The FloristWare website now contains a detailed guide on pricing for retail florists. It takes all of the best and most efficient practices from the discipline of yield/revenue management and shows how they can be applied to the retail flower business. It is designed to help any retail florist become more profitable by moving away from the cost-plus pricing model and embracing the concept of psychological pricing or yield management.
This pricing guide starts by introducing nine smaller pricing concepts that serve as the foundation for the rest of the material. These include a look at the relative merits of charm vs round pricing in retail floral, anchoring and, most importantly, looking at prices in terms of the way customers value a product rather than cost.
The next section applies these basics to a situation florists face all the time – presenting several options to a customer at a time. This might happen when preparing a holiday mailer, etc. The material shows how florist can most profitably price and present three or four options.
A third section looks at the problem of attaching a single price to a product – lost customers and incremental profit on one side, lost additional profits on the other. It then explores how florists can explore an approach that offers one product at many prices.
A look at other pricing models, such as bundling and high-low, makes up the fourth section. The alternate models are very effective at addressing some of the concerns retail customers have when buying flowers. Bundling for example is a great way to address resistance to delivery charges, a sore point for many when it comes to ordering flowers.
The final section looks at how pricing can be used to tackle some of the challenges that are specific to the retail flower business – quoting weddings and events, issues with delivery charges, etc.
The resource is very help for any florist that wants to get past cost-plus and on to a more profitable pricing model. It distills a tremendous amount of research into what can be most effectively employed in the flower business.