Tiger Lily standing out - Wholesale Florist _ Florist Supplier

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Tiger Lily standing out - Wholesale Florist _ Florist Supplier Powered By Docstoc
					                                                                  ORIGINALLY PUBLISHED IN       FLORISTS’ REVIEW, SEPTEMBER 2006

standing out
                                                                        in the crowd
                                                                                                                    BY SHELLEY URBAN
The second runner-up in our
“Retail Florist of the Year” contest
distinguishes itself by emphasizing exceptional products,
value and service to quality-minded consumers.

                                                                            It all started back in 1999, three years after Tiger Lily, then

         hink of brands such as Rolex, Lexus, even Starbucks.
         Most of us recognize these names and instantly think           known as Tiger Lily Florist, opened its doors. The owners of
         of the “luxury” images they evoke. They’re high-end,           the fledgling floral shop read all the books, followed all the rec-
premium selections in their categories whose focus is the qual-         ommendations and worked hard in the trenches to scratch out
ity of the merchandise, not the price point.                            a living. Yet the shop was struggling. Sales were growing, but
    In Charleston, S.C., an upscale floral business called Tiger        cash flow remained a constant challenge.
Lily can be added to the list of premium, luxury suppliers.                 In addition, Tiger Lily Florist had no individual identity.
“We’re not the cheapest,” says co-owner Manny Gonzales,                 There was nothing truly special about the shop, no real reason
“but we are trying to be the best.” And the company’s efforts           for customers to choose it over other florists. It was just one of
have not gone unnoticed.                                                many businesses that were, as Mr. Gonzales recalls, “fighting
    The residents of this historic coastal community have voted         over the Wal-Mart customer.” He says margins were tight, and
Tiger Lily “Best Florist in Charleston” for the past seven years. And   competing on price was not working.
the members of the “Retail Florist of the Year” contest commit-             Although the Gonzaleses considered shutting down or selling,
tee concur, selecting this 10-year-old shop as the second runner-       they made the fateful decision to try one more time—on their
up in our 2006 competition, sponsored annually in partnership           terms. “We threw all the books, guidelines and ‘industry stan-
with the Wholesale Florist & Florist Supplier Association               dards’ out the window,” says Mr. Gonzales. “Whether we suc-
(WF&FSA). See what makes Tiger Lily a consistent winner.                ceeded or failed, we would do it our way.”
                                                                            It was then that the Gonzaleses decided to be different from
BLAZING A NEW TRAIL                                                     all the rest, to be the best they possibly could be and to close
    Despite the shop’s seven-year tenure as among the best in           the book on doing things according to the status quo.
the region, Tiger Lily has not always been a favored floral out-
let. In fact, there was a time that Mr. Gonzales and his wife,          A STRATEGY FOR REINVENTION
Clara, with whom he co-owns the business, wondered                         In thinking about the qualities they wanted in their business,
whether Tiger Lily would survive.                                       the Gonzaleses considered some of their favorite nonfloral com-
                                                                                                      Tiger Lily
panies, such as Lexus,
Starbucks, a local tire store
                                                                                                        at a glance
                                                                                                           Owners: Manny and Clara Gonzales
and others. They planned
                                                                                                           Number of shops: 1
to emulate what these
                                                                                                           Location: Charleston, S.C.
companies do best.                                                                                         Year established: 1996
     One of the commonali-                                                                                 Clientele: upper income
ties among all of them,            Most of the cut flowers at Tiger Lily in Charleston, S.C., chill in the Average flower shop sale: $65 to $75
notes Mr. Gonzales, is an          cooler overnight, but during shop hours, they are displayed in the      Annual revenues: $1.5 million
                                   showroom in galvanized buckets to encourage customers to                Shop size: 7,500 square feet
emphasis on quality and            touch and smell the lush blooms as soon as they enter the store.
                                                                                                           Number of employees: 29
service rather than cost.          Unarranged flowers are sold for half the marked prices.
“Companies like Microsoft
and Lexus care about quality, and they’re known for fanatical                 marketing as well.
attention to detail,” he points out. “We also noticed that the most               Mr. Gonzales reports that once the new Tiger Lily
successful folks usually are not the cheapest.”                               emerged, the initial impact was a 15 percent loss in cus-
     So the Gonzaleses opted to emphasize quality cut flowers                 tomer base. “These were the 15 percent who wanted $100
and floral design paired with excellent service at a fair price, to           arrangements for $40, so losing them freed us to serve the
ensure that every sale is profitable.                                         ‘A-list’ customers who appreciate value and are less resistant
     “There’s so much mediocrity in business today. When con-                 on price,” he shares.
sumers find quality, most will gladly give their money to have
it,” explains Mr. Gonzales. “It doesn’t bother us if customers say            SECURE YOUR FUTURE WITH REAL ESTATE
we’re too expensive, but we would be concerned if they were                       Perhaps one of the most impressive turnarounds for this
to tell us our quality and service aren’t good enough.”                       young shop is its building ownership. Even without the
     Another step in the shop’s                                                                                $20,000 in tax incentives that
reinvention was to eliminate                                                                                   Tiger Lily qualifies for each
                                         “There’s so much mediocrity in
what didn’t align with the new                                                                                 year, Mr. Gonzales states,
                                         business today. When consumers
image the couple wanted to                                                                                     emphatically, that buying his
convey. “We dropped the
                                         find quality, most will gladly give their                             building costs the same as
‘Florist’ part of the name               money to have it.” — Manny Gonzales                                   renting. “Our monthly note is
because consumers often have                                                                                   the same as the rent at our
preconceived notions about what a florist is, and we’re trying to             former smaller location,” he assures, despite the added
be different from that,” Mr. Gonzales explains. “We also banned               $425,000 required to renovate the 1920s building, for which
carnations, daisies and plastic containers.”                                  they paid $550,000 in 2003. (For more information on the
     And they canceled the shop’s wire-service memberships.                   renovation, see FR’s “Extreme Makeovers,” August 2005,
“It’s hard to be different when you have to provide the same                  page 64 or visit
orders as everyone else,” Mr. Gonzales says. “Plus, I just could-             august2005/featurestory.html).
n’t figure out how to make money on incoming orders. Maybe                        As a result, Mr. Gonzales now urges renters to consider
some have, but I never did.”                                                  becoming buyers. “Think about what you’re paying in rent
     In addition, the new Tiger Lily eschewed all conventional                each month, and compare that to a monthly payment on a 30-
advertising, including Yellow Pages. “Consumers are so inun-                  year note,” he explains. “Real estate is still a tremendous
dated with ads. We didn’t want to spend money just being part                 investment, and once you have built up some equity, your
of all that clutter and noise,” Mr. Gonzales explains.                        building has the potential to ‘lay a golden egg.’”
     For a time, some of the advertising funds went toward a
marketing specialist hired to implement an innovative “guer-                  TODAY’S TIGER LILY
rilla”-type marketing program to gain no-cost press coverage                      As Mr. Gonzales describes it, efforts to differentiate the
in the forms of articles and on-air news features. “These                     business have “paid off handsomely.” Just six years later, by
types of messages are much more memorable than typical                        2005, Tiger Lily grossed $1.5 million in annual revenue, and
advertising,” explains Mr. Gonzales. The plan worked beau-                    the average customer purchase ranged from $65 to $75. The
tifully, and eventually, Tiger Lily cut back on this type of                  shop’s customer base in what is a fairly affluent community
now tends toward the upper end, with average household
income levels at approximately $125,000.
    Although actual dollars earned from walk-in sales account
for only about 10 percent of revenues, Mr. Gonzales says that
attracting walk-in business is an important element of the mar-
keting strategy. The physical location as well as what’s on dis-
play, and what is not, speak volumes about Tiger Lily.
                                                                    Clara and Manny Gonzales, owners of Tiger Lily, a favored flower
    Inside the chic 7,500-square-foot space, a former filling       shop among Charleston, S.C. residents.
and service station, only beautiful selections of cut flowers
and plants (which are upgraded and sold, on average, for
$75 each), are on display. A limited selection of stylish, qual-
ity glass vases, priced from $15 to $50, are the only add-on
sale items. There’s no plush, no home accessories, no gift
baskets and not even any permanents or drieds.                                                                                           The
    While a few cash-and-carry arrangements and temperature-
sensitive cut flowers are stocked in the showroom cooler,
most of the cut flowers are chilled in the storage cooler
overnight and then assembled, in decorative galvanized buck-
ets, into a “flower tower” in the showroom each morning.
    “We want customers to see the loose stems as soon as
they walk in the doors, and we want them to touch and
smell the flowers,” Mr. Gonzales explains. “We don’t want
customers to think of fresh flowers as ‘forbidden fruits’ con-       Tiger Lily’s efficient 3,000-square-foot design “studio” features
                                                                     overhead water sources at each of the 13 work stations as well as
cealed behind glass but luxuries — like a Starbucks coffee —         floor drains to prevent having to mop spills.
that they can have any time.” He says that each loose-flower
purchase averages around $20.                                          The designer plans floral décor for the hotel’s events, most
    A price for each cut selection is clearly indicated on         of which include rentals, which the shop arranges at a nice
bucket signage, but other signs nearby advertise the only          profit, for linens, chairs, props and lighting. And although
“special,” or discount, that Tiger Lily ever offers. All loose,    most of the design work is done at Tiger Lily, the hotel also
wrapped flowers are sold for half the indicated price every        provides a small design area for on-site work.
day. A full-time buyer, who Mr. Gonzales says “pays her                In exchange for access to its wealth of highly profitable
salary with the pricing she finds,” makes it possible, as does     events, Mr. Gonzales says that The Sanctuary receives 20 per-
a markup of 2 to 2.5 times on the halved prices. (Full-priced      cent of every event booked there. Other wedding and event
products are marked up by a factor of four or five.)               consultants who refer clients to Tiger Lily each earn a 5 per-
                                                                   cent commission on events that exceed $500.
EVENT-PLANNING PARTNERSHIP                                             “We have no problem working with these margins,” he
    Weddings and events are a huge part of Tiger Lily’s busi-      assures. “Volume is huge, and clients have virtually no price
ness. In 2005, the shop’s approximately 150 weddings totaled       resistance. However, clients’ expectations are extremely high,
around $500,000 (the average wedding ranges between $3,000         and we must deliver an outstanding product every time.”
and $3,500) as did its nearly 300 events. And with its creative        And when you’re striving to be the best, there will always
new event marketing strategy in place, Tiger Lily’s event busi-    be pressure, whether it’s a posh event with a seemingly unlim-
ness is likely to grow even stronger.                              ited budget or a small arrangement for local delivery in one of
    For more than a year now, the floral company has main-         the shop’s five delivery vehicles. Tiger Lily always wants to
tained a lucrative partnership with The Sanctuary at Kiawah        “Wow!” its customers, day in and day out, and that’s hard work
Island, an ultraluxury hotel and golf resort nearby. Tiger Lily    that requires constant vigilance. So far, though, since that fate-
provides all the hotel’s fresh floral arrangements and supplies    ful time in 1999, the shop and its savvy owners have proved
an on-site “décor specialist,” who shares office space with the    that they’re up to the challenge. I
hotel’s catering staff.                                            Contact Contributing Editor Shelley Urban at

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