Industry Leaders Discuss Holiday Supply Chain - safnow.org

The first few days of April brought signs that demand is beginning to pick up along the floral industry supply chain — a potentially encouraging indicator ahead of a major holiday that will be anything but business as usual, even for florists who can offer select services.

“Two weeks ago, we ran trucks out of Florida, but we had almost no volume at all,” said David Armellini of blankArmellini Logistics in Miami during “Fresh Product Supply Update,” an April 9 Society of American Florists’ webinar. “Then it jumped 50 percent.” At first it wasn’t clear if the boost came only from Easter sales, but the following week, volume was up roughly 22 percent over the week before.

As of April 9, about 60 percent of Armellini’s customers (mostly wholesale florists) were using the company’s services, reported Armellini, a former member of SAF’s Wholesalers Council: “Every day we’re getting phone calls from people opening back up. Momentum and volume are continuing to rise.”

Easter may have kick-started an awareness of the potential for missed opportunities. “The demand from the end consumer caught retailers off guard,” said SAF Chairman Bill LaFever, PFCI, of Bill Doran Company in Rockford, Illinois. “We brought in product, it sold quickly. Pre-orders were much smaller than was needed. There weren’t as many flowers in the pipeline, whether being boxed in South America or on planes or trucks.”

So, what is the prognosis for Mother’s Day? LaFever is getting more optimistic as time goes on: “Even as early as , I was thinking maybe 50 percent. But based on the trajectory from Monday until now, I would think we’re looking at least 75 percent of a traditional Mother’s Day.”

Armellini threw out an estimate of 65 percent of normal volume. He noted, however, that his wholesale florist customers make predictions ranging from 20 percent to “better than last year.” He believes that as many as ten wholesalers who were closed this week plan on opening up next week (starting April 13) in order to be ready for Mother’s Day.

At Sun Valley Floral Farms in Arcata, California, SAF Growers Council Member Rodi Groot sees the possibility of a big uplift from last year for floral deliveries at Mother’s Day, given that so many people will be unable to visit their mothers at home or go out to restaurants.

Thinking Ahead

The crystal ball remains foggy, said Oscar Fernandez of Equiflor-Rio Roses in Miami. Flower farms in Colombia and Ecuador have been functioning with reduced staffing, in part because of curfews and other regulations regarding social distancing. When demand began to resurface around April 1, they were fortunately able to make the adjustments necessary to meet it rather quickly.

“The flowers can be there ready to be cut, but we also need to make sure the people are there ready to harvest and process them and get to the airport,” said Fernandez, a member of SAF’s board of directors.

Those types of adjustments will be needed all along the chain as the demand curve shifts. With fewer workers, fewer flights, fewer trucks on the road, and fewer hours of service from wholesale florists, suppliers have to make calculations — mostly guesswork — that weren’t necessary in the past.

Shipping logistics will be amped up compared to current levels but will remain less than normal for the holiday. On the wholesale florist end, LaFever agreed with Armellini that about 75 percent of wholesale florists could be open by April 13 and probably 90 percent by the end of that week. He cautioned, however, that “open” means with limited hours and deliveries.

The best strategy for retailers? Plan, communicate, and order as early as you can. “Don’t wait until a Friday to call Oscar or Bill and say, ‘I’m going to need this next week,’” said Armellini. Farms will have flowers, but they won’t be able to get them into the pipeline for orders that come too late.

By pre-booking, you will be doing yourself and your supplier a favor, these supply-chain experts agreed. “Pre-books are the holy grail right now,” said LaFever—adding that it can still be helpful to let your supplier know, “This is what I need for sure, and I’m thinking that I may need an additional 10 percent for these specific items.”

It’s easier for growers to scale down than to ramp up, added Groot: “We are going to guide our customers to plan for the best.”

Now is when the relationship you may have with a long-term supplier comes to bear — especially when it comes to credit, since everyone in the chain is likely to be experiencing cash-flow challenges. “A brand-new supplier is not going to extend credit,” said LaFever. “But if you have that history with your supplier, deferred payment plans might be available. Have the communication.”

In answer to questions from webinar participants, the panelists noted that supply for the holiday is not limited to staples; specialty flowers and novelties can also be available. “But those items may not be just sitting there in the pipeline,” LaFever noted. Here especially, lead time is crucial.

Winning over Uncertainty

Despite promising signs, uncertain demand remains the roadblock and bugaboo of the Mother’s Day market. For wholesale florists, much of the initial confusion over whether or under what conditions they can legally be open to receive deliveries has been cleared up, said Armellini. But: “We need the retail side to be open, and they need the demand to be there.” (SAF has resources for florists struggling to understand their state rules and also has covered the difficult decisions retailers face in deciding whether to close their operations when a clear mandate is not in place.)

Whether as a retailer you should be open or closed — not for in-store sales, of course, in most places, but for contact-free deliveries — remains a difficult and personal decision, with very different factors at play for each individual florist, noted SAF CEO Kate Penn. “We can help people make that decision,” with resources including those available on the SAF website.

As a bright spot in the current landscape, LaFever praised the creativity of retail florists, as they promote the safety and health benefits of flowers online (with Facebook Live events, for example) and in their local news markets. “On the other side of this, there will be a sense of community developed,” he observed. “I’m very hopeful for retail florists who have engaged on that level.”

Tools for doing just that are among the resources on the SAF website, including via recent webinars on Mother’s Day Planning and Social Media Strategies during COVID-19.

Bruce Wright is a contributing writer for the Society of American Florists.

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