Local florists blame fees, wire services for wilting bottom line
Posted November 10, 2015
Updated November 11, 2015
Raleigh, N.C. — Local florists are going out of business at an accelerated rate across the Triangle and around the country.
Ed Carpp and his wife took over Watkins Flowers of Distinction, a certified FTD (Florists' Transworld Delivery) florist on Capital Boulevard in Raleigh, two years ago.
"During the busy holidays we would literally have to cut the machines off that were sending the order to us because we could not fill them because there were so many," he said.
The Carpp’s had plenty of orders, but they did not seem to be making money.
According to Carpp, a segment of the industry designed to help local florists began putting them under.
"At the end of every month, we saw a little bit less in the pot to pay the bills, so you are left scratching your head, wondering what the heck is going on," Carpp said.
As the bottom line continued to wilt, Carpp and his wife hired an accounting firm to take a closer look at the books.
"What they found is that we were losing money on every order that went out the door," he said.
Carrp said the fees, including services like FTD, a floral wire service, retailer and wholesaler, are to blame for the lack of profit.
"We were looking at a 20 percent commission on every order, 9 percent clearinghouse fees and 25 percent are fees that we just have to pay them every month," he said.
While some of the fees are consistent every month, Carpp said it drives down what the florist can actually make from doing business with FTD.
FTD disagrees, and said the company transformed the flower business.
"FTD transformed the flower business more than 100 years ago and continues to set the standard in floral related products and services today. As with most industries, the floral business has its own unique challenges, including heightened competition from supermarkets and mass merchants. Floral consumer behavior continues to shift to online buying. FTD membership is voluntary and provides a suite of services and products to help florists manage their businesses, with broad benefits," the company said in a statement to WRAL News.
But as wire services continue to cut into the bottom line, some businesses are dying faster than the flowers they deliver.
According to the U.S. Census, in 2007 there were about 26,000 florists. In 2012, there were about 14,000.
"The local florist is being squeezed to the point that they may not exist in another 20 years," said Sally Carpp.
Cydney Davis-English, a third-generation florist and owner of The English Garden in Raleigh, said she stopped doing business with all of the wire services, except Teleflora, a company that works alongside local florists.
"Every order that comes through our door and every order that goes out is very special to us, but it also has to be profitable," she said.
Carpp said he recently had to end the decades-old relationship between Watkins and FTD. Cutting ties resulted in cutting nearly half the staff, but the owners have a new business plan – distinguish. He hopes the plan will help his shop blossom again.