• TABLE OF CONTENTS
HIDE
 Front Cover
 Abstract
 Table of Contents
 List of Tables
 Introduction
 Procedure
 Results
 Conclusion
 Reference














Group Title: Economics report - University of Florida. Agricultural Experiment Station ; no. 80
Title: Retailing floral and foliage crops through mass merchandising outlets in selected southern metropolitan areas
CITATION THUMBNAILS PAGE IMAGE ZOOMABLE
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00027734/00001
 Material Information
Title: Retailing floral and foliage crops through mass merchandising outlets in selected southern metropolitan areas
Series Title: Economics report
Physical Description: iii, 41 p. : ; 28 cm.
Language: English
Creator: Myers, L. H ( Lester H. ), 1939-
Taha, F. A
Publisher: Food and Resource Economics Dept., Agricultural Experiment Stations, Institute of Food and Agricultural Sciences, University of Florida
Place of Publication: Gainesville
Publication Date: 1976
 Subjects
Subject: Flowers -- Marketing -- Southern States   ( lcsh )
Plants, Potted -- Marketing -- Southern States   ( lcsh )
Foliage plants -- Marketing -- Southern States   ( lcsh )
Florists -- Southern States   ( lcsh )
Retail trade -- Southern States   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
bibliography   ( marcgt )
statistics   ( marcgt )
non-fiction   ( marcgt )
 Notes
Bibliography: Bibliography: p. 41.
Statement of Responsibility: L. H. Myers, F. A. Taha.
General Note: Cover title.
 Record Information
Bibliographic ID: UF00027734
Volume ID: VID00001
Source Institution: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: aleph - 000303998
oclc - 03344464
notis - ABT0568
lccn - 77620879

Table of Contents
    Front Cover
        Front Cover
    Abstract
        Abstract
    Table of Contents
        Page i
    List of Tables
        Page ii
        Page iii
    Introduction
        Page 1
        Page 2
    Procedure
        Page 3
        Page 4
        Page 5
    Results
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
        Page 23
        Page 24
        Page 25
        Page 26
        Page 27
        Page 28
        Page 29
        Page 30
        Page 31
        Page 32
        Page 33
        Page 34
        Page 35
        Page 36
        Page 37
        Page 38
    Conclusion
        Page 39
        Page 40
    Reference
        Page 41
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TABLE OF CONTENTS






,LIST.OF TABLES .. . . ........


INTRODUCTION . . . . . .


Background . .
Objectives . .


PROCEDURE . . . . . .


RESULTS .. .. . . . *


Reported Sales . .
Retail Florist Industry .
Local Florist Supply.. .
Mass Merchandising Florist
Temporal Sales Patterns .
Procurement Practices .
Pricing Margins . .
General Attitudes .. ...


* *



Crops


. .
. .
* .


CONCLUSIONS . . . . .. . .


REFERENCES . . . . . .


........g.........
..................
* *
.


* *













LIST OF TABLES


Table a

1 U.S. imports of selected types of cut flowers 1970-71
through 1973-74 . . . . . 2

2 Number of retail florists and sales levels for Birming-
ham, Memphis, and Tampa-St. Petersburg market areas,
1972 . . . .. . 4

3 Mail survey response by SMSA and type of firm . .. 5

4 Retail sales of floral and foliage crops by type of out-
let, three Southeastern Metropolitan Areas, 1971-72
through 1973-74 . . . . . 7

5 Retail sales of florist crops, by type of crop, by SMSA,
1971-72 and 1973-74 . . . .. 9

6 Retail florists' opinions on effect of mass marketing,
by type of crop, three SMSA's, 1973-74 . .. 11

7 Retail florists opinions on effects of mass marketing on
their own dollar sales, three Standard Metropolitan
Statistical Areas, 1973-74 .. . . 13

8 1Wholesale value of reported floral and foliage crop sales
by local suppliers, by SMSA, 1971-72 .. ... .. 14

9 Wholesale value of reported floral and foliage crop sales
by local suppliers, by SrISA, 1973-74 . ... 15

10 Floral and foliage supplier sales of florist crops, by
type of customer, and by SMSA, 1971-72 . 17

11 Floral and foliage supplier sales of florist crops, by
type of customer, and by SMSA, 1973-74 . . 18

12 Distribution of retail florist crop sales by mass mer-
chandisers by principal holidays, 1973-74 .... 20

13 Weekly sales of floral and foliage crops by days of the
week, mass merchandisers, 1973-74 . . 21







LIST OF TABLES--Continued


Table Page

14 Mass merchandisers' methods of procurement for floral
and foliage crops, by product type, and by SMSA,
1973-74. . . . . . .. 23

15 Location of mass merchandiser suppliers, by type of
crop, and.SMSA, 1973-74 . . . ... 24

16 Percentage of loss (based on total florist sales) by
type of crop in three Southeastern metropolitan markets,
1973-74 . . . . . . 26

17 Marketing services provided by mass marketing firms in
three Southern metropolitan areas, 1973-74 . 28

18 Percentage mark-up (based on purchase cost) for floral
and foliage crops by SMSA and type of outlet, 1973-74 ., 29

19 Mass marketing firms' rating of top advantages of selling
florist crops through mass outlets by SMSA, 1973-74 31

20 Mass marketing firms' rating of top disadvantages of
selling florist crops through mass outlets by SMSA,
1973-74 . . . ... . .. .2

21 Rating of importance for specific market activities by
responding firms for three SMSA's, 1973-74 .. .. 34

22 Mass merchant opinions on establishment of industry-wide
grade standards, by type of crop, by SMSA, 1973-74 .. 35

23 Mass merchants opinion on quality of floral and foliage
crops for the five year period, 1969 through 1974 . 37













RETAILING FLORAL AND FOLIAGE CROPS THROUGH MASS
MERCHANDISING OUTLETS IN SELECTED
SOUTHERN METROPOLITAN AREAS


L. H. Myers and F. A. Taha


INTRODUCTION


Background


Florida maintains an important position in the florist and ornamental
industry of the U.S. Annually it produces around 50 percent of the foliage
plants produced in the nation [7, p. 13]. During 1974, Florida produced
over 80 percent of the nation's gladiolus output and accounted for approxi-
mately 43 percent of the total area used for pompon chrysanthemum production
[7, p. 17]. Foliage plants, chrysanthemums,1 and gladiolus generated over
$75 million in sales at the wholesale level in Florida during 1974 [7, p. 5].
Thus the successful marketing of foliage and floral crops is of vital
importance to Florida producers.
The floral and foliage industry has been experiencing numerous changes
in recent years. Foliage sales have tripled since 1966. Imports of cut
flowers have expanded drastically (Table 1).
Despite the dramatic increases in imports, standard pompon chrysan-
themum domestic U.S. production has remained fairly stable. Wholesale
prices, however, increased 22 percent from 1970 to 1973 [1, p. 23]. This
suggests that the U.S. markets for floral and foliage plants have expanded
at a fairly rapid rate during the past few years.



Includes standard and pompon cut flowers and potted plants.

L. H. MYERS is associate professor of food and resource economics.
F. A. TAHA was former research associate in food and resource economics.







Table 1.--U.S. imports of selected types of cut flowers
1970-71 through 1973-74


Yeara Carnations S i n a rd Pompon
chrysanthemums h chrysanthemums


---------l1000 blooms-------- 1,000 bunches

1970-71 23,103 8,944 1,984

1971-72 42,052 12,521 2,702

1972-73 93,081 19,164 5,824

1973-74 165,444 26,490. 8,806


aFor fiscal years ending June 30.

Source: [1, p. 35].




While the increased demand is probably due to many factors, one
particular development is of interest to this study. This is the
movement of firms engaged in the retailing of large volumes of mer-
chandise (mass merchandisers) into the flower and foliage business.
Traditional retail florists depend almost entirely upon the "special
occasion" demand for floral and foliage products. This market tends
to be (a) seasonal, (b) somewhna limited by population growth, and
(c) price inelastic. On the other hand, the market represented by
mass merchandisers is generally thought to be (a) impulse oriented,
(b) seasonally uniform, and (c) less price inelastic than retail
florists' demand [5, p. 6B].
The basic differences in inarket characteristics and needs between
the traditional florists and mass merchandisers are of importance to
growers and wholesalers of floral and foliage crops. Production,
packaging, and transportation decisions may all be affected. In
addition, the method of sale may shift from wholesale markets and
brokers to direct contracts with producers.
This particular report is specific to the Birmingham. Alabama;
Memphis, Tennessee; and Tampa-St. Petersburg, Florida, Standard








Metropolitan Statistical Areas (SMSA's). It represents part of a
cooperative project with the Economic Research Service of the United
States Department of Agriculture. The total project includes 11 SMSA's
throughout the U.S. Results from other areas will be reported in
various forthcoming publications of agencies which participated in
the study.


Ob ectives


The general objective of this study was to identify the magnitude
and characteristics of the mass merchandising of floral and foliage
crops in selected Southeastern U.S. metropolitan areas. It represents
a contribution toward meeting the same objective for eleven selected
metropolitan areas of the U.S.
Specific informational objectives were; the determination of floral
and foliage sales levels by type of firm, the distribution of supplies
by local growers and wholesalers according to type of retail outlet,
and the pricing, distribution and service characteristics of mass
merchandising firms engaged in floral and foliage sales.


PROCEDURE


Three metropolitan areas, Birmingham, Alabama; Memphis, Tennessee;
and Tampa-St. Petersburg, Florida, were selected in the Southeast.
The Birmingham and Memphis metropolitan area are located in the East
South Central census region while the Tampa-St. Petersburg metropolitan
area is in the South Atlantic region. Comparable data on retail
florists for the selected SMSA's and respective census regions are
given in Table 2. These three cities were selected because of their
comparable size and because the number of firms to be interviewed was
manageable within the budget limitations. No sampling procedure was
implemented and the SMSA's selected are not intended to be representa-
tive of the census region within which they are located.
The survey process involved a two-stage procedure. The first
stage consisted of sending mail questionnaires to all retail florists,
florist wholesalers, growers, and mass merchandising firms in each








SMSA. 23 Mailing lists were developed from yellow page listings in the
phone directories of each SMSA. The objective was to mail questionnaires
to the population; therefore no particular sampling technique was
involved.4 Table 3 contains the mailing and response statistics for
each SMSA.


Table 2..--tumber of retail florists and sales levels for
BiLNiin1g'ham, 'frnmphlis, and Tampa-St. Petersburg
market areas, 1972


Fch ristics 3 irmingham Memphis Tampa-St. Pete
characteristics


No. of firms 135 96 169

Total sales
($1,000) 7,462 6,923 9,805

Sales per firm
($1,000) 55.3 72.1 48.0


Source: [6].




The second phase consisted of a personal interview with mass mer-
chandisers who had indicated, on the written questionnaire, yearly
floral and folii,',e crop sales of more than $500. University of Florida
personnel interviewed 14 firms in Tampa-St. Petersburg during January
1975 and 18 firms in Bmiminglam during late January 1975. The University
of Tennessee contacted 15 mass merchandising firms in June and September
1974 and obtained detailed information from five firms having annual



2Samples of the mail questionnaires are available from the
authors -upon rcec-'est'.

3Survey q1ic' cii.n.naires for retail florists, wholesalers and
growers were completed by personal interviews in Memphis.

4The results presented to this report are summaries of the
respondents only. No attempt is made to project these results to
national, regional, state, or even SMSA locals.








Table 3.--Mail survey response by SMSA and type of firm


Birmingham Memphis Tampa-St. Pete
Type of outlet
Sent Responsesa Sent Responsesa Sent Responsesa


Retail florists 107 45 95 93 144 43

Mass merchants:

Supermarkets 241 164 385 302 264 141
Department
stores 39 36 23 20 44 33
Variety
stores 18 16 15 11 26 20
Hardware 50 29 48 38 80 29
Pharmacy 118 62 103 78 109 60

Sub-total 466 307 574 499 523 283

Wholesalers 9 4 8 6 10 5

Growers 0 0 10 10 5 4

Total 582 356 687 558 679 335


alncludes those who responded but indicated no floral or foliage
sales or did not complete questionnaire.




florist sales greater than $1,000 during December 1974.5
For the purpose of this study, floral and foliage crops were
divided into the following categories: cut flowers, potted flowering










5As mentioned, the University of Tennessee assumed the responsi-
bility for conducting the survey in the Nemphis SMSA, Their unique
interests resulted in a research methodology which differed somewhat
with that used in the other metropolitan areas. Specifically, the
differences are as follows:








plants, foliage plants, Flowcingg bedding plants, and vegetable bedding
plants.6 Data reported on the mail survey related to the 1971/72 and
1973/74 fiscal years. The follow-up mass merchandising firm interview
obtained information only for the 1973/74 fiscal year.


RESULTS


Reported Sales


Table 4 contains the reported dollar sales of floral and foliage
crops by responding firms, by type of outlet for the three SMSA's. The
reader is cautioned regarding g comparisons between 1971/72 and 1973/74
since the 1973/74 information includes a few firms which were interviewed
but did not complete a rail quesUtionnaire for the 1971/72 information.
Thus the changes between 1971/72 and 1973/74 reported in Table 4 may
not adequately reflect the dynamics of the retail florist industry in
the areas surveyed.
During 1973/74, retail florists retained a major share of the
market for florist products in the three SMSA's. General merchandise
stores had substantial market shares in two cities, Birmingham (33 per-
cent) and Tampa-St. PetF-rsburg (32.9 percent). The situation appeared



Memphis Other Areas

Retail florists, wholesalers Personal Nail
and growers interview survey

Mass merchandisers Mail Personal
survey interview

Minimum annual floral and $1,000 $500
foliage sales for inclu-
sion in study

These differences may have affected the results and the reader is
cautioned to interpret differences between Memphis and other areas in
light of the methodology differences.

Bedding plants are defined as plants which are started from seed
and sold as young plaits for transplanting into vegetable or flower
gardens.








Table 4.--Retail sales of floral and foliage crops by type of outlet,
three Southeastern Metropolitan Areas, 1971-72 through 1973-74


Reporting Reporting Total Distribution
firms outlets florist sales of sales

--------Number-------- Dollars Percent

1971 72

Food stores

Small 3 6 4,000 .1

Large 3 89 115,000 1.8

General
merchandise 15 43 861,896 13.9

Retail florist 46 48 5,209,591 84.2

Total 67 186 6,190,487 100.0



1973 74

Food stores

Smallb 7 10 14,450 .2

Large 7 196 315,000 3.7

General
merchandise 24 97 1,639,624 19.5

Retail florist 53 56 6,436,952 76.6

Total 91 359 8,406,027 100.0


aThree Metropolitan areas are Birmingham,
burg, Florida; and Memphis, Tennessee.


Alabama; Tampa-St. Peters-


Small food stores are those with annual florist sales of less than
$5,000 per firm.

CLarge food stores are those with annual florist sales of more than
$5,000 per firm.








to deviate radically for Minp'hs where sampled firms indicated only
a 3 percent share for -',neral merchandise firms. Thus, general merchan-
dise outlets accounted for about 20 percent of the market in the three
areas combined. While it is evident from the study that grocery chains
are moving into the mari!tiig of florist products, their market share
as of 1973/74 :cnine- d quite small.
Tablc 5 cort:ains the breakdown of reported detail florist sales
by type of crop. In irrlinii.nam, cut flowers suffered a loss in market
share between 1971/72 and 17/3/74. Vegetable bedding plant market
share increased 94 percent during the two year period .This tends to
reflect increased consumer concern over high food prices and the desire
to grow their own vegetables. Hardware type stores are an important
outlet for bedding plAintis in the Birmingham area.
Contrasted with the Birmingham results, cut flowers maintained a
fairly constant market share in Memphis and Tampa-St. Petersburg over
the two yvar p.rtio.:l. 'hi.lec the market shares of all crops were fairly
stable in Memphis, in the Tampa-St. Petersburg area the vegetable
bedding plant market'share increased about 30 percent with an offsetting
loss by floiieri., b;ddiing plants.
Although reported foliage dollar sales increased 36 percent in Bir-
mingham, 28 ,t!:enti in [Himnphi.s, and 45 percent in Tampa-St. Petersburg
during the two peIriIod, market share gains were only 0.7, 1.0 and 0.5
percent, r:- .ic'l .ively.


Retail FlorisL rndu.3._cy


'ihe traditir:n.il consumer market for florist crops has been through
retail florists. Thel.-E businesses are characterized as being highly
speciali;_cd and service oriented. They cater to the "special occasion"
demand for floral ar,:angcriime:ts, The relationship between traditional
retail florists and mass mercbanrdisers'is important for two reasons.
First is, the real or pe.cei~' .d direct competition for the consumer's
flora) and foliage dollar. Second, a common sentiment by growers and
wholesalers seems to be a reltcrance to supply new mass merchandising
outlets because of a fear of losing their traditional retail florist
trade chroughi retaliatory action on the part of the retail florists,
Whether or not these fcLtorasi are justified, the fact remains that the








Table 5.--Retail sales of florist crops, by type of crop, by SMSA,
1971-72 and 1973-74


SMSA and product 1971-72 1973-74


Dollars


Percent


Dollars


Percent


Birmingham


Cut flowers
Potted plants
Foliage plants
Bedding plants:
Flowering
Vegetable

Total

Memphis

Cut flowers
Potted plants
Foliage plants
Bedding plants:
Flowering
Vegetable

Total

Tampa-St. Pete

Cut flowers
Potted plants
Foliage plants
Bedding plants:
Flowering
Vegetable

Total


654,492
252,844
209,447

133,528
44,542


50.6
19.5
16.2

10.3
3.4


769,160
386,280
330,020

341,831
129,720


39.3
19.7
16.9

17.5
6.6


1,294,853a 100.0 1,957,011a 100.0



1,871,530 59.3 2,209,833 58.5
596,459 18.9 741,915 19.6
451,229 14.3 577,753 15.3

131,073 4.2 138,731 3.7
104,869 3.3 110,334 2.9

3,155,160a 100.0 3,778,566 100.0



637,950 45.3 921,850 46.4
341,700 24.3 458,100 23.0
264,650 18.8 384,050 19.3

115,000 8.2 136,800 6.9
49,200 3.4 86,500 4.4


100.0


100.0


aTotals are different from those in Table 4 since a few firms
did not provide breakdown by type.







impact of mass" ner.chliidsinig on traditional retail florists must be
assessed. An attempt to answer some questions regarding this impact
was made via a mail questionnaire (BirminghL-mi and Tainpa) and personal
interview (Memphis) of retail florists in each SMSA.7 Table 6 contains
the retail florists' opinions of the effects of mass merchandising on
their sales of variiou t.pe': of products and selected other factors.
Retail florists in the three metropolitan areas felt that the'
largest mass merchandising ;imr,--:ct in terms of decreasing their sales
was with respect to potted flowering plants. For the three SMSA's
combined, 29 percent of the firms responding to the question felt that
mass merchandising had decreased their sales of potted plants. A total
of 16 percent felt that foliage sales had decreased, 10.7 percent felt
that cut flower sales had decreased, and 13.3 percent felt that bedding
plant sales had decreased.
The nature of the competitive impact is clouded by the fact that
many retail florists felt mass merchandising had actually increased
sales of cut flowers (43 percent), potted plants (44 percent) and foliage
(53 percent).
Forty-six percent believed that mass merchandising had no effect
on their cut flower sales, while 27 percent and 31 percent felt no
effect on potted plant and foliage plant sales, respectively.
The effects of tl,:', mass merchandising- of florist crops on other
aspects of the retail florists' business are equally indecisive. None
of the retail florists responding in the three SMSA's felt that potted
chrvsanthemium prices had decreased because of entry by mass merchandisers
into the florist trade. On the other hand, 83 percent believed that
mass mar..etimii led to increased potted chrysanthemum prices. The
reasons for the latter connection can only be based on conjecture. More
competition for available suppllies may have resulted in higher wholesale
prices for potted chrysanthemums. Also, retail florists may have simply
attributed price increases for plants and flowers purchased due to



7Unfortunately a procedural error in the mail out process resulted
in many retail fluoi.cts receiving questionnaires designed for mass mer-
chandisers in DicninghETa and Tampa-St. Petersburg. The resulting limited
response rate for these two areas prohibits an analysis by SMSA.





Table 6.--Retail "forists' opinions on effect of mass marketing, by type of crop,
1973-74


three SMSA's,


Nature of reported impact on sales and marketing practices:
Item
Increase No effect Decrease All respondents


Number Percen Number Percent Number Percentb Number Percent

Sales of:

Cut flowers 24 42.9 26 46.4 6 10.7 56 100

Potted plants 24 43.6 15 27.3 16 29.1 55 100

Foliage plants 29 52.7 17 30.9 9 16.4 55 100

Bedding plants 2 13.3 11, 73.4 2 13.3 15 100

Average price of
potted chrysanthemums 45 83.3 9 16.7 -- 54 100

Cash and carry sales 19 36.5 21 40.4 12 23.1 52 100

Volume of holiday sales 25 46.3 17 31.5 12 22.2 54 100

Advertising
expenditures 15 27.8 36 66.7 3 5.5 54 100

a
SAMA's are Birmingham, Alabama; Tampa-St. Petersburg, Florida; and Memphis, Tennessee.

Percent of those responding to question.







general inflationary pressures erroneously to the entry by mass merchan-
disers into the market.
Approximately one third of the respondents indicated that they had
increased their adverti-inrg expenditures as a result of the increased
competition.
Certainly no ri-~.-il florists' consensus that mass merchandising
has been detrimental to ti!Lir business exists in the three metropolitan
areas covered by Hhii study.
Table 7 contains rhe results of two other questions designed to
ascertain the actual and perceived impact of mass merchandising on
retail florists'business. One question asked retail florists what
effect the sales of florist crops by mass market outlets in the SMSA
had on their dollar sai- during the past three years. Another question
then asked retail l.rx:.sts what effect, they think, sales by mass
merchandisers will have on their volume sales during the next three
years. The results may illustrate the difference between "real effect"
and "antic ip-ited effect". Of those responding to both questions for
all three areas, nearly 54 percent of the retail florists felt no effect
from mass me:u-h..n.di:ing during the past three years while 39 percent felt
that the -corup..ti.ion had-J decreased their sales. Contrasted with those
figures, 49 percent felt that the competition would result in decreased'
sales during the next three years. Interestingly, 17 percent felt that
the net effect of mass Inerchondising would result in increased sales
levels for their ri t:l florist operation during the next three years.
That is, 17 percent of the respondents felt the impact of increased mass
merchandising *,oui.l be complementary to their business during the next
three years as cf.-po.-ed to being competitive.


Local Floris't Supily


An effort was made to identify the impact of local suppliers (whole-
salers and grower/wholesalers) in meeting the demand for florist products
within each .ilISA, A :loc.il supplier is defined as a wholesaler or grower/
wholesaler with opCraing offices located within the SNSA.
The breakdown of local supplier sales by type of crop are provided
in Table 8 and 9 for 1971-72 and 1973-74, respectively. The response





Table 7.--Retail florists opinions on effects of mass iarketin; on their own dollar
sales, three Sanda3rd 'etropoliarn Statistical Areas, 1973-74


Time Nature of reported impact on sales
period
SIncrease No effect Decrease All respondents


Number Percenta Number Percenta Number Percenta Number Percent

Past 3 years 4 7.1 30 53.6 22 39.3 56 100

Next 3 years 9 17.0 18 34.0 26 49.0 53 100


percent of those responding to question.


1H








Table 8.--Wbholesale value of reported floral and foliage crop sales by
local suppliers, by SMSA, 1971-72


Bedding Total
SMSA and Cut Potted Foliage plants all
type of supplier flowers plants plants crops
,Flow. Veg.


------------------ ------------$1000


B i rm inham

Grower and grower/
wholesaler


Wholesaler

Total


742.7

742.7


124.4

124.4


56.0

56.0


-- 923.1

-- -- 923.1


Memphis

Grower and grower/
wholesaler


Wholesaler

Total


S 393.8

1,380.9 395.2

1,380.9 789.0


Tampa-St. Pele

Grower and grower/
wholesaler

Wholesaler

Total


331.5

1,130.6

1,462.1


476.3

52.4

528.7


34.3 -- 75.3 917.4

-- -- -- 1,183.0

34.3 -- 75.3 2,100.4


99.6

149.6

249.2


8.7

7.2

15.9


2.9

2.9

5.8


505.0

1,935.8

2,440.8








Table 9.--WholesAle value of reported floral and foliage crop sales by
local suppliers, by SMSA, 1973-74


Bedding Total
SMSA and Cut Potted Foliage plants all
type of supplier flowers plants plants crops
Flow. Veg.

--.-----------------------$1,000-----------


Birmingham

Grower and grower/
wholesaler


Wholesaler

Total


839.3

839.3


133.6

133.6


80.7

80.7


- 1,053.6

- 1,053.6


Me mphi s

Grower and grower/
wholesaler

Wholesaler

Total


Tampa-St. Pete

Grower and grower/
wholesaler

Wholesaler

Total


-- 472.6

1,971.2 442.6

1,971.2 915.2


369.0

1,159.0

1,528.0


669.2

46.3

715.5


157.6

177.6

335.2


14.8

7.3

22.1


13.0

5.4

18.4


64.0 36.9 1,139.1

-- -- 1,205.3

64.0 -- 36.9 2,344.4


658.0

2,604.1

3,262.1


- --




16


by growers and wholesalers in each SMSA is as follows:

Grower Wholesaler
No. No.

Birmingham 0 3

Memphis 3 7

Tampa-St. Petersburg 4 4


Comparison of the reported wholesale sales by type of crop with the
reported retail sales by type of crop (Table 5) suggests that: (a) cut
flowers and potted flowering plants are supplied to retailers primarily
through local wholesalers and grower/wholesalers and (b) foliage and
bedding plants appear to be provided primarily by outside suppliers for
the three SMSA's. Foliage plants are primarily produced in Florida in
areas outside the Tampa-St. Petersburg SMSA. Thus, the results would
support the hypothesis that most foliage sales are via direct negotia-
tion with grower/wholesalers.
One might expect bedding plants to be produced primarily within the
local SMSA area. The survey results suggest that they are either trans-
ported into the consuming area or are produced within the area by
growers not included in the study's definition of a floral and foliage
producer and sold-directly to retail outlets.
Floral and foliage supplier sales according to type of customer
are delineated in Table 10 and 11. During 1973/74, the percentage
breakdown of sales for all three areas combined was as follows:

Retail florists owned by supplier .2%

Retail florists other 89.9%

Wholesalers 5.1%

Mass merchandisers 4.3%

Others .5%

8
Respondents indicated that an average of 23.4 percent of total retail
florist sales in the three areas were accounted for by mass merchandisers



8Derived from the figures presented in Table 4.




17


Table O1.--Floral and foliage supplier sales of florist crops, by type of
customer, and by SMSA, 1971-72


Retail
florists
SMSA and florists Whole- Mass mer- Others Total
type of supplier Own Others sales chandisers
Own Others


$1,000---------------------


Birmingham

Grower and grower/
wholesaler

Wholesaler

Total


Memphis

Grower and grower/
wholesaler


Wholesaler

Total


915.6

915.6


499.2


1.4


2.0 1,670.7 260.9

5.8 2,169.9 262.3


7.5

7.5


1.5

1.4

2.9


923.1

923.1


505.0


1,935.9

2,440.9


Tampa-St. Pete

Grower and grower/
wholesaler


Wholesaler


594.8

1,134.3


88.4


9.0


158.8


39.7


917.3


S 1,183.0


1,729.1 97.4


aPrimarily to other growers.


Total


198.5


75.3


2,100.3


----------------------




18


Table 11.--Floral and foliage supplier sales of florist crops, by type of
customer, and by SMSA, 1973-74


Retail
florists
SMSA and Whole- Mass mer- O
type of supplier Own Others sales chandisers
Own Others


--------------------- $1,000----------------------


Birmingham

Grower and grower/
wholesaler


Wholesaler

Total


-- 1,045.6

-- 1,045.6


1,053.7

1,053.7


Memphis


Grower and grower/
wholesaler


Wholesaler

Total


647.0


1.8


-- 2,324.1 274.5

11.1 2,971.1 276.3


1.8

1.8

3.6


658.0


-- 2,604.1

-- 2,362.1


Tampa-St. Pete


Grower and grower/
wholesaler


Wholesaler


Total


-- 804.0 60.2


-- 1,164.6


3.5


- 1,968.6 63.7


238.1

37.2

275.3


1,139.2


-- 1,205.3


36.9


2,344.5


aPrimarily to other growers.








during 1973/74. Yet the above figures suggest that only 4.3 percent of
the sales by wholesalers and grower/wholesalers go to mass merchandise
outlets. For whatever reason, local wholesalers do not appear to be
supplying the product needs of the local mass market outlets.


Mass Merchandising Florist Crops


Considerable effort was expended in the study to collect detailed,
information on mass merchandising practices by those retailers who
handled florist crops along with other high volume goods. In Birmingham
and Tampa-St. Petersburg the data were collected via personal interviews
with the merchant. In Memphis the same questionnaire was mailed to
mass merchandisiers who had been identified as being involved in florist
crop sales. The results presented in this section are based upon
completed questionnaires as follows:

Total florist
SMSA Number of firms sales, 1973/74


Birmingham 15 $878,000

Memphis9 5 $ 90,000

Tampa-St. Petersburg 11 $245,150


Temporal Sales Patterns


Table 12 reports the percentage sales distribution by responding
mass merchandisers according to major holidays. Considerable variation
exists in the holiday sales pattern among different florist crops.
The sales pattern of cut flowers for all three cities combined is
fairly evenly divided between Christmas, Easter, Mother's Day, and
non-holiday periods. Potted plants sales are heavily holiday oriented
with Easter and Christmas accounting for over 70 percent of the yearly
sales. Finally, as one would expect, holidays account for less than



9The different methodology for Memphis probably accounts for the
reduced response rate compared to the other two SMSA's.





Table 12.--Distribution of retail florist crop sales by mass merchandisers by principal holidays,
1973-74


Holiday
S Il l A a- 'd
product a Inc ine' s Mother's Kemorial Non- Total
hristms Easter Day Day holiday sales


--------------- ----- --ercent------- -ernt ---------------------------

Birminghama

Cut flowers 5.8 1.2 7.8 7.0 78.2 100
Potted plants 23.1 8.0 34.1 27.0 3.2 4.6 100
Foliage 3.5 0.4 1.0 1.6 .3 93.2 100

Memphisb

Potted plants 42.5 2.0 35.0 2.8 1.7 16.0 100
Foliage 0.3 1.8 2.3 1.8 1.7 92.1 100

Tampa-St. Petea

Cut flowers 20.7 4.6 30.7 29.3 4.7 -- 100
Potted plants 28.3 2.2 51.0 8.8 2.2 7.5 100
Foliage 14.2 1.7 8.2 4.2 -- 71.7 100

Summary

Cut flowers 23.6 3.6 24.2 23.0 3.4 22.2 100
Potted plants 27.5 4.4 43.4 15.1 2.5 7.1 100
Foliage 8.5 1.2 4.7 2.9 .3 82.4 100


aEach firm's reported percentage weighted by proportion of its total florist sales to
sales of all reporting mass merchandising firms selling that type of crop.

bNone of the firms reporting holiday sale breakdown noted any cut flower sales.


total


CAverage of three cities weighted by number of firms.









20 percent of the foliage yearly sales.
The three city summary statistics hide a fairly strong intercity
variability. While cut flower sales by mass merchandisers in Birmingham
are not large ($7,900), they occur mostly during non-holiday periods.
Conversely, the reported cut flower marketing in Tampa-St. Petersburg
were all allocated to holiday periods. Easter is the strongest sales
period for potted flowering plants in Tampa-St. Petersburg and Birming-
ham while Christmas is the major sales period in Memphis. Foliage sales
are consistently non-holiday oriented in all three SMSA's.
Throughout the week, florist sales in mass merchandise outlets
appear to be concentrated on Fridays and Saturdays (Table 13). For the
three cities combined, 64 percent of the reported sales occurred on
Friday and Saturday. This figure ranged from 70 percent in Birmingham
and represented 9 percent of the total weekly sales in Memphis and
Tampa-St. Petersburg.


Table 13.--Weekly sales of floral and foliage crops by days of
the week, mass merchandisers, 1973-74


Mon. -
Friday Saturday Sunday Thurs.


-----------------Percent-----------------

Birmingham 32 38 -- 30

Memphis 23 24 9 44

Tampa-St. Pete 36 25 9 30

Three cities 33 31 5 31
average








Procurement Practices


An important objective of the study was to determine, as much as
possible, the source of floral and foliage supplies for mass merchan-
disers. The following two tables summarize the findings.
Table 14 contains a summary of the procurement method used by
responding mass merchandising firms. For the three cities combined,
outright purchase is the predominant method of procurement. Some con-
signment activity is present with 46 percent of the reported cut flower
volume being procured on a consignment basis.
Tampa-St. Petersburg firms seemed to have different procurement
practices than firms in the other two cities. Supplies secured on a
consignment basis range from 26.4 percent for potted flowering plants
to 74.3 percent for cut flowers. One reason for this may be the
proximity of the Tampa-St. Petersburg SMSA to the large commercial
production areas of Florida. Growers may be more willing to agree to
consignment sales,thereby assuming many of the marketing risks, where
a substantial transportation cost is not involved. The highest propor-
tion of any type crop secured through consignment reported for Birming-
ham and Memphis was 3.8 percent for cut flowers in Birmingham.
No leased operations were reported as a means of securing supplies
for the three regions. Within the three cities included in this report
little or no evidence exists to suggest vertical integration back to
the production of florist crops by mass merchandisers.
Since Florida is a primary producer of many varieties and types of
floral and foliage crops, it is of interest to know the origins of the
supplies acquired by mass merchandisers. Table 15 contains the supply
source locations by type of crop and by SMSA.
Florida is a large producer of pompon and standard chrysanthemums
and one would expect it to be the major supplier of these flowers to
Southeastern cities. While the responding firms exhibited only minimal
efforts in cut flower marketing, it is interesting that 90 percent of
the chrysanthemums reported sold by mass merchandisers in Birmingham
were secured from suppliers in California. Even in Tampa-St. Petersburg,
20 percent reportedly come from California. California shipments to
Florida can perhaps be explained by the inability of Florida growers to
produce mums during the summer months. Birmingham, on the other hand,









Table 14.--Mass merchandisers' methods of procurement for floral and
foliage crops, by product type, and by SMSA, 1973-74


Method of procurement
SMSA and
type of product Outright Consignment Total
purchase


Percent $1,000 Percent $1,000 Percent $1,000

Birminghama

Cut flowers 96.2 7.58 3.8 .30 100 7.88
Potted plants 96.3 152.88 3.7 5.87 100 158.75
Foliage plants 98.6 206.56 1.4 2.93 100 209.49
Bedding plants 98.8 393.10 1.2 4.78 100 397.88

Memphisb

Cut flowers 100.0 4.77 -- -- 100 4.77
Potted plants 99.7 34.74 0.3 .11 100 34.85
Foliage plants 99.9 41.27 0.1 .02 100 41.29
Bedding plants 97.5 64.56 2.5 1.65 100 66.21

Tampa-St. Petea

Cut flowers 25.7 5.11 74.3 14.79 100 19.90
Potted plants 73.6 169.65 26.4 60.85 100 230.50
Foliage plants 62.6 154.87 37.4 92.53 100 247.40
Bedding plants 57.2 127.73 42.8 95.57 100 223.30

Summar, c

Cut flowers 53.6 17.46 46.4 15.09 100 32.55
Potted plants 84.2 357.27 15.8 66.83 100 424.10
Foliage plants 80.8 402.70 19.2 95.48 100 498.18
Bedding plants 85.2 585.39 14.8 102.00 100 687.39


aEach firm's percent weighted by proportion of its total florist
sales to total sales of all mass merchandising firms selling that type
of crop.

bEach firm's percent weighted by proportion of its sales of product
type to cotal sales of that product type by all mass merchandising firms
selling that type of crop.

CWeighced average of three cities.









Table 15.--Location of mass merchandiser suppliers, by type of crop,
and SMSA, 1973-74


Location of plant supply
SISA and Over 50 miles
crop type Within Oe50il Total
50 miles CA FL Other

--------------------Percent --------- --

Birmingham
Cut flowers
Carnations -- 100 -- 100
Std. mums -- 90 10 100
Pompon mums -- 90 10 -- 100
Roses -- -- -
Glads -- --
Potted flowers
Std. mums 66 -- 8 26 100
Poinsettas 29 -- 33 38 100
Azaleas 1 16 7 76 100
Foliage plants 34 -- 50 16 100
Bedding plants 10 -- 90 100
Memphis
Cut flowers
Carnations -
SLd, mums -
Pompon mums "
Roses --- --
Glads --
Potted flowers
Std. mums 77 -- 13 10 100
Poinsettas 77 -- 10 13 100
Azaleas 67 -- -- 33 100
Foliage plants 4 32 16 48 100
Bedding plants 4 -- 96 100
Tampa-St. Pete
Cut flowers
Carnations -- -- --
Std. mums -- -. 2- 1-
Pompon mums 60 20 20 -- 00
Roses -- -- -
Glads 96 0.5 3 0.5 100
Potted flowers
Std. mums 46 54 -- 100
Poinsettas 45 -- 55 -- 100
Azaleas 18 -- 82 -- 100
Foliage plants 96 -- 4 -- 100
Bedding plants 88 -- 12 100








would appear to be a market where Florida producers are not effectively
competing for the mass market dollar. Given the location advantage that
Florida has for supplying Southeastern cities, growers might well
consider a more aggressive marketing program aimed toward mass merchan-
disers in these cities.
Flowering potted plants are secured primarily from either local
or Florida growers for all three cities. The exception is azaleas for
Bicingha~m, where a large supply is obtained from Mississippi growers.
Foliage plants also come largely from local and Florida producers.
Memphis deviates somewhat from the pattern by securing 32 percent of the
foliage needs from California sources.
Some cautions should be exercised when interpreting the results in
Table 15. In the process of interviewing buyers for mass merchandising
firms it appeared that a substantial number were not fully aware of the
ultimate supply source. For example, one buyer in Birmingham indicated
Loug Island, New York as the source of the firm's foliage supplies,
When questioned further it was determined that the plant material came
from Florida but was transported by a Long Island trucking company. The
lack of ability to identify the source of supply by some respondents may
hive led to some inaccuracies in Table 15.


Pricin- iMairgins


Floral and foliage crops are new to many mass merchandising firms
and their characteristics may tend to differ considerably from the types
of godJ usually handled by these firms. Special in-store care, display
pribllenms: spoilage, and lack of knowledge about handling and care of
floral and foliage crops by store personnel are factors affecting the
nagrnitude of price margins.
Loss from spoilage due to improper care or over-ordering can con-
tribute greatly to Eoral and foliage retailing costs. Thus, one aid
to\wairc understand d the price margins charged by retailers is an under-
standin:: of the nature of the stock losses absorbed by the retailer.
Table 1P- is a report of the numbers of firms experiencing various levels
of losses for the four types of crops for the three SMSA's combined.
I.:jl.t: firms reported losses pf 6 percent or less for all types of crops.
Losses ;'eater than 9 percent were reported by 40 percent of the firms





26


Table 16.--Percentage of loss (based on total florist sales) by type a
of crop in three Southeastern metropolitan markets, 1973-74


Type of crop 0-2% 3-4% 5-6% 7-8% 9-10% Above 10%

b
---------------------Percent-------------------

Cut flowers 40 -- 20 -- 20 20

Potted 33 9 29 -- 17 12

Foliage 36 5 36 -- 14 9

Bedding 30 13 31 -- 13 13


aBirmingham, Tampa-St. Petersburg and Memphis SMAS's combined.

Percent of firms reporting.








selling cut flowers, 29 percent of the firms selling potted flowering
plants, 23 percent of the firms selling foliage, and 26 percent of the
firms selling bedding plants.
Retailer mark-ups on floral and foliage products also depend on
volume turnover and services rendered. Generally speaking, traditional
retail florists sell a "package" which, in addition to the basic floral
and foliage material, includes many services and some other materials.
Mass merchandisers, on the other hand, generally strive for high volume,
quick turnover sales with a minimum service input. Some indication
of the frequency with which various selected services are offered by
mass marketers of florist crops is given in Table 17.
Only 6 percent of the mass merchandiser respondents in the three
markets offered florist arrangements for their customers. Less than
20 percent offered packaging and delivery services. A majority (58
percent) offered some type of special display care. Special display
care was defined rather broadly to include one or more of the following
items: (a) special training for clerk in the care of flowers and plants,
(b) special training for clerk in selling flowers and plants, and/or
(c) brand labels and/or care instructions labels. Also, special train-
ing was interpreted quite liberally to accept such things as "experience".
Thus, the results are consistent with the minimal service package offered
by mass merchandisers for most items.
Firms were asked to give their average mark-up for the various
florist crops. These mark-up percentages were to be based on the pur-
chase cost. The results, summarized by type of outlet are reported in
Table 18.
The wveigihted average mark-ups for all crops ranged from 39 percent
in Birmingham to 46.2 percent in Tampa-St. Petersburg. Relatively
little variation in mark-ups was exhibited between crop types. Sub-
stantial inter-city and inter-store type variation in mark-ups was
evident. General merchandise stores tend to have the highest mark-ups
in Nemphis and TampaSt. Petersburg while large grocery stores had the
largest in Birmirnghimi, I while one might expect, a priori, that small
groceries would have the largest percentage mark-ups, they actually had
the lowest average margins in Birmingham and Memphis.
The mark-ups cited in Table 18 are consistent with those obtained
in the overall mass marketing study for other cities in the U.S. [2, 4].








Table 17.--Marketing services provided by mass marketing firms in three
Southern metropolitan areas, 1973-74



Service Birmingham, Memphis Tampa Three market


Packaging

Arrangements

Credit

Delivery

Display care


Peccenta

27



53

27

60


Percent

20

20

20

20

80


St. Petersburg


Percent



9

18

9

45


total


Percent

16

6

35

19

58


Total firms
reporting 48 16 36 100


firms reporting for

all firms reporting


SMSA only.

for all three SMAS's.


aPercent

bPercent


r~


_ ~~ ..,......~ ...~ .. .._. .- .. .I-~...i..~ I~~--.L.-~c. ...~. ---


-------------- ------- -







Table 18.--Percentage mark-up (based on purchase cost) for floral and foliage
crops by SMSA and type of outlet, 1973-74


SMSA and a
SSA and Large grocery Small grocery Gen. Msde All outlets
product

--------------Weighted average percent mark-up----------b

Birmingham

Cut flowers 45 -- 40 40

Potted 44 32 39 39

Foliage 44 32 39 39

Bedding 44 32 39 39

All crops 44 32 39 39


Memphisc

Potted 40 37.6 49.5 46.2

Foliage 40 37.6 49.5 46.2

Bedding 40 37.6 49.5 46.2

All crops 40 37.6 49.5 46.2


Tampa-St. Pete

Cut flowers 30 50 50 47

Potted 31 48 50 47

Foliage 25 -- 50 47

Bedding 25 -- 48 44

All crops 31 48 49 46


aWeighted average based on relative sales level by type of outlet.

bWeighted according relative dollar sales by each firm.







However, in a separate study [3] Ceorg.rM Kress ottamc-ed data to suggest
that most firms obtained a 35 to 50 percent mark--lp based on selling
prices. This implies mark-ups of 54 to J100 percent when based on
purchase costs. As mentioned above, the mark-ups given in Table 18
are based on purchase costs. No apparenL reason could be found for the
substantial difference between the two studies.


General Attitudes


An attempt was made in the survey to ascertain the general opinions
of mass merchandising firms toward the marketing of floral and foliage products.
Questions were asked relating to retailers opinions re-~,rding advantages
and disadvantages of selling floral and fo'ilage crops, their opinions on
quality and grade standards, and their idea of the importance of care and
price labeling. The following tables su.immari '. the results.
Table 19 includes those items considered to be the main advantages
associated with selling florist crops. For the three market areas com-
bined, 74 percent of the firms listed the increase in store traffic as a
major advantage. This response is impotltaii because it suggests that
floral and foliage products are not solely an ir.i.ipuls- item in the general
merchandise or grocery store but: rha the items themselves generate
store traffic. That is, the responrde-nt>-, felt that people came to their
store specifically because they handled floral and foliage items.
Two other specific advantages listed were "attractive return on
:investment" and "brnadens product bcae". Several retailers mentioned
during the course of the interview that r-hev hlandied floral and foliage
products because of requests that they do so by their customers. Approxi-
mately one half of the respondents listed each of these items as top
advantages.
A vast majority (77 percent.) of the respolndcrnLs considered the
special care involved in handling florist ccips to be a disadvantage
(Table 20). Another disadvantage mentioned by more than half of them
was the lack of adequately trained manrigemeic..
Mass merchandisers place a high priority on minimizing the labor
input involved in merchandising a particular go'l.,. Thus, market expan-
sion for floral and foliage crops through mass nmal.'et outlets could be
enhanced greatly via developments in packaging and platl material








Table 19.--Mass marketing firms' rating of top advantages of selling
florist crops through mass outlets by SMSA, 1973-74


Advantage Birmingham Memphis Tampa-St. Pete Three SMSA's


%a %a %a %b

Increases
store traffic 87 40 73 74

Attractive
return on
investment 53 60 54 55

Broadens
product base 33 40 64 45

Other 20 20 9 16

Total firms 48b 16b 36b 100
reporting

percent of all firms responding for SMSA only.


bPercent of
areas combined.


all firms responding for three Southern metropolitan








Table 20.--Mass marketing firms' rating of top disadvantages of selling
florist crops through mass outlets by SMSA, 1973-74


Disadvantage


Birminhgham


Memphis Tampa-St. Pete


Three SMSA's


'a v-a a
/% %A


Requires special
care

Lack of trained
management

Limited market

Limited supply

Limited return
on investment

Other


40


Total firms 8b 16b 36b 100
responding


aPercent of all firms responding for

percent of firms responding for
Percent of all firms responding for
areas combined.


SNSA only.

three Southern metropolitan


I____ __ __
___ II~_








designed to reduce the in-store care needed.
The producing and wholesaling sectors of the florist industry could
also enhance the mass market demand for their products by organizing
retail management training programs. Trade associations might take an
active role in developing and presenting short courses in the care and
management of the various florist crops at the retail level. The survey
results suggest a critical need in this area.
The remaining tables relate mass merchandisers' opinions of indus-
try practices and standards that are directly influenced by the producing
sector.
Price and care labeling of floral and foliage items are considered
important by nearly all retailers (Table 21). Of 31 firms responding
for the three market areas combined, 87 percent felt that price labeling
was at least of some importance as a marketing activity. The comparable
figure for care labeling was over 90 percent. Frequently people being
interviewed emphasized the importance of care labeling. This fact is
made all the more important when one notes the evident lack of adequate
management and clerk training in the marketing and care of floral and
foliage products.
Mass merchants were asked whether or not they agreed with the esta-
blishment of uniform, industry-wide grade standards for each of the crop
types. The results are summarized in Table 22. Over all crop types and
for all three market areas combined, the respondents were about evenly
split between strongly agreeing, agreeing, and being neutral with the
establishment of industry grades. Only 6 percent disagreed with the
concept. There appears to be a slightly stronger feeling toward the
need for industry standards for potted flowering plants and bedding
plants than for cut flowers and foliage plants.
A final question asked mass retailers for their opinion concerning
the change in quality of florist crops observed over the five year
period from 1969 to 1974. Over 60 percent of the respondents in the
three markets combined expressed the opinion that quality of cut flowers,
potted flowering plants, and bedding plants was improving (Table 23).
None of the respondents felt ichat quality was decreasing for cut flowers,
while 4 percent and 9 percent perceived a decreasing quality trend for
potted plants and bedding plants, respectively.
The response with respect to foliage plants was substantially







Table 21.--Rating of importance for specific market
activities by responding firms for three
SMSA's, 1973-74


Rating Price labeling Care labeling


Percenta Percent

Not important 6.45 6.45

Little importance 6.45 3.20

Some importance 16.10 32.25

Very important 71.00 58.10

Total 100.00 100.00

percent of total number of firms responding for
all three Southern metropolitan areas.





Table 22.--Mass merchant opinions on establishment
by SMSA, 1973-74


of industry-wide grade standards, by type of crop,


SMSA and product Strongly agree Agree Neutral Disagree Strongly disagree


Birmingham

Cut flowers

Potted plants

Foliage plants

Bedding plants

Total


Memphis

Cut flowers

Potted plants

Foliage plants

Bedding plants

Total


Percent


Percent


Percent


50a

50

46

43

46b




25

20

20

20

21


Percent



25

33

36

21

29b




25

40

40

40

37b


Percent



25

17

18

29

22b




25

20

20

20
b2
21


--

7

3b


--------





Table 22.--Mass merchant opinions on establishment
by SMSA, 1973-74--Continued


of industry wide grade standards, by type of crop,


SISA and product Strongly agree Agree Neutral Disagree Strongly disagree


Percent Percenta Percenta Percenta Percenta

Tampa-St. Pete

Cut flowers -33 67

Potted plants 25 25 50

Foliage plants 14 29 57

Bedding plants 25 50 25 -

Total 18b 32b 50b


Three SMSA's
total

Cut flowers 27 27 36 10

Potted plants 36 32 28 4

Foliage plants 30 35 30 -- 5

Bedding plants 35 30 26 4 5

Total 33b 32b 29b b 4b


aPercent of all responses for respective floral or foliage crop.

Percent of all responses for all types of floral and foliage crops.





Table 23.--Mass merchants opinion on quality of floral and foliage crops for the five
year period, 1969 through 1974


Nature of reported impact
SMSA and product
Increasing Same Decreasing All respondents


Percenta Percenta Percenta Percentb

Birmingham

Cut flowers 100 -- -- 3

Potted plants 64 27 9 31

Foliage plants 40 50 10 29

Bedding plants 69 31 -- 37

Total 60b 34b 6b 100


Memphis

Cut flowers -- 100 -- 7

Potted plants 60 40 -- 31

Foliage plants 40 20 40 31

Bedding plants 40 20 40 31

Total 44b 31b 25b 100





Table 23.--Mass merchants opinion on quality of floral and foliage crops for the five
year period, 1969 through 1974--Continued


Nature of reported impact
SMSA and product
Increasing Same Decreasing All respondents

a a a b
Percent Percent Percent Percent

Tampa-St. Pete 67 33 14

Cut flowers 67 33 14

Potted plants 62 38 -38

Foliage plants 50 50 -19

Bedding plants 75 25 19

Total 62b 38b 100


Three market total

Cut flowers 60 40 -- 7

Potted plants 63 33 4 33

Foliage plants 43 43 14 29

Bedding plants 64 27 9 31

Total 57b 35b 8b 100


percent of all responses for particular floral or foliage crops.

bPercent of all responses for all types of floral and foliage crops.








different. Only 43 percent of the firms noticed an improvement in
quality during the past five years. Forty three percent thought
quality had remained the same and 14 percent felt that quality had
deteriorated.
The responses to this question are interesting and not entirely
surprising. The foliage industry has experienced a phenomenal growth
period during the past few years. For example, during the August 1971
through July 1972 period Florida shipments of all foliage varieties in
3 inch pots were slightly over 15 million plants. For 1974/75, the
shipments had increased 140 percent to over 36 million plants.10 In the
process of this rapid expansion and unprecedented demand, it is highly
probable that quality control was difficult to maintain. Also, the
foliage industry in Florida has been undergoing structural change
with the advent of large conglomerates moving into the production and
distribution of foliage plants.11 This may have resulted in some
short term quality problems. Finally, there would appear to be some
linkage between distance transported and quality. None of the firms
located in the Tampa-St. Petersburg SMSA perceived a deterioration in
foliage quality during the past five years. However, 40 percent of
the respondents in Memphis and 10 percent in Birmingham felt that foliage
quality was deteriorating.


CONCLUSIONS


Results obtained in the survey suggest that mass merchandisers are
a viable and growing market for florist crops produced in the Southeast.
Grower~ and wholesale suppliers of floriculture products should be aware
of this potential and make special efforts to meet the mass market
needs. Specific problem areas appear to be: (a) deteriorating quality
of foliage plants, (b) adequate care during transportation (c) lack of
mass merchandiser knowledge of available plant material, and (d) lack
of adequate retail management training in care and merchandising of
floral and foliage crops,



1Calculated from [2].

1Examples include Stratford of Texas, Inc. and United Brands, Inc.





40


The idea that retail florists and mass merchandisers service
different consumer needs appears to be substantiated by the survey.
Thus one could anticipate that the total market for floral and foliage
crops will be expanded by the entry of mass merchandisers into the
florist business.













REFERENCES


[1] Federal-State Market News Service. Marketing Florida Ornamental
Crops, Part I Summary 1973-74 Season, Orlando, Fl:
October 15, 1974.

[2] Federal-State Market News Service. Ornamental Crops-Florida
Production Area Market, Orlando, Fl: Various issues.

[31 Goodrich, Dana and Urbain Avermaete. "Retailing Florist Crops
Through Mass Merchandising Outlets: Rochester, New York
and Hartford, Connecticut." Paper presented at the Fourth
Symposium on Horticultural Economics, International Society
for Horticultural Science, Veitshochheim, Warzberg, Germany,
September 16, 1975.

[4] Kress, George, "Products in Supermarket, 3: Pricing Procedures,
Sales Results, Firms' Evaluation and Future Plans,"
Florist Review, June 26, 1975, p. 25-27, 67-70.

[5] Powell, Jules V. "Flower Marketing: Changing Market Patterns,"
Flower Marketing--Supplement to the Packer. Kansas City,
Kansas: Vance Publishing Corp., October 4, 1975, pp. 6B,
14B-15B.

[6] U.S'. Bureau of the Census. Census of Business, Retail Summary
Statistics, Washington: U.S. Government Printing office.

[7] U.S. Statistical Reporting Service. Flowers and Foliage Plants,
Production and Sales, 1973 and 1974 Intentions for 1975,
Sp 6-1 (75). Washington, D.C.: March, 1975.




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