Florists
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 11,400 florists in the US specialize in selling cut flowers, flower arrangements, and potted plants. Major product categories include cut flowers (arranged and unarranged), indoor potted plants (blooming and non-blooming), and artificial/silk flowers, plants, and trees. Companies may also sell gifts, glassware (vases), souvenirs and novelty items, outdoor nursery stock, and seasonal decorations.
Variable Supply Affects Margins
The supply of fresh flowers can vary, and affect margins and a company’s ability to fulfill orders.
Seasonality Requires Working Capital
Demand for florists’ products is highly seasonal, and peaks during certain holidays.
Industry size & Structure
The average florist operates out of a single location, employs fewer than 10 workers, and generates about $421,000 annually.
- The florist industry consists of about 11,400 companies that employ about 62,400 workers and generate $4.8 billion annually.
- The industry is highly fragmented; the top 50 firms account for less than 10% of industry sales.
- Most companies are small, independent operators. Some companies own multiple stores, but generally operate within a limited geographical market.
- Large floral networks, such as FTD, have national and international operations.
Industry Forecast
Florists Industry Growth
Recent Developments
Jul 1, 2024 - Labor Costs Higher as Employment Falls
- Employment by florists fell in the first quarter of 2024, and the decline continued into April year over year, according to the Bureau of Labor Statistics (BLS). In April, employment fell 1% compared to a year ago. Employment levels in the industry have struggled to reach pre-pandemic levels, leaving some florists short on workers during peak periods and extra overtime costs. Meanwhile, labor costs continue to rise as companies compete for workers in a tight job market. Wages at florists rose almost 7% in April compared to a year ago, reaching an average of $18.73 an hour, per the BLS. Compared to pre-pandemic, wages have increased by almost a third. Florists may need to raise prices to account for higher labor costs or find other ways to cut costs to avoid a hit to profit margins.
- A recent federal ruling banning noncompete clauses may change how florists approach the hiring process and the buying and selling of existing businesses, according to an article in the Society of American Florists (SAF). Previously, florists could use noncompete clauses to prevent employees from working simultaneously at a competitor’s shop, starting up a new shop in the same market, or soliciting wedding and event business in competition with their employer. With the noncompete ban, florists may be cautious about hiring new employees who may be looking to start up as competitors. According to Brian Kusuda, chair of the SAF’s Retailers Council, “Many florists like us spend a lot of time and money training new employees, trying to help them understand our industry and what we do as a company to be successful. With these new rulings, the investment of time and money to train up new team members would come with much greater risk.” The ban could also increase the risks involved with buying and selling existing businesses if the sales agreement does not include a noncompete clause. The ban may cause problems with buyers concerned about a seller’s intentions since the seller could use the sale’s proceeds to open a new shop nearby. The rule goes into effect in September 2024. According to the article, the US Chamber of Commerce has filed a lawsuit over the rule, saying the ban would hurt both employers and employees.
- The US florists industry is projected to grow at a CAGR of 1.8% between 2024 and 2028, according to a forecast from Inforum and the Interindustry Economic Research Fund, Inc. The expected growth rate is slower than the overall economy's projected growth. Factors that continue to limit consumer spending are higher price levels and interest rates, though both are expected to improve in 2024. Post-pandemic, consumer spending has shown slower gains of 2.5% in 2022 and 2.2% in 2023, supported in part by savings amassed by households from federal pandemic relief programs. According to the forecast, "2024 may bring further deceleration, but improving consumer sentiment may support moderately strong gains in household spending, together with rising wage rates and lower inflation."
- Hyper-locally sourced cut flowers, virtual gardens, and table-top topiaries are emerging design trends forecast at the 2024 Philadelphia Flower Show per Greenhouse Grower. Hyper-locally sourced flowers are trending for floral events as the industry looks to reduce the carbon footprint of mass-grown imported flowers. Virtual gardens incorporate mixed media, projection, and floral photography together with physical flowers to create a more immersive floral experience. Other floral trends include bold neon colors, color-blocking, and large-scale statement floral sculptures and arrangements.
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