Charting a Successful Course for 4Q 2023

Episode 194: In this episode Vonda takes the reins solo while Lori is away.  She will explore key insights and practical tips to help you navigate the rest of 2023 with confidence.

Join her as she guides you as to what you can expect for your business in the upcoming months and how to effectively plan for success. We delve into the critical question of when and how to forecast your sales and determine if your business needs to hire additional staff, to ensuring you make informed decisions.

Tune in to gain valuable perspectives on strategic planning, set your business up for growth and success. 

Sponsored by:
Flower Clique
Flower Clique Prep School
Real Life Retail Florist

Transcript

SPEAKER_01 0:03

The question we're talking about today and about our business belongs to the microeconomics branch. And that is, what should I do about business this fall? Can I hire someone? Welcome to the business and pleasure of flowers. We're your hosts, Vonda LaFever and Lori Wilson.

SPEAKER_00 0:23

And we believe that business and fun are a perfect combination. Kind of like us, Vonda.

SPEAKER_01 0:31

Hey clickers. I just returned from the Society of American Florida Convention in Phoenix. I know I saw a lot of you there. There was so much great networking, education, and enthusiasm. A lot of fun. But I'm flying solo here today. Phew, you know? Lori's on a little road trip today. We were in Phoenix. She decided that she would just go ahead and rent a car and drive over to see her uncle and some relatives. I'm so happy she could do that. Unfortunately, you just have the business side of the business and pleasure here today. That's why I say I'm flying solo. That's a story in itself, which I'll share with you a bit later. It was a great week in Phoenix, a long week for sure. One thing I want to talk about today is when you own your own business, you have to have a pulse on what's happening in our industry, which we really did get there, but also know what's happening inside your business. And that's what I want to talk about. As the owner of FlowerClick, it's really no difference. So Ellie, Lori, Cammy, and I went in a day early to Phoenix for planning for FlowerClick. From the launch of FlowerClick in 2020 till now, our amazing team has not taken our eyes off of the growth and efforts going towards our goal, which is to provide tools and services to help shops elevate and grow their business. I mean, it's kind of our mission statement. Much like you, we've got to pause and take a look at the business overall. What we're doing now, what we're doing right, and what we can do better. So Ellie had us break it down to picture, people, planning, big picture, the people, and the planning. So the big picture is what we do now, what services we offer from OneClick, which is our web program, to ClickMeal, our email marketing, our prep schools, flower prep, sales prep, sympathy prep, as well as real life retail florist course, which is a course that has everything you need to know to start and operate a successful flower business. So that's what we did on the big picture. Then we went on to people. What we try to do, and I think this is a great idea for anyone who has a business, because we all operate best when we're doing things that we enjoy doing, right? So we go, what is our red, our yellow, and our green? So the red is the things you don't like to do. And you just can't seem to get them done because they get put on the back burner. The yellow are okay. You know, I don't mind doing them, but it's not my favorite. I can get through it. And then the green. The green is go, obviously. And so it's those things that you love to do when you can get them done the most efficient way, right? Sometimes, however, greens are not the most efficient. You might really like to do them, but there might be somebody who does it more effectively and efficiently than you. And so sometimes a green needs to be moved over to somebody else who could do it in a faster, more efficient way. You have to take the reds, the greens, and the yellows, and maybe take an opportunity to turn the red into a yellow. What can be done to do that? Maybe it's automation, maybe it's delegation. Yellows are usually pretty okay unless you find somebody who says, you know what, I really like to do that, and we'll take it away from you. That's okay too. And then the greens, how can you be even more productive if it's a green that you're a little bit slower on and move faster and more efficiently? We really have the goal of taking good, better, best. I know I've shared this many times before, and it it was actually at Ellie's graduation at Iowa State University from the design school. Good, better, best. Never let it rest until the good is better and the better is best. That's what we continually strive to do. And the third part of that was planning. It's always exciting to walk away from any type of meeting with a clear vision and a plan. We took a deep dive into a lot of things, and we'll do that even more with the rest of our team between now and the end of the year, because we're going to look at or create opportunities for 2024. What I know is FlowerClick was created to give a solution to a challenge that most business owners face. Flower shop owners face every day. So much to do, so little time to get it done. It's a continual goal to get the message out and to assist as many flower shops as we can to keep this industry thriving. In these past few weeks, I've been on the phone making calls to hear successes and challenges of flower shop owners. Many of you would call these cold calls, right? I'm just reaching out. I prefer to call them getting a pulse on the local flower shop and to see if what we do at Flower Clook is part of a solution to a challenge they have or not. As we move into the fall, many businesses are looking forward to increasing sales, right? The flora industry is no exception. The summer business at most flower shops experience was actually summer again. Remember back to the time when it was slow? Let's go back to 2018, 2019, and all the years before that, unless, of course, you're a big wedding shop. It was a time you could catch your breath, walk away from the shop, and knowing it's okay. Actually enjoy some downtime, but worry a little bit, as we always do, that business is slow. Always in the back of your mind going, but it's gonna pick up. It was a time to clean, organize the shop, whether it's ribbon or those miscellaneous storage spots. Oftentimes we would shut down and scrub out the cooler, and then we pull out the fall and the Christmas merchandise out of storage and get organized for the rest of the year. Sound familiar? Many shops I talked to actually had that summer and did all of those things again. Today I'm going to address a concern I've heard repeatedly for the last few months. Understandably so. What should we expect for fourth quarter of 2023? Fall, Christmas, can I and should I hire someone for the season? That's a really good question. Kate Penn, the CEO of SAF, said that this year has been unpredictable. Labor is the number one challenge. There were many industry committee meetings, and one group's outcome, as presented by Marlon Hargrove, was flat is the new up. Great. That really didn't answer my questions. Before I went to SAF, I went down this little rabbit trail of my own trying to figure out what to expect. Yep, did that. Took a while, too. All over the internet, there's so many economic predictions, investment groups, who are happy to give you their opinion. And then I found this, which I thought was pretty interesting. Contrary to the confident sounding claims of experts in the media, economists cannot accurately predict the macroeconomy. Economists have an awful record in forecasting inflation, interest rates, gross domestic product, and other macro variables. And that was by the Cato Institute. Macroeconomics, which they're having a hard time predicting, is the study of the economy as a whole. Well, that would be a little bit difficult to do, right? That's the large-scale general economic factors in this whole world and how they interact with the economies. Then we go to microeconomics. So let's bring it down. It's the study of how firms and households make decisions. Some examples of this would be how a local business decides to allocate their funds, how a city decides to spend a government surplus, the housing market and a particular city or neighborhood. Microeconomics is what affects you and me and our businesses, us as individuals and as an industry. An example I thought of for us, right? All of us in this industry is cutting some costs in order to maximize profit. That would be a micro decision that we could make. Or possibly it's a decision on a business that they need to add services to help their business, which is investing in itself. The question we're talking about today and about our business belongs to the microeconomics branch. And that is, what should I do about business this fall? Can I hire someone? The reason that I think it's important that we know the difference between these is one we can control and one we can't, right? The news is distracting. It can be depressing. It can cause us to react in a way that's not beneficial to our business and quite honestly stifle our growth. I'm not saying go full speed ahead. I'm saying look at your business and what's happening in your market and make a decision based on your data. Okay? So I want you to look at your data. Warren Buffett has been quoted many times by saying it's been an incredible period for the economy, but that's coming to an end. That incredible period was, as you know, the pandemic. The reason that's important is that we can't forecast our needs for the fourth quarter of this year, moving forward, on numbers from the last two years. I'm going to encourage you to look at 2019. Now I've been saying this for over a year now, and that's the same thing that Kate Penn talked about from the stage at SAF. And we just all looked at each other and said, yes, that's that's where we are too. So that's great. We're all on the same page. Most of our Flower Click members have used those numbers for forecasting for this whole year. And in most cases, it's been pretty close. I've had several members, like Jennifer, who I was just working with last week, and she's been tracking those numbers, and she said hers are up just a bit from 2019. And Ralph Giordano from Giordano's Floral Creations in Florida sent me some reports from his sales from 2019 compared to 2023, like year to date. And then also from 2022 to 2023. Interesting enough, from 2019 to 2023, Ralph is up 27%. Wow, that's really good. Then you look at 2022 to 2023, and he's down 8%, which go back to what Marlon Hargrove expressed during that meeting is flat is the new up, right? Although Ralph is up 27% from one year to the other, that looks fantastic. But then you can kind of get a little bit depressed when you're like, ooh, man, I was down 8%. Why this is so important is it's about the mindset. And you hear Lori and I discuss this over and over again about your mindset. Think about this. Down is discouraging, up is uplifting. So again, go back to what we're saying. You were down from one year to the other. So that can be discouraging. But when you look how far you were up from 2019 to 2023, oh my gosh, you know, that's really good. In a time when labor is really the number one challenge, determine if you need an employee or just want one. As we all know, there's a huge difference. Now, this is really a three-step process. Remember, numbers don't lie. These are your microeconomics right there in your own store. Number one, pull sales numbers. If you can do a sales comparison report, and you can do usually that in a PL, a profit and loss statement, or if you have the DevPOS, it's called a sales-by-product comparison report. That one works really well. So compare the dates from January to August of 2022 to the date of January through August 2023. They'll give you two different columns. It will give you the numbers that you're looking for. Now then I want you to do the same with 2019 to 2023. Now, this is the number that's going to be most important to forecast those sales. The one is going to give you an idea of where you were just recently. The other one's going to take you back a little bit further and give you those more realistic numbers of 2019. Step number two, pull sales numbers by the month, gross sales for the month of October, November, and December. Okay, so first something's going to show you the trend of one year to another. Next, you're going to just pull the numbers for 2019, October, November, December. Okay, now based on the trend you saw from the 2019 to 2023 earlier, you can see if it was a monthly increase, decrease, or you were flat for that period of time. Let's say in my little scenario, I'm going to say that this flower shop does $500,000 a year in sales. And they were up 25% from 2019 to 2023. You know, you might have been flat, but I'm giving you the 25% just because it sounds fantastic and it might not be realistic in many areas, but some I know have experienced that from that amount of time. So if I'm in October, I had $20,000 worth of sales and I'm up 25%, which is an additional $5,000. My sales now for October are $25,000, right? And so on. So typically it would be $35,000 in November, an extra $8,700. And if I truly was at $500,000 a year, almost 20% of my sales happened during the month of December. So I'd be $100,000 and then $25,000 increase. So all of that sounds fantastic, right? And that's going to help you forecast for 2023 and know whether you need to expand your sales staff or in some cases not. Now, step number three, take the 2019 sales numbers by month that we just pulled October, November, December. Do your increase, flat, decrease, whatever your final numbers are that you're forecasting for 2023 and take 30% of that number because 30% is your total payroll budget. When I say total payroll budget, that means paying yourself as well. So anything that has to do with payroll needs to be 30% of those sales. When I'm looking at October at a $25,000 sales, my budget is $7,500 for that month. That's the 30%. I go to November and it's $13,000 and some change. December, my budget would be $37,000. Now, you look at all of that and you want to staff based on the least amount of sales, which would be our October at $7,500. And then increase the hours if you have part-time employees or if you're going to bring in freelance designers, you can increase that in November. Now take a look at your December. 37.5 is a great number. And some of that has already been prepped, right? Some of that are gifts, and maybe you need more sales staff for the front room. Take a look and see how fast your production team can do, what freelancers you can bring in. But typically in December, your payroll budget is much lower than 30%, which is good because people are being actually much more productive. You're selling things that are already produced, a lot of the permanent botanical designs or whatever you're doing in the store. So that is a really high budget, and it is an opportunity for flowershop owners to be able to recoup some of the months that they have put out extra labor time and time again. Those are the numbers to help you forecast on the rest of the year. Those 2019 numbers times either an increase or decrease from whatever you've done for 2023, and then the 30% for your total payroll. Okay? So that will really help you decide whether or not you can have that extra person in your store. Another study that was shared with Society of American Florists where approximately 20% of sales are online. Now that fluctuates a little bit for the floral industry. I mean, I know some that have 10%, others 15, 20%, and there really are some that have close to 30% of their orders that are coming in online. They shared that businesses are finding the most success in three areas using Google AdWords, social media, and making sure they have exceptional customer service. So as the old saying goes, spend money to make money. Google AdWords, if you want to learn something new, this can be accomplished with AI, really, if you want to learn about Google AdWords. Or you could reach out to me with a recommendation. There are some honest, affordable options out there to have somebody help you with that. Social media, as we know, is pretty low cost, time consuming, but low cost. And customer service in your shop takes good leadership, training, and support because we know that customer service equals reviews equals customers. So good shop culture is key with a high percentage of business coming from online sales. I just got to put a plug in here for FlowerClick. It's a good investment. With an increase in your average order and limited and strategic inventory on your website, our members actually say it's a game changer at the way they do their business. You can visit our website at flowerclick.com and scroll down and read some of our testimonials. They can tell the story better than I can. I can just tell you I love what I do, I love what we do. Everyone on my team is a team player and love what we do. And that's lighten the load for flower shop owners. Make shops more profitable and connect like-minded people in a safe environment to learn and grow for all. So I don't want you to sit back, not spend money, and hold on to what you have. I get it. You want to do that, and it's really fear-based. I want to share this advertisement that was in the Sayer, Oklahoma Journal, Little Town Sayre, Oklahoma. If you've been to one of my educational presentations over the years, you maybe have heard this, but it truly does bear repeating. It's called the hot dog vendor. There was a man who lived by the side of the road and sold hot dogs. He sold very good hot dogs. He put up signs along the highway and advertised in the newspaper telling how good they were. He stood on the side of the road and cried, Buy a hot dog, mister, and people bought. He increased his meat and bun orders. He bought a bigger stove to take care of his trade. He finally got his son home from college to help him out. But then something happened. His son said, Father, haven't you been listening to the radio and watching TV? There's a big depression. The foreign situation is terrible. The domestic situation is worse. Whereupon the father thought, Well, my son's been to college and he listens to the radio and watches TV and he ought to know. So the father cut down on his meet and bun order, took down his signs and canceled his newspaper ads and no longer bothered to stand by the side of the highway and sell his hot dogs. And his hot dog sales fell overnight. You're right, son, the father said to the boy. We're certainly in the middle of a Great Depression. What's important to note is that the year this was published was either 1982 or 1983, because those are the years that I lived in Sayre, Oklahoma. It was so impressionable to me that I've kept it for so many years and keep thinking, it doesn't matter what year, we just keep coming back to it, right? We often lose sight of the noise of everyday news and want to pull back. But don't. You've got to move forward. Gotta move forward. I'd stop right there, but I mentioned the flying solo in the beginning, and Lori always makes sure I wrap up by saying what I'm gonna do. So back to flying solo. Many years ago, I wanted to. Be a pilot, you know, private pilot, small engine, airplane. Because my husband had an airplane, and I thought, oh gosh, if something ever happened, I need to be able to land this plane. So that's why I did it, and it was very exciting to me. The very last thing I needed to do was to do another solo, which is all by myself without an instructor in. You do so many hours of instruction and then you do solo flights. And I needed to get a few more in. And so I was doing something called touch and goes, where if you're not familiar with that, it's when you're practicing landings basically. You get down, you touch your wheels on the ground, and then you give it full throttle to take off and go again, and then stay in the pattern. That's what it's called, stay close to the airport, and bring it back around and do another landing. And I thought, you know what? I don't have quite enough time. I'm gonna do one more touch and go because, you know, landings were the hardest part, but they were also, if you know me, the challenge is good. I like that. Our throttle on our airplane is called a push and pull. So you push in this little button and push it in, which makes it go faster. To slow down the airplane, you push the button in and you pull it back and it slows down the airplane, just much like taking your foot off the accelerator. When I went to push the button in and pull it back, the throttle actually has this little screw in it, and the screw came out and went to the back of the airplane. Here I am in the air, going super fast because I cannot pull back the throttle of the airplane. And I thought, okay, I'm good at mechanics, so I'm going to put this back together. So I, you know, hands off, I'm operating my airplane and I'm picking up this throttle and trying to put this little screw back in. And as I did that, it started going faster and faster. So have you ever been in the middle of nowhere and a little bit panicked and not quite sure what to do? That was me. But you'd learn to think on your feet, right? In those cases, like, I can't stay up here forever. So I knew what I needed to do, and that was go back, get in the pattern, and I had to shut the engine off so that I could bring the airplane down. No other way to do it. So I get into my pattern and I try to evaluate how far my airplane will glide to get me where I need to go, which is touching down on that runway. Which I'd say I I did. At a certain point, I'm like, okay, this is it. And I just completely cut the engine, which is just a switch, right? So you just switch off the engine, and you have to know that you've got one shot at this. One shot. And I and I brought it down. I brought down the airplane, landed it well, and taxied it over in front of the hangar, which is like a garage for airplanes, and I walked away, just shaking, just absolutely shaking. But I did it. And what I learned from that is keep your nose up, your wings level, know how to control your speed. Pull back and you'll slow down your nose to the ground and you can accelerate, much like what we do every day. That's all you can do at the time. And you can coast for a long time if that's all you can do. But never, never lose sight of your goal.

SPEAKER_00 25:39

Thank you so much for listening to our podcast. We hope you enjoyed spending time with us because we enjoy spending time with you. If you did, make sure you hit that subscribe button or add the business and pleasure of flowers to your Google morning routine or your flash briefing on Alexa. We look forward to seeing you next week.

SPEAKER_01 26:00

So please come back and join us and discover how a bit of knowledge and one small change in your mindset can take you to new levels in your life and business.