How to Plan a Strategic Hotel Floral Budget

Updated: Feb 10, 2020

The best laid plans for even the savviest of business owners rarely include a budget. And while they may have a line item in there for flowers—no one has any clue how to lay out a strategic floral budget. Much less what could be possible if they planned and better budgeted for said budget.

Flowers are traded live daily at auctions similar to if you were currency trading live on a platform. In fact, I actually buy all my flowers online through different floral trading platforms to shop price and quality. Due to this, flowers fluctuate in their pricing as the auctions are based off supply and demand. Then when you add in location, this also affects price as the cost of logistics come into play.

As you start thinking of your floral budget, it's important to remember it's not just the flowers you are paying for. That is obviously the meat and bones of it but there is a large human element that comes into play. Labor is just as expensive as product. From collecting boxes of flowers from your local wholesaler (essentially your "broker") to the final install, there are countless hours behind the scenes including designing, ordering, troubleshooting, receiving, conditioning, breaking down, installing, resetting, etc.

When it comes to planning strategic floral budget for my clients, I first take a look at their brand standards, lists of wants and on-hand resources. This helps me understand my parameters better as well as if we have any room for extras. Then I develop a budget taking into account seasonal pricing, maintenance requirements, any logistic issues or bonuses as well as adding a contingency incase there are any surprises over the next 52 weeks.

Seasonal pricing could refer to a hotel, such as the Baccarat Hotel in New York, who's staple are red rose pave spheres. It is 100% guaranteed that the pricing they receive in August for their roses is going to be completely different than in February. Side note, I'm sure they already have an annual commitment to lock in the best price (at least that's what I would recommend). Seasonal pricing can affect something as simple as roses for In Room Dining. One week it's budgeted to pay $1 a stem and for two or three weeks you're paying $3 a stem which will impact the bottom line, especially when you are buying dozens of roses.

Maintenance requirements could include hotels who prefer only clear glass vases. While this is beautiful, we as flower designers unfortunately cannot control mother nature (as much as we'd all like to). Therefore a team member must go in at least once if not twice a week to ensure the vase is always clean and the water is always clear. Because what guest wants to check in next to a vase full of murky water? Not this traveller! Designing according to how much maintenance will be required is key to keeping your budget in line as labor hours do add up.

Lastly, logistic issues or bonuses are key! One issue might be only being able to design and install in the wee hours of the night. Logistics then begin to add up when it comes to receiving and storing the flowers. The cost of labor is time and a half, easy, for "out of work hours". Now logistical bonuses are my favorite. This is where I can save my clients money and/or put more money to their actual florals. Recently I identified a dead space inside one of our hotel client's back of house and a four hour window of an unused kitchen. My suggestion of moving the floral operations "in-house" saved this account thousands of dollars. Not only is new ownership happy but the floral designers have a much easier job now. We have to remember, time is money and if we can cut down on time, then we can cut down on the spend.

Year over year the floral industry experiences an inflation rate of about 3%-5% on average. There was a year that I had a 15% increase YOY (year over year). One of the key reasons was logistics, which include the trucking, airline and distributor sectors, which also fluctuate based on the activity in the oil and gas sector. For domestic flowers, sourcing comes predominantly from the West Coast and with the recent legalization of marijuana at that time, flower farms were being sold (like wineries) to handle new crops which left less supply to handle the demand, hence prices went up. There also had been the problem with fires and floods which again affect production as farms are damaged, decreasing supply and increasing the demand resulting in price increase. On top of that, the Agricultural Department increased their tariff and all these extra expenses were being felt in that 15% flower price increase. 

It becomes easier to understand and properly plan a strategic floral budget with an experienced partner. Taking into account what items to keep in mind and always keeping a contingency for economic factors. To learn more about my process and the services I offer, click here.

To learn how you can create partnerships between your floral design business and luxury hotels click here.

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