Is 30% of Something better than 0% of Nothing???

[RC in Dayton and Cincinnati]

Ricky,

Not sure exactly what your asking, but another reason I don't want incoming wire orders is I don't want to buy wire service containers and don't want my designers looking up and filling to detailed recipes.

I know many will say it only takes a few seconds to look up an item to fill in the proper container and using the proper flowers. But that's bull s.h.i.t.

Any interruption in production, no matter how insignificant it may seem, derails any ability to produce in an efficient manner. On top of that switching from recipe to recipe creates junk buckets of flowers, unless of course someone spends much of their time keeping loose stems organized.

Being a firm believer the consumer is not willing to pay for our inefficiencies, I do my best to create a business model that is as streamlined as possible.

So, if your asking if simplified designs and selections would help, the answer is yes, but that is my perspective as the wire services would rather offer the customer a wide selection with a large selection of flowers, even if the results are far below customer expectations, which leads to another reason I think incoming wires are bad, the consistent over promising wire services do.

RC

 

[Mark Anderson]

Hey Bloomz,

I know you like to mix things up and that's cool.

My real point is this: I believe this board can be a serious source of information and that when the "insiders" post in the serious sections they need to choose their words carefully.

(Mark) then uses a little known trick to call a statement of fact a "trick question".

If you don't like me calling it a trick question (even though it was phrased as a self-evident question) then I'll call it a false assumption instead. My real issue is with the logic...

IF

30% of something is better than 100% of nothing

THEN

Go fill all the incoming you can!

...and then the assumption that incoming wires somehow net you 30%. I hear what you are saying but I still don't believe it is a statement of fact to say that florists can expect to keep 30% of incoming wire orders.

Mark hints of our consultants veracity - is he working for bloomz - or is he secretly working for (cue the creepy music) FTD??? To mislead bloomz into being part of the zombie army of FTD automaton slaves?

Since you want to discuss tactics I think your criticism of my question would be considered "Reductio ad absurdum" - defined as "a form of argument in which a proposition is disproven by following its implications to a logical but absurd consequence."

(Mark) finds an example of excessive lunacy (joining 5 wire services in a week...

It's an extreme (but absolutely true) example for the purposes of illustrating what can from an over-simplified argument like "If revenue is good then you should pursue as much incoming as possible".

If a florist is struggling with one traditional wire service is there anyone who really thinks that they will be better off adding even one more traditional service and all of the extra listings that tend to go along with the goal of encouraging more incoming business? It doesn't take five wire services to kill a shop.

To some extent this whole discussion is great example of the fallacy of the excluded middle or false dilemma. The conversation tends to drift to one of two extreme viewpoints: NO Incomings or ALL Incomings. There are a lot of positions in between!

If a shop is a member of service X, has their website, POS and credit card clearing and is very happy with the sending then yes - it probably makes sense to fill incoming orders that can make a profit.

Automatically rejecting every single incoming would not make sense. Neither would joining more services to pursue more incoming.

We all know there are a lot of members that just read the posts. I worry that they might be misled by the oversimplifications. That's all.


P.S. Bloomz - my boys love those Bakugans too. That is the business we should be in.

 

[clay]

I think that distorting that this consultant "would still be espousing" the above based on his consultation with one client is wrong. FTR, he has no love affair with wire services, and he would be the first to tell a florist to cut one or all wire services depending on his review of their particular busines and their situation. Bloomz's "situation" is that he is not going to be leaving the wire services, for his own reasons, so his consultation comment to Bloomz only applies to Bloomz...IMO.

 

[sandytf]

Ok, We covered the part of my question about buying in huge quantities.....and RC said that even with 500/600 full boxes of flowers weekly, he did not feel that was enough to make incoming profitable.....so, lets add the other part of my question to the equation......that was METICULOUS AND EXACTING ATTENTION TO THE POSTED RECIPE.

This shop follows to the letter the exact recipe for any given WS arrangement. Not one stem, flower, or leaf in the design other than what is listed.

I'll give an example.....during Mother's Day, there was an FTD vase design that used 3 stems of stargazers and 2 stems of limonium in a rectangular vase. No additional greens, No additional flowers. No additional ribbon....nothing at all except for the 5 stems of flowers.

Could that be the missing difference?

The problem I find with that, Ricky, is that it doesn't look like the picture. Apparently, when they make those designs for the photo shoots, the flowers are on steroids. I often find the recipe calls for one stem but we need to use two or three to make it look like the photo.

I agree with RC that filling those orders s..l...o.....w.....s everything down. If the number of orders we filled last Mother's Day had been predominantly local rather than wire-ins, I'm guessing we could have cut our labor by 25%-30%.

Not to mention, there is no possible way to carry all those containers and every flower that the selection guide shows. If we buy all the MD special containers, we inevitably have a couple that are not the best sellers and then we eventually end up discounting them to get rid of them.

My overall opinion on making money on wire-ins: You CAN do it, but you better be one smart cookie and be paying attention to A LOT of variables that are constantly changing. IMHO, if most shops put the investment into other strategies that they're putting into a wire service (whether they realize it or not) they have a better chance at success.

P.S. I thouroughly enjoy the meticulous debate/rebuttals of these threads. I get totally absorbed into it!

 

[Mark Anderson]

I think that distorting that this consultant "would still be espousing" the above based on his consultation with one client is wrong. FTR, he has no love affair with wire services, and he would be the first to tell a florist to cut one or all wire services depending on his review of their particular busines and their situation. Bloomz's "situation" is that he is not going to be leaving the wire services, for his own reasons, so his consultation comment to Bloomz only applies to Bloomz...IMO.

That is completely fair of you to say and if I have put words in this persons mouth than I am truly sorry.

The opinion I expressed was based on repeated second-hand comments from Bloomz about the advice he had received. I took them to mean that the "take more incoming" was the standard message.

I should not have made that assumption and have edited my post. Thank you for making me aware of the bigger picture.

 

[goldfish]

Just a tecnical correction since I'm working on a Sunday morning and I'm grouchy. The phrase is actually 30% of something is better than 100% of nothing.

I think JB's 30% is referring to contribution margin: = (gross profit) / sales. Wire-in's contribution margin is about 30%, whereas typical local orders' contribution margin is ~60%, twice as much as wire-ins. So he could have said 30% of wire-ins that exist versus 60% of the local orders that don't exist.

 

[bloomz]

Mark - I too sometimes worry about the newbies here that take that blind often irrational anti-wire passion as gospel. It is a prevailing topic here and every bit as wrong as "everybody should fill more incoming".

Everybody nees to see both sides of the picture. But I'll shoot a guess that a landslide majority of members here are happy to get incoming, and join wire services for that very reason. I think we all know the #1 question asked of wire service reps.

Here's one - if you find a way to contribute to your fixed expenses, you should closely examine and quite possibly institute it. For some/many, filling incoming is one way.

For others it is selling beanie babies and even espresso. Never mind that Ty once crapped on all the florists and those beans may be grown in the wrong country.

(btw - i love your argument label - I wish I could remember all them - there's a website I found once that has all those greek names for different fallacy argument tactics.) OH- I found it!

Reductio Ad Absurdum:

showing that your opponent's argument leads to some absurd conclusion. This is in general a reasonable and non-fallacious way to argue. If the issues are razor-sharp, it is a good way to completely destroy his argument. However, if the waters are a bit muddy, perhaps you will only succeed in showing that your opponent's argument does not apply in all cases, That is, using Reductio Ad Absurdum is sometimes using the Fallacy Of The General Rule. However, if you are faced with an argument that is poorly worded, or only lightly sketched, Reductio Ad Absurdum may be a good way of pointing out the holes
​

I believe yours was the Straw Man argument.

Straw Man (Fallacy Of Extension):

attacking an exaggerated or caricatured version of your opponent's position.
For example, the claim that "evolution means a dog giving birth to a cat."
Another example: "Senator Jones says that we should not fund the attack submarine program. I disagree entirely. I can't understand why he wants to leave us defenseless like that." On the Internet, it is common to exaggerate the opponent's position so that a comparison can be made between the opponent and Hitler.
​

Clay is absolutely right - Gaylon looks in depth at my particular situation. He's also instructed me to quit one completely.

I was speaking of my particular situation, and that was perfectly clear from the beginning but I think missed somehow in the blindness of the issue for some.

Selective reading confirmation bias - we all have it.

nap time

 

[RWK]

Thanks for the remarks on the questions.......Like I said, Other than buying in quantity and filling the order to exact specifications and recipe.....What else is there that could possibly make wire-in's profitable?

The containers are usually fairly high in price and like Sandy said.....there are bound to be ones that sit on the shelf because they just did not sell.....so that knocks that one out......
The amount and variety of flowers needed on a daily basis to fill any order that might come in to specifications......no way to keep that many and that much of variety on hand......so that knocks that out,
It takes time to look up each recipe as it come in either in a workbook, poster, or online....( I think I counted at least 7 different TF-WEB books alone - so you have to know in which book is the arrangement on order......so that knocks that out of contention..............

Not to mention things like staffing, delivery, dconns, asks, cons, dens, and all the communications that go on.........

So what else could there be that would make wire-ins profitable?

I sure can't figure it out.

 

[LJVF]

So what else could there be that would make wire-ins profitable?
I sure can't figure it out.

Some of the typical reasons usually given:

• incoming help move inventory
• incoming orders may not contribute much, but contribute nonetheless
• incoming help make idle fixed labor more efficient
• incoming orders are orders that the competition don't get
• incoming orders provide contact information to potential customers that can be marketed to

Pick your flavor.

Are some of these legitimate? Maybe
Are some of these bogus? Probably

IMO it's an almost impossible debate, only the incoming florist can know the real truth.

Remember, the most profitable wire service members are the ones that send more than they receive.

 

[kt4ye]

Could buying in vast quantities and following the recipes to the letter be the critical difference in losing with incoming WS and winning with incoming WS?

Give the man a cigar!

ALL WS recipes are based on costs that are (usually) derived from "average" wholesale prices. They then use arbitrary markups and add a "designer fee" that is based on another arbitrary percentage of the wholesale cost.

Take 30% (WS fees etc) off the derived price and you are into "marginally profitable" territory.

But what happens when you BUY direct out of Miami or wherever rather than getting your "bread and butter" stuff from a local wholesaler?

Here's what happens: Your COGS for all your "bread and butter" items gets CUT IN HALF!

NOW run the numbers. Profitable? You betcha.

BUT you usually can't "buy direct" from a reputable Miami source unless your volume is at least comparable to that of a small wholesaler. And they won't sell to you unless you have a SUPER reputation for paying your bills on time.

The challenge, then, is to achieve that volume level. And that ain't easy when WS are signing up every TD&H shop in town! That's the primary reason why we dumped FTD: not enough incoming business to cover the monthly.

Excellent thinking, Ricky!

 

[RC in Dayton and Cincinnati]

Bloomz,

You should listen to your consultant. That's what you're paying him for.

 

[Flore]

Thanks for the remarks on the questions.......Like I said, Other than buying in quantity and filling the order to exact specifications and recipe.....What else is there that could possibly make wire-in's profitable?

The containers are usually fairly high in price and like Sandy said.....there are bound to be ones that sit on the shelf because they just did not sell.....so that knocks that one out......
The amount and variety of flowers needed on a daily basis to fill any order that might come in to specifications......no way to keep that many and that much of variety on hand......so that knocks that out,
It takes time to look up each recipe as it come in either in a workbook, poster, or online....( I think I counted at least 7 different TF-WEB books alone - so you have to know in which book is the arrangement on order......so that knocks that out of contention..............

Not to mention things like staffing, delivery, dconns, asks, cons, dens, and all the communications that go on.........

So what else could there be that would make wire-ins profitable?

I sure can't figure it out.

Hi Ricky-
To answer your question, I can tell you what we do, but preface that this is what works for us in our particular situation in our particular marketplace.

We are able to be profitable with incomings by being selective. We have a high minimum and do not accept most recipe or any codified orders. This way, we can fill orders with the flowers and vase of our choosing. So, I always fill orders to full value, but might use flowers I know I got at a better price and have a better markup on. I do not markup my flowers with a straight across the board markup structure.

For us, incomings are a way to showcase our unique designs to new customers. We have garnered and retained ALOT of new customers who were recipients of our flowers through an incoming order. So, to answer the original question, yes, for us, 30% of something is sometimes better than 100% of nothing because we have made a new customer for life, and the lifetime value of that customer is worth more than 30% of that order.

We are also very careful about watching the fees we pay to the wire service and make sure we are always negotiating with them to get the best possible rates. We keep our fees to bare bone minimums by not signing on with any of their programs. Plus, the fee we pay to the wire service is a heck of a lot cheaper than other forms of advertising we have tried, and the results, for us, as far as getting into new customers' homes and retaining them as customers, are much better.

If we did just incomings all day long, yes, it would be difficult to be profitable, but keeping incomings to only a small percentage of our business helps to balance the overall margins.

 

[kt4ye]

Could that be the missing difference?

You earn your second cigar!

To use an analogy, in the restauraunt business, portion control is a major key to profitability. In the best chains, everything on the menue is specified by quantity and is measured and meticulously followed.

In our business, one of the biggest design room problems is stuffing. The only way to eliminate stuffing is to make sure that recipes are 100% followed.

Bill

 

[RWK]

Thanks for the cigars Bill.....only one problem....I don't smoke. lol

Now.....if it was a big, decadent, slice of chocolate cheesecake with chocalate frosting, and chocolate chips garnishing.....then I'd be all over that sucker.

 

[kt4ye]

Thanks for the cigars Bill.....only one problem....I don't smoke. lol

Now.....if it was a big, decadent, slice of chocolate cheesecake with chocalate frosting, and chocolate chips garnishing.....then I'd be all over that sucker.

OK... Decadent chocolate cheesecake cigars!

Just don't inhale!

 

[Mark Anderson]

Mark - I too sometimes worry about the newbies here that take that blind often irrational anti-wire passion as gospel. It is a prevailing topic here and every bit as wrong as "everybody should fill more incoming"

I think we found our common ground buddy.

When I see an argument like:

30% of something is better than 0% of nothing

THEREFORE pursue more incoming

It scares me because it is so general. You described joining five wire services as idiotic but if the argument really is as simple as it was laid out above joining every wire service that could generate orders is the only thing that would make sense.

Like you said everybody comes to a thread with their own ideas already established. I see one thing (a blanket statement that more services and incoming are better) you see another (the statement all incoming are bad).

It is interesting that you see a prevalent anti-incoming sentiment on FlowerChat - to me it seems just the opposite. We are probably both more interested in views that differ from our own and pay more attention to those posts accordingly.

And one last time I would like to apologize if I have disparaged any consultant. That was not my intention! Based on repeated comments I thought I had an understanding of their basic message - I see now that I did not.

 

[Mikey the Flower Guy]

are we at this again??.....what year is it tomorrow??....

 

[bloomz]

It was all about me Mark.

Isn't everything???:bangles:lol:sofa:

 

[CHR]

I feel a Kumbaya in the air.

(Added: Or not)

Mark - thank you for your intellectual approach to this discussion. Learned a few new things and had to Google them to boot.

 

[Mikey the Flower Guy]

I feel a Kumbaya in the air.

(Added: Or not)

Mark - thank you for your intellectual approach to this discussion. Learned a few new things and had to Google them to boot.

Mark...thanks from Mikey too!!