, is no reason to stay with FTD.

Yes I do read what he says and you're right. I don't like that either.

I am not however locked in with them - I have two other viable options now - I am with FTD because I make the most money with them, but that can change on a dime as far as I am concerned.

However, TF, tho claiming to be more "florist centered" is using their florists now as their subcontracted labor forces, and using their membership fees to compete with them just the same. (except the drop ship stuff again)

Y'know - the sad part of this is - we're always claiming we own the same day delivery services, and we do, but I have been trying to pay attention and I am guessing (no hard data) that around half of my orders are not for same day delivery. So where does that leave us? Yup those people could just as easily drop ship something.

But this fact is not enough to leave them as long as I can make money from them. The day that stops or the grass gets greener elsewhere - I am done gone.

 

[Bigted]

But this fact is not enough to leave them as long as I can make money from them. The day that stops or the grass gets greener elsewhere - I am done gone.

Couldn't have said it better myself. I'd give you a green thing if I knew how.

 

[Joe Mioux]

Bloomz, aka JB, aka Jonathan.....

I think it would be helpful to explain what you do.

I have seen a lot of new florists wanting to log in here at FC and become members.

Many people do not know your niche in the flower market.

to be honest, it took a certain floral accounting/order entry vendor to fill me in on your operation. But lets' not do any dredging on this issue.

Suffice it to say, you have a niche and when you type things about wire services, it would be helpful to let people know your business model.

Joe

 

[bloomz]

Joe - You be wanting me to expose myself to the slings and arrows - again?

I keep my outgoing way more than my incoming and I try my best to compete as vigorously as I know how with the 4 1600 pound gorillas for orders most florists (including me) are losing to them.

I treat wire services like the sleazy be-atches I know them to be. This is my "model", and what I think we should all be doing. And sure as hell don't fill their orders, unless it's something that will make me look good, which virtually never happens.

I forward all the incoming underpriced skimmed junk orders to the shops here that want them. And I fill to full retail value all properly sold real florist incoming orders with a smile, cuz I know whose name is on them. We also have the largest, most efficiently run, most attractive, technologically advanced, freshest flowers full service flower shop in our city.

How'd I do Joe? :bouncy:

 

[BOSS]

I am not however locked in with them - I have two other viable options now -

Ain't life grand :jester

 

[Jerry]

Wow

Bloomz, aka JB, aka Jonathan.....

I think it would be helpful to explain what you do.

I have seen a lot of new florists wanting to log in here at FC and become members.

Many people do not know your niche in the flower market.

to be honest, it took a certain floral accounting/order entry vendor to fill me in on your operation. But lets' not do any dredging on this issue.

Suffice it to say, you have a niche and when you type things about wire services, it would be helpful to let people know your business model.

Joe

I was waiting, wondering, thinking. Than I forgot we lost all the rebel rousers around here.

I thought Joe was the calm one here. I there a hornets nest icon?

Who loves ya Bloomzie!

 

[KLAN808]

I am not a florist but I am in the industry, so I thought that I would provide a consumer point of view to this discussion.

I am a strong believer of buying flowers at a local flower shop. I have no problem walking into a shop and seeing teleflora or FTD in the window. Its the shops that utilize wire services that should just drop their sign and place the wire services sign on the front of the building that bother me. The only difference between grocery store floral departments and these shops are the milk and eggs. I like to be able to walk into a flower shop and know that when I ask for a bouquet of flowers that my recipient is going to get something that they just can't go online and click and buy.

I feel that the only thing that is going to save the B&M shop from being dragged down by mass market is generating their own identity and teaching the consumer the difference between a "Flower Shop" and a floral department in a grocery store.

Please don't think for a second that i'm talking about every flower shop, but I know from my experiances in the industry and as a consumer that a true flower shop is getting hard to find.

Maybe there will be a day that I can walk into a shop and not have to tell the designer not to make my order look like a wire service order. I'll keep my fingers crossed.

I will close by saying that I will always support my local flower shop and teach my children the same.

Keep your heads up!

 

[goldfish]

Can a shop like that turn around?

Yes. That's what we have been doing for the last two years.

Maybe. Like Lori said, it will take a lot of work.

And "a lot bit" of money.

Even with dramatic changes, I told the buyers to not to expect to make a profit for at least a few years. If they have to move the business next year, that timeline will increase substantially.

By "profit" if you mean a positive cash-flow for the business, I think a few years should be enough to turn it around. If they can't do it within a few years, I don't think they will ever make it.

But for most business owners, the more important question would be how long it would take to pay off all the debts and recoup all the money invested.

Now, THAT would be a taboo question for many small business owners. I would say, usually, it takes a very long time if ever.

 

[inferno63]

9% fee by FTD as explained to me by FTD

First, I am no longer affiliated with FTD or Teleflora, only 1800flowers....but that is in the air and I am in negotiations with Bloomnet, deperate to keep me as a member...

Anyway, when I joined FTD, the discount was 7%. I complained that my net profit % after all of the fees was not sufficient to justify staying with FTD. At that time they said that they could put me on the "Small Market Program" since I am located in a "Rural" area. My association fee dropped to $49 from $99 and I was content to keep filling their orders.....until.....I got the next statement. It seems that if you are on a "special" program your discount increases to 9% although your monthly membership fee drops.

Note to the wise* Just because a WS keeps you "busy", it doesn't mean you are making money. Run the numbers and you might find out that they are the only ones making money! I am carefully managing my Bloomnet and picking and choosing orders to maximize my profits. It is a game and can be played to a florist's advantage except with Teleflora and FTD. I could not make a penny with those services and dropped them quickly. I have talked to small shops that folded because of wire services. Beware! Do the careful accounting to know your status.