To Be or Not To Be, That IS the Question

[Dorothy]

I was following a thread, that I unfortunately did not subscribe to, and can't find it now because I don't remember the title...and maybe no one has responded recently so it's "not up there" in the forum feed. Of course it was regarding WS and all the debate around all that.

The thought/question I wanted to pose is this:

Why should every day, regular florist business owners be faced with the ultimatium of opting In or Out of the WS? Why isn't this ultimatium presented to the OGs, whether they're DOGs or HOGs? As I see it, they are the ones benefitting the most from all the mass advertising done by TF, FTD, 800 and ProFlowers, which each and every member of the WSs pays for.

In fact, I'd like to see the OGs, DOGs and HOGs forced to use their OWN credit cards to send orders out. They're the ones with the Big Bucks, aren't they?

As I see it, this is the #1 reason why actual florists don't just Opt Out. It's a real barrier, especially in these economic times. The WS was originally designed to help florists connect and get their in-store customer order requests fulfilled in the most expedient and cost-effective way possible (before the advent of the Internet) florist to florist. But now those two reasons are the lowest considerations on the totem pole. Why? Because the OGs, DOGs and HOGs have taken over the system and the WS are enabling them to do just that.

Until the WSs fix this mistake, we will continue to have the ongoing debate about the pros and cons of belonging to the WS.

Meanwhile, I believe florists should be able to talk about this issue here on FC, when the time is right for him/her. So, I would hope that those with strong beliefs on either side of this debate will allow others, especially the newcomers to this forum, express their views and experiences without feeling immediately shut down and out by those who have the loudest voices and the most time to expend on this debate.

http://www.youtube.com/watch?v=4oZYqAeIdYk

Defending or disputing the merits of WS in the first place is unnecessary. The point is what to do about Your Situation. FC is a great place to talk about experiences and ideas. Let's NOT, purposefully or not, stifle that enthusiasm or energy.

 

[TOTO]

Ah Shucks Dorothy!

Some of us OLD SALTS were just trying to help some of the NEWBIES avoid falling into the MULTI WS TRAP!

Enthusiam is a wonderful attribute, especially when one is young, inexperienced, and impressionable.

It all looks great, which is what all the WS's take advantage off.

The NEWBIE wants to be a member of all of them because they're told, they will MAKE MONEY and NEW CUSTOMERS with all of them.

After that, it's the old LOCK THE NEWBIE IN THE WS POS TECHNOLOGY, LOCK THEM INTO THEIR CREDIT CARD PROCESSOR, buy into all those ALSO SERVED BYS, buy into all of those TIE IN ADS, buy into all of those CHACKA containers, magazines, and any other OPTIONAL ADD ON SERVICE they can sell to them, and then, VOILA.

The NEWBIE can't figure out where all of their money is going and why they're not making a profit after DOO-ING ALL THOSE HIGHLY DISCOUNTED ORDERS. Finally, all their enthusiam is gone and they find themselves in a spin their wheels for naught TWILIGHT ZONE because no other REAL FLORISTS imparted their past experiences to them.

And, this is a PRO REAL FLORIST POST versus a WS BASHING AGENDA!

They are what they are, and WEE BEE WHAT WEE BEE!

 

[Dorothy]

It all looks great, which is what all the WS's take advantage off.

Let's talk about that then? And, maybe by talking about it, we might be able to come up with some REAL solutions/alternatives...focusing on the b&m shop. It's all great for the big boys/players who have learned all this stuff and figured it out, so why not share...in detail? Without *putting anyone down* in the process - not that you do that Toto! Your name is the ONLY reason I once in a while *think* about getting a dog....I'm a CAT person.

 

[Dorothy]

Oh, Toto, BTW I thought about you when I heard this song, in of all things a newcast, the other day (things always have a way of coming around full circle, eh?) http://www.youtube.com/watch?v=aCca5mPMp9A

 

[Bigted]

Dorothy, the economics of the situation are pretty simple. The WS need orders to keep things going and the OGs are an efficient way to get them. If they are not compensated adequately, they will go to the other WS (although Blooms today apparently couldn't cut off FTD completely).

Anyhoo, the filling florist has very little leverage. They want orders so they keep filling, even if they know it hurts them in the long run. The fillers have a little more leverage in small towns, and that's why you see direct ship becoming more of an issue.

It is clear and encouraging that more and more consumers are going direct to the local florist, but there will always be a giant hunk for the OGs.

 

[RWK]

In re-building this Why or Why Not thread - It might be a good idea to take each Wire Service individually and expound/talk about the advantages and disadvantages of each.

The Big Three at the Moment are FTD and it's affliates, Teleflora and it's affliates, Bloomnet/Bloomlink and it's affliates.

FTD - includes FTDI, FTD.com. 800-SEND-FTD, and any remants of FTDA

Teleflora - Teleflora.com

Bloomnet - Bloomlink, 1-800-Flowers, 1-800-Flowers.com

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It is simply a matter of picking one to start with and expounding on just that one.
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As a matter of fact, I don't recall EVER seeing a side-by-side comparison of all the wire services......the good and the bad.



You could even include the more exclusive service - BBrooks ( which I know very little about )

 

[Lady Biker Florist]

I was a longtime member of FTD until a few years ago. On and off again with them ever since. I was a TF member on and off throughout our many years. Others also that are now nonexistent. Upon learning here at Flowerchat and even before that at Floristboard I did my own math and discovered we were not really making anything much by belonging to either of the big two. I had already quit TF and decided to also quit FTD. Stayed like this for a couple or few years. I did join Florists' Interlink (my personal favorite in the minor league if you definitely want to use a wire service to send orders out and get the 80/20 discount without using your own credit card) and that was completely sufficient.

Well, the one thing that has not been discussed yet is that the big two offer promo after promo to get you back or to join new. I rejoined TF and FTD twice in the last two years. All at no fees. To me that was a no-brainer. I knew exactly when I had to quit by to avoid fees and I did. One month later I was back in due to another promo offer. I will be with TF until June 30th. I did however agree to a $99.00 a month fee total with FTD for up to a year. We're high on a list for incoming orders with ftd.com and we do get more than we ever have before on a regular basis. Mother's day was about double what we normally do in a month.

These promo offers are constant and I doubt they will let down or go away. This has to fit in with this thread somehow, don't you think?

Now after all I just said, this is our new perspective. The busyness of Mother's Day was more like an illusion. We had to buy a lot more flowers than normal. Pay more delivery since more to deliver. More gas. Two people walked out Sat/Sun as I had to make the arr's so they could be delivered so could not help wait on the people in our store thus loosing 100% paying customers and probably any future with them. The vast majority of the FTD orders were for specific recipes. I was able to sub quite well but there is no way to stop and figure it all out to make sure you are not losing money. Plus if you make it with less flowers than the pic they selected you always risk complaints. Don't want to go there. There's more, but seriously - wire ins and busyness is really just one grand illusion.

It reminded me of years ago when we always had lots of wire ins and always hired so many extra people. I never did the math back then, but I am sure it was the same then as it was this past Mother's Day. Yes, it FEELS good to be busy and experience the impression that you are successful and all that - but again I will admit and proclaim - IT'S A GRAND ILLUSION!:tread:


It was not worth the insanity we went through to fill these dotcom orders.

My take on it is this: I am paying FTD $100.00 a month. Why not use that same $100.00 and use it to market to my own already existing customers. We're small enough I could go through my database of purchasers/orders and hand pick a few hundred people to send a postcard to. I have a ton of very pretty John Henry postcards I got free as they sent the wrong holiday one time. I can print them myself. How ever many postcard stamps I can buy for $100.00 - Voila! Hundred percent paying customers. If I only got as many orders as I got wire in orders this year I'd be ahead since I am getting all of their money other than the $100.00 it cost me initially.

Thanks for allowing me to share my thoughts, experience and idea.
:bouquet: :scooter: Flowers for all and still riding for Jesus!

 

[TOTO]

Great, but I like "MY WAY!"

Oh, Toto, BTW I thought about you when I heard this song, in of all things a newcast, the other day (things always have a way of coming around full circle, eh?) http://www.youtube.com/watch?v=aCca5mPMp9A

Thanks Dorothy!

Now here's one back at you!

It's our own son Michael, singing his version of the Frank Sinatra hit, "MY WAY"

http://www.youtube.com/watch?v=3lxALg6cwFE

That pretty much encapsulates my life as a REAL FLORIST for the past 40 years, plus another 2 working as an apprentice.

This subject regarding the PROS or CONS of the WS's as either one's partner or competitor, will go on till the end of time, either ours or theirs.

The only answer for every REAL FLORIST is in crunching the numbers to get to their bottom line reality check. Cathy's (CHR) WS profitability calculator is a MUST USE TOOL, especially for our NEWBIES.

http://www.flowerchat.com/forums/showthread.php?t=4289&highlight=calculator

They can download it and enter in their choice of WS's doing a look back over a 12 month period, and as long as they input their REAL NUMBERS, the end result will either prove, or disapprove the WS MYTH.

I did that back in 1984 with Lotus, and it proved to me, the fact that, a REAL FLORIST can only ever make a profit by having ONE WIRE SERVICE and only when they're SENDING OUT more orders than they are FILLING!

Best case scenario, and a reality which, all of the dOG's, OG's, and non-local phony middlemen order brokers eventually discovered for themselves, is when they SEND OUT ORDERS ONLY and never have to fill any. That's where all of the CREAM is gathered and after they've managed to SKIM that off the top, what's left for the filling florists winds up to be much adieu about nothing.

 

[TOTO]

YUP! Same conclusion over the delusion!

Now after all I just said, this is our new perspective. The busyness of Mother's Day was more like an illusion. We had to buy a lot more flowers than normal. Pay more delivery since more to deliver. More gas. Two people walked out Sat/Sun as I had to make the arr's so they could be delivered so could not help wait on the people in our store thus loosing 100% paying customers and probably any future with them. The vast majority of the FTD orders were for specific recipes. I was able to sub quite well but there is no way to stop and figure it all out to make sure you are not losing money. Plus if you make it with less flowers than the pic they selected you always risk complaints. Don't want to go there. There's more, but seriously - wire ins and busyness is really just one grand illusion.

It reminded me of years ago when we always had lots of wire ins and always hired so many extra people. I never did the math back then, but I am sure it was the same then as it was this past Mother's Day. Yes, it FEELS good to be busy and experience the impression that you are successful and all that - but again I will admit and proclaim - IT'S A GRAND ILLUSION!:tread:

It was not worth the insanity we went through to fill these dotcom orders.

My take on it is this: I am paying FTD $100.00 a month. Why not use that same $100.00 and use it to market to my own already existing customers. We're small enough I could go through my database of purchasers/orders and hand pick a few hundred people to send a postcard to. I have a ton of very pretty John Henry postcards I got free as they sent the wrong holiday one time. I can print them myself. How ever many postcard stamps I can buy for $100.00 - Voila! Hundred percent paying customers. If I only got as many orders as I got wire in orders this year I'd be ahead since I am getting all of their money other than the $100.00 it cost me initially.

Thanks for allowing me to share my thoughts, experience and idea.
:bouquet: :scooter: Flowers for all and still riding for Jesus!

We eventually came to the same conclusion that, filling all those highly discounted DOT.CON orders, especially at PEAK PERIODS was a BROKEN COG in our WHEELS.

Same reality was discovered by many other REAL FLORIST friends of mine over the years, which caused them to eventually OPT OUT!

One REAL FLORIST friend, and after crunching the numbers over several floral holidays, realised that, he could make the same net profit by filling ONE 100% SALE from his own customers as compared to filling TEN DOT.CON orders for the middlemen.

The only change in your post I would dare to make is from GRAND ILLUSION to GRAND DELUSION, since having been there, did that too, back in the day, I had deluded myself into believing that, IT WAS ALL GOOD and we could doo it all.

Still can't figure out why I thought that way and how stupid we were to actually put our Telephones on MAKE BUSY just so that we could get a handle on trying to catch up with all of those DOT.CON holiday orders.

Finally realised that was their GRAND DELUSION since, if our customers couldn't get through to us when they needed us the most, their plan B was to call our DOT.CON competitors, and sneak it through our back door, albeit SKIMMED with no money for our delivery $ervice.

This Mother's Day was smooth as silk and not one customer complaint.

Now that's what we should all be taking about!

 

[pnyflr]

I know that this gets to be a heated debate by those who choose to be a WS and those who don't, and I don't really want to start an argument. BUT, all this discussion was making me paranoid that my way of doing the math to see if we make money off of our membership was wrong.

So, I used the calculator you provided and put in my numbers for the first four months of this year for TF, and we make on average a $400 profit from being a member each month. Now, is it really profit, no, as I use that $400 to pay my rent, utilities, etc. Without the service, I would have to find a way to sell an additional $800 in arrangements each month with no additional expenses to earn the same contribution to margin. I am a really small shop in a little town in Nebraska, and we sent a total of 59 orders out in the first 4 months of the year. I don't participate in the rebate program for sending as I don't send enough to qualify. So, we are considered a recieving shop, and we make money doing it.

Glad I went through the exercise so that I can go through the next 4 months of slooooowwwww time with the knowledge that it does pay for us to be a member.

 

[mcf]

I don't participate in the rebate program for sending as I don't send enough to qualify.

Are you sure about this? I didn't realize you had to send a minimum amount of orders each month to receive a rebate. If it's true..that's a rip off!!!

 

[TOTO]

Good start, but wait till the finish line.

I know that this gets to be a heated debate by those who choose to be a WS and those who don't, and I don't really want to start an argument. BUT, all this discussion was making me paranoid that my way of doing the math to see if we make money off of our membership was wrong.

So, I used the calculator you provided and put in my numbers for the first four months of this year for TF, and we make on average a $400 profit from being a member each month. Now, is it really profit, no, as I use that $400 to pay my rent, utilities, etc. Without the service, I would have to find a way to sell an additional $800 in arrangements each month with no additional expenses to earn the same contribution to margin. I am a really small shop in a little town in Nebraska, and we sent a total of 59 orders out in the first 4 months of the year. I don't participate in the rebate program for sending as I don't send enough to qualify. So, we are considered a recieving shop, and we make money doing it.

Glad I went through the exercise so that I can go through the next 4 months of slooooowwwww time with the knowledge that it does pay for us to be a member.

Using CHR's calculator is the ONLY WAY to get to the truth!

The first 4 months of the year is a start, but unless you factor in the full 12 months of the year, you can't get to the finish line.

As long as you entered in all of their DEBITS, CREDITS, and deducted the 20% sending commission, the 7% clearinghouse fee, the 3% reverse the incoming order's transmission fee, and your actual costs of making all those deliveries, you should reach a real bottom line figure, either a profit or a loss.

CHR and others like MEE, seem to arrive at a TRUE DISCOUNT of from 45% to 50% per incoming order when factoring in all of the WS's costs over a 12 month period. The only areas which can change those results are from your PROFITABLE SIDE of the sending spectrum.

With your earned sending commissions coupled with your earned rebates, those can reduce your losses.

However, I'm still of the opinion that, it's a COST SHIFTING accounting ploy since, one could keep more, if not ALL of those profits from the outbound side by reducing their cost exposures at the filling side.

 

[lori042499]

Are you sure about this? I didn't realize you had to send a minimum amount of orders each month to receive a rebate. If it's true..that's a rip off!!!

Yes, I believe it is 20 orders, or something to that effect.

 

[BOSS]

Anyhoo, the filling florist has very little leverage.

I disagree... who was it... Nancy I believe... JUST SAY NO!

If every florist did just that for June-July-August, FTD and 800Flowers would go out of business! And no matter what anyone says, those orders would return to the local florist for fulfillment.

They want orders so they keep filling, even if they know it hurts them in the long run.

Sick ain't it... addictive personalities and all, kinda like Flower Crack...

It is clear and encouraging that more and more consumers are going direct to the local florist,

Thank God.... and every local florist that's dooing the DOO!

but there will always be a giant hunk for the OGs.

Um...maybe... see first comment...

 

[pnyflr]

Did 2008 full year, and I still made money. Yeah ME! I know it doesn't work for everyone, and we ALL need to run our own numbers so we can make an informed decision on how it impacts us...and I will be doing this on a routine basis as this business always changes. So, thanks for the discussion of the topic.

 

[bloomz]

I'm afraid that I have to inform you that it is some form of blasphemy to claim to make money from wire services up in here....

It's just not allowed.

Now you have to got sit in the corner and write on the blackboard 500 times

I hate wire services they are evil...
I hate wire services they are evil...
I hate wire services they are evil...
I hate wire services they are evil...
I hate wire services they are evil...
I hate wire services...
I hate wire services...
I hate wire services...

 

[RWK]

I don't deny that there are some florists who somehow have figured out how to make incoming wire orders pay off - I have said it several times, but this past Mother's Day - I freelanced at a shop that goes after the big three incoming orders..........I would estimate that less than 10 percent of the orders were for something other than an advertised wire special or branded wire arrangement.

For the life of me, I can't understand how they make it work.....unless it is sheer volume that makes the difference.

However, me being the contrarian that I am, as well as the hell of an independent spirit, I know wire services and their 'rules' just would not work for me.