Like a lot of things in our industry, all things business and money are super secretive.
No one wants to talk about making money, do they?
It’s so frustrating.
Because we all run businesses, which, by definition, are set up to make money (no, it’s not the only objective, but making money is an awesome goal) but no one in our industry openly talks about the money side of the puzzle.
For years, I walked around looking for answers and support. I want to save you from all that frustration and exhaustion peoples!
OUR INDUSTRY IS SUPER SECRETIVE
Here’s a fascinating tidbit: You can do a Google search and find out how to price your menu in a café or what the mark-up is on eyewear.
But you can’t find much when it comes to pricing, profitability or managing your cash flow as a floral designer and business owner.
I am on a mission to change that, to teach floral designers how to create better businesses. Part of that plan is to pass on as much as I can in terms of planning for profit and pricing with confidence.
TALKING ABOUT MONEY IS UNCOMFORTABLE
If you’re anything like me, the idea of openly talking about and discussing finances, money and cash flow feels scary (and honestly, slightly nauseating).
Most humans don’t enjoy talking about money. We have so many money stories and scarcity beliefs passed on to us, from our families, through our society and definitely in the floral design industry.
The problem is exacerbated the minute we decide to start a business.
The truth of the matter is: money has no more value than a Kleenex (check out Lynne Twists’ The Soul of Money for more amazing insight on this – click here).
Think about that for a second. The tissue in the bin and that $100 bill are equal.
It’s what we then make the $100 “mean” that gets us into hot water.
The reason all of this matters is because, the minute we decide to start a flower business, we bring all of our unconscious money stories to the table.
When we’re not aware of our money stories we get in our own way.
We hesitate to talk openly and honestly about budgets and prices with our customers.
We’re hesitant to invest in our business, even when we know it’s the right thing to do.
We spend money on things that don’t matter, in the hopes it will provide relief, a quick fix and reprieve. And, when we set big goals when we finally put pen to paper and set a sales target, we hesitate.
With all of this flying around inside our heads and our industry’s track record for being so secretive, it’s no surprise you can’t find useful resources and information to help you answer the questions “How do I manage flower business expenses?”
FLOWER BUSINESS EXPENSES – THE BASICS
Inside my Flower Boss Bootcamp, I break down all the ins and outs of money for florists and I follow a very simple framework for planning for expenses.
It’s not an exact formula but it’s a great guide: profit 20%, cost of goods sold 20%, operations 20%, taxes 20%, labour 20%.
Enlist the help of a financial guru, accountant or professional who can give you more state-specific guidance and keep you up to date on tax requirements, but when it comes to managing expenses in a flower shop, this five-part framework is my go-to suggestion. Over time, you will then start to understand your business even more and be able to come up with a more exact management system.
Every business has lots of details and nuances to sort through and your expenses will vary depending on your stage of growth.
I’m providing this framework as a place to begin, a place to start.
Need more guidance on pricing? Check out this awesome blog post we wrote a few months ago. Click here.
FLOWER BUSINESS EXPENSES – MY THREE TIPS
1 – Update your pricing today
You have the authority to update your pricing any time you like. Today is a great day to make that happen. If it’s been a long time since you’ve updated your pricing or you haven’t caught up with the recent fluctuations in wholesale costs, make it a priority. So many florists go wrong in managing their expenses before they even spend a penny. Get your prices sorted first.
2 – Track your expenses
When I finally admitted I wasn’t making money in my flower business, the best thing I did was to start to pay attention to where the money was going. I didn’t make any radical changes immediately, I simply started becoming aware of the $400 additional spend there, the extra staff hours here, etc. Just watching the expenses created a new level of awareness and understanding for managing my flower business expenses.
3 – Take action
For me, I had to reign in my spending in three areas (1) overbuying at the market (2) buying containers and vases I had no plans for and (3) staffing.
I set myself a challenge to spend 20% less at the market. I told myself, I could come back and buy it on Friday if I needed it but I realised how much leeway I was giving myself and how consistently “over budget” I was on my wholesale buys.
I stopped getting sucked into buying vases I didn’t need. I would only invest in a small set of commonly used containers and if there was something new and different I wanted to buy, I told myself I had to wait 7 days before I made the final decision.
Finally, we revamped our staff roster and got way clearer on a smarter staffing structure. We mapped out our systems and processes so our team had more clarity in terms of what needed to happen when and on those slow times, we did send casual staff home early.
In the end, the best approach was an incremental approach. We took it one week at a time and even in 30 days, our profitability started to increase.
Consistent, small actions add up over time and within a year, we had increased our profitability dramatically with little to no impact on our customer service, our design output or our brand.
SCARCITY THINKING = NOT MAKING MONEY
The starving artist persona runs rampant through our industry.
For years, I walked around unaware of my own “money stories”. I was adamant my area was too competitive, my customers won’t want to pay that much, and I kept telling myself I cannot charge that much.
I had no understanding that every one of these storylines wasn’t a scientifically proven fact. They were just stories I had made up, never questioning whether they were true.
I had no idea these stories were not “the truth”. In reality, all three of these storylines were just made up “money stories”.
I know I’m not alone in my unhelpful money beliefs. We all have unconscious money stories. Most of them are lessons learned from when we were young and now, as adults, we’re unaware of what those beliefs are creating in our business and our lives.
Learning to move away from scarcity-driven beliefs and leaning into an abundance mindset is one of the most important shifts to make if you want to start making more money in your flower business.
STRUGGLING TO MAKE ENOUGH MONEY?
If you’re feeling stuck and totally frustrated, we’re here to help.
My Flower Boss Bootcamp (click here) is our 90-day online program to help you build a business you love.
Sign up for the program and get my blueprint for creating a successful flower business. I give you the tools you need to re-write your money stories and teach you how to show up with confidence when it comes to pricing and sales.
We’re here to fast track your progress, to give you the tools you need to change the trajectory of your flower business. Click here to learn more about my Flower Boss Bootcamp and we’ll see you on the inside.