Survey results: Optimistic
The Society of American Florists’ (SAF) Economic Outlook Survey showed that 64 percent of respondents said they were either “very optimistic” or “optimistic” about sales expectations in 2018: All growers, 85% of wholesalers/suppliers/importers and 61% of retailers said they are “optimistic” or “very optimistic.” Even among those who expressed optimism for 2018, discipline and vigilance were constant themes — few industry members appear to be taking any sales or profit margins for granted.
Sales trends: Up for many
In that same SAF Economic Outlook Survey, 51% percent of all respondents said gross sales for 2017 increased over 2016. Among those who saw gross sales drop, around 72 percent said the decrease was fairly small, between one and ten percent. About three-quarters of those who saw sales rise said that the increase was between one and ten percent, with the remainder saying their increases were between 11 and 50 percent or more. Retailers also said their average transaction was slightly more than $66.
Big trend: Edible flowers, floral flavors
The floral industry may be getting a boost from, of all places, the food industry. Whole Foods reported that in 2018, flavors such as rose and lavender will be trending, as will edible flowers. This is a great opportunity to cross-merchandise flowers for any dining occasion.
Valentine’s Day projections: High
To add even more rosiness to this already-rosy outlook, Prince and Prince projected that nearly 44 million households would make one or more floral purchases to celebrate Valentine’s Day in 2018. They also projected that US consumer floral spending for Valentine’s Day would be $3.4 billion, and average projected spending just over $77. Their Valentine’s Day 2018 market value was about $106 million more than 2017.
2018 challenges: Drivers and labor
Of course, there are some challenges that the industry will continue to face in 2018. The continued shortage of truck drivers in the US, combined with new government regulations, are making transportation costs in the US up 20 to 30 percent over last year in some shipping regions. This is causing concern and fueling the exploration of driverless trucks. For growers, the biggest concern is labor – getting more applicants and filling skilled positions. This is creating investments in mechanization and automation, and alternative labor sources.
With an optimistic outlook for 2018, now is the time to pour the coals on your marketing actions to create a flourishing, profitable floral business!
Multiple growers, suppliers and researchers were surveyed by The Greenhouse Grower in regards to the 2018 State of the Industry. The survey's results are:
Grower top concerns:
- Labor: 61%
- Production costs: 54%
- Government regulations: 44%
- Climate change: 42%
- Insect & disease pressure: 40%
- Transportation costs/availability: 25%
- Competition: 63%
- Grower consolidation: 33%
- Economy: 30%
- Labor/availability of qualified workforce: 30%
- Weather: 28%
- Transportation: 27%
- Increase efficiency: 70%
- Improve produce quality: 59%
- Increase margins: 57%
- Greenhouse structures & coverings: 45%
- Computer services and technology: 25%
- Irrigation equipment: 23%
- Soil & amendment handling: 22%
- Planting equipment: 19%
For more information:
Rio Roses
www.rioroses.com