In the third column of a special five-part series for wholesalers, leading Dutch retail florist and florist trainer Ton Verzijl explores marketing's 4 Key P's: product, price, place & promotion. This month: price.
"Traditional wholesalers repeat after me: 'My flowers cost more than flowers sold online!' There, we said it. It's no secret after all, and certainly nothing to hide from your customers. In fact, I advise the opposite: be open about higher prices with your customers. Why? Because today's successful wholesalers have evolved: still traditional product suppliers, but now also modern service providers. Yes, your prices are slightly higher, but unlike online sellers, yours are 'added-value prices'. Service, information, expertise, guaranteed product quality… are just some of the added values you offer your customers that online sellers do not and cannot!"
Positive approach
"Unable to consistently compete with online prices, the successful wholesaler must effectively communicate to his customers exactly what added values and benefits are included in his prices. Market the added values that are tied to your prices. Take a positive approach. Not, 'we can't compete on price', but rather 'quality and service pay for themselves!'. These added values must not be hidden from your customers. Your customers are paying more, because they're getting more!"
Niche market
"Many wholesalers thrive once they've found a niche market that values more than just price alone. Identify the lucrative customer group you most want to serve, and then specifically tailor your business to satisfy their needs. For this, the 70/30 rule applies: 70 percent of your business comes from 30 percent of your customers. So who are the bigger-spending 30 percent who are willing and able to pay for the added values in your prices?"
Creative value
"Once you've identified this 30 percent as, for example, your 'top 25 customers', nurture them caringly and creatively. Discounts, gift certificates for the month's biggest buyers… but also creative added values like the workshop my wholesaler recently invited me to: the subject was helping retail florists land more corporate clients. With this workshop, my wholesaler not only provided me with much-appreciated added value, but also, by helping me grow my own business, he ensured that his business would also benefit when my corporate flower orders increased."
"A wholesaler is an expert. Dispensing professional advice is also part of the total added-value price. Nowadays, wholesalers mustn't assume retail florists are horticultural experts, because increasingly they're not. Take for example the two young US 'florists' who recently asked my advice about starting up their new flower shop. Neither of them knew much about flowers; but they did see flowers as an excellent business opportunity. In such cases, paying for a wholesaler's added-value knowledge would be crucial for a retail shop's ultimate success."
Quality counts
"Customers will pay more for quality, but do customers actually recognize quality flowers? What characterizes a grade-A rose or gerbera? How long from bud to bloom? Continuously educating retailers about the guaranteed flower quality they're paying for is a wholesaler's primary job. These appreciative retailers then pass this knowledge on to their customers, who learn to appreciate the quality they're paying for. In the high-end, premium follower business, success is driven by more than price alone. Never let your customers forget that!"
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