What are flower wire services, how do they work?
In order to answer this question, we would like to explain the history of how they became into existence and get into a brief detail on how they work.
Flower Wire Service was created in 1910 (genius for its time) – a group of 15 United States Florists set out to create the Florist Telegraph Delivery Service.
Participating members exchanged business via Telegraph messages, hence the name Wire Service.
In addition, Florist Telegraph Delivery Service, better known as FTD, other companies saw an opportunity and jumped on this ever so popular bandwagon.
Floral Wire Services had their origins in the days of the Telegraph
Flower Wire Service, How It Works
Customers can purchase from a Broker (Wire Service Provider) on various wire service companies websites or by calling them. Once an order is placed it will be sent to a local flower shop in the area of which the recipient resides to be filled and delivered.
Flower Wire In
The Broker (Flower Wire Service Provider) will keep the customers (Shipping/Service Fees & Taxes) and send the filling florist a total amount in which to fill the order.
Here is a general breakdown on how flower wire in payments work.
(Some flower shops request a delivery fee rather than take it off the top – if you are a flower wire service member please request additional for delivery)
- Mixed Vase Arrangement (Wire Service Provider Website) $49.99
- Shipping/Service Fees & Taxes $30.00 (for same day delivery at 9:40 am on a Wednesday – less $7.00 for next day delivery)
- Total charged to the customer $79.99
- Total issued to the filling florist $49.99
- Total paid to local florist at the end of the month $49.99 x 80% (this is a generalized percentage rate take note some wire service companies pay less) = $39.99
Florist you do not pay tax on flower wire ins!
Flower Wire Outs
If you are the sending florist and are sending to a flower shop, you will receive 20% and keep the customers delivery fee and tax (Some florist extend half of the delivery fee to the filling florist), this is ultimately your choice.
Florists you do pay tax on flower wire outs!
Typical Fees Charged by Wire Services
- Membership Fees
- Advertising Fees
- Floral Product Fees
If you owe for hardware (computer, printer, cash drawer, receipt printer) expect this to also be included in your bill, generally hardware takes years to pay off.
Note: All membership fees and other fees will come off product filled payments owed to you. The filling florist with most wire service providers will receive a check or bill at the end of the month. Expect a bill if your filling products did not cover all of your fees.
Should you join a Flower Wire Service ?
- You have the choice – No longer in the flower industry is joining a flower wire service mandatory.
- The telegraph has come and gone and we now have the internet which allows customers to find florists all over the world.
That being said – joining a flower wire service is personal decision for your flower business. Reviewing your monthly statement is key -if you are making a monthly profit then we say go for it – unfortunately many shops do not and end up breaking even if they’re lucky.
Important Tips – with most flower wire service providers, please be sure to confirm filled order delivery’s before the allotted time – cancel orders you can not fill in a timely manner, you will get charged for any delays with the wire in order processing regulations.
Florist please give your advice to our readers on your experiences with flower wire service.
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There are a whole bunch of negatives and positives about wire services. Your older several generation 3 shop towns are negative, the shops starting in suburbs being built with over 500 shops in a metro city are positive of having wire services. First, you have to decide what type of town you are located in. Second, you need to do some local research of the area as far as what generation is living in the area, what level price point are the homes in the area, what is the income level? (type of vehicles says alot!) Third , what type of industry is in the area? (hospital district, energy , technology districts, malls, quaint shops/restaurants, skyscrapers, etc.) If millennials are heavy in area, they are constantly in iphone mode, you will find 1 out of 100 walk in your shop, they love ordering everything on that phone! so wire service will be great for you…they do order flowers or 1st time flower buyers believe it or not! Younger baby boomers (1964-1954) Buy around 5 times a year. They love googling ….they will either come to your shop or order on line from your website, if you are not near them forget them coming in to see you, they will just order online from blinking lights (WS). Very rarely will older boomers (70’s-80′ year olds) order over the internet, they will call or come to you with walkers right around Christmas & Easter. If you do decide to get WS, only put biz card in envelope and strickly follow the recipe book on every order!!! Always ask for a delivery, if they cancel order you didn’t need the stress anyways…Right in holiday area they will give you delivery. Oh! One last important tip…DO NOT FILL BELOW YOUR SET MINIMUM, if you do you will start to loose money! Good Luck in your decision for your business!
Great breakdown for those who want to know how the services work.
In terms of what percent the filling florist get’s to keep, it’s actually less than the 80% listed in this article. All the major wire services FTD, Teleflora and BloomNet pay 20% to the sending florist and keep 7-10% for themselves (clearing house fee). They also charge a per order transmission fee of about $2.
So Total paid to local florist at the end of the month $49.99 x 70% = $34.99 – $2 Transmission Fee = $32.99
Our shop only has 1 wire service (FTD) and we do a good amount of volume with them. That being said we have to be careful during major holidays not to over extend ourselves on wire orders and end up having to turn away full paying customers.
We try to keep wire services at no more than 10-15% of our total sales (we recently quit bloom net in order to reduce our wire sales as a percent to total.
On the Pro Side, it helps to keep us busy when we may otherwise be slow and helps me keep additional designers on staff.
On the negative side, The “order collectors” such as AVAS, Wesley Berry, Etc… most of these people don’t know the difference between a Hydrangea and a Spray Daisy, we find that they often charge the customer much MUCH more than they send to us. You need to document exactly what you put in every arrangement because the photo’s on their websites often are over value or have all the flowers shown on the front of the arrangement…. so the customer is expecting a much larger arrangement than what they will receive and when they complain you need to be able to provide documentation to the wire service that you filled the arrangement to value and/or recipe.
Finally, if you do FTD and REJECT a lot of orders (or any orders for that matter), understand that you are being charged that $2 per order transmision fee even on the orders that you reject. When you get your statement each month, call customer service and ask them to refund the transmission fee for cancelled and rejected orders and they will put a credit on your next statement. This saves me about $70 per month and during valentines and mother’s day it’s $200+ as we REJECT a LOT of orders.
I cant stand the wire service…all they do is suck u dry.They come in and sign you up..then when the billing comes..they get absent minded.They also don’t tell you about all the fee’s that come after the trial periods. They lie so much…they believe they are telling the truth.Stay away from the shark infested waters.Beware…!!!
I think of a wire service as a tool. Like a hammer or electric drill. Depending on your needs determines what tool you need. Do you need a black and decker corded drill for $19.99 that has limited functionality or a Makita brushless 20volt comercial grade costing $399.99?
If used properly they can help you make $ if not then will drain you dry. You should not to look at a wire service to bring you business via wire ins. That is how they sell it but not what you should rely on. We belong for the website. Marketing, technology and ability to send orders out of our delivery area. I do not have time or the expertise to manage our website and technology pays for itself. Remember you only need one good hammer to drive a nail.
If you belong to a wire service…and especially one that you process your credit cards through…be sure to monitor your fees and expenses every quarter to be sure you are getting a fair shake. What happened to my company over many years is that I found that while initially clearing my credit cards through the wire service in the early years went from being a smart move to a not-so-smart idea. Over time, we recognized that more and more folks were ordering online and/or calling distant flower shops themselves. This caused our wire-out business to slump over time as more and more people were making the call themselves. We also recognized that more and more folks were using credit cards rather than in-house accounts since they get reward miles or points.
With a popular wire service out there now, the credit cards are offered with 0% clearing fee UP TO your sending dollar-volume. What happens after you hit your threshold? Those clearing fees become extremely expensive, and any savings are quickly (and quietly) eaten up. So for us….our clearing fees skyrocketed with less outgoing orders…and with more cards to clear. I did the math…and found that my regular bank offered their merchant services for far less (by 1.5%) than what I was paying the wire service. And besides, I was paying the wire service close to $2,000 a month just to clear my cards…and it wasn’t hard to determine that it was a losing deal. With my regular bank, I also negotiated my 6.5% business loan down to 4.29% with the promise of moving my merchant account over to them. Not only do I save a nominal $100 in annual administrative fees, but my clearing fees are greatly reduced for each charge, and I save a huge bundle on business loan interest. Your merchant account is a huge asset. Use it to your best advantage. If you clear your cards through a wire service, offer it to your bank…and use it as leverage!
Now on to the service. Here we were paying all those fees…membership, advertising, this fee, that fee…etc…all for business that gets you 70% of your delivered order. Understand that the best run shops are lucky to realize and clear a 10% overall profit after taxes. You see the problem… Why would anyone want to pay out 30% of their business when they don’t even clear that much profit…and that’s just on the commissions…not including all the fees….and paying more for the credit card clearing than they have to! It was a no-brainer for us to opt out of wire services.
Now on to exiting the service. If you decide to quit the wire services, read and understand the terms and steps that have to be understood and taken. In the wire service we were in, it called for notification to exit…and that it must be received by a certain date to be sure you are excluded from the next directory…or you are held liable for all directory expenses for the life of that particular directory….usually three months. Such as was in my case, I missed the deadline by a week or so…so I had to live up to the terms. The terms state that you are held ONLY to those expenses related to the directory….the directory fee and advertising fees…NOT those fees associated with credit cards (unless you keep the program for the remaining time), membership, quality control, etc. These examples are not directory expenses. The wire service issued our final bill…and it came to nearly $2,000.00. I quickly noticed that we were being billed for ALL expenses for the entire three months because we were in the directory. After several letters and phone calls, I finally got the wire service to live up to their own written terms (found in the small foreign directory) that we be charged ONLY for directory fees….and my final bill was reduced from $2,000 to $220.00. They argued…but was to no avail because I was just pointing out their own terms… Don’t let them push you around.
good, Great breakdown for those who want to know how the services work.
I am a florist and would like to hear about your wire service
I would like to know how to start business in floral connect to wire services