Stock market crash shouldn’t worry floral businesses too much, said the Society of American Florists’ Chief Economist Charlie Hall, Ph.D.
“There have been plenty of circumstances like this — like we’ve seen over the last week,” Hall said during his keynote address at SAF Miami 2024, SAF’s annual convention which kicked off today in Miami.
“The stock market is not the real economy. The stock market goes up and it goes down based off of expectations.”
Keep Perspective
Today’s economic environment requires a similar long-term perspective, Hall told an audience of about 490 people. He noted that while short-term economic data such as the recent increase in job claims and a lower-than-expected jobs report might suggest instability, these metrics alone do not capture the overall economic trajectory. Instead, Hall urged viewers to consider longer-term trends, highlighting that U.S. GDP growth has remained relatively steady despite various economic shocks, including the Great Recession and the COVID-19 pandemic.
And, he pointed out that the Federal Reserve isn’t panicking. Despite recent volatility in job reports and market performance, the Fed’s decisions to raise or lower interest rates are driven by broader economic conditions rather than immediate market reactions.
Floral business owners should also make strategic business decisions based on long-term business sales patterns. For instance, Hall referenced data from SAF’s Economic Outlook survey that shows flower sales are up from 2019, even though this year many respondents reported that their sales were down over last year.
“If you look at year-over-year sales and you try to make strategic decisions that are going to impact the long-term nature of your business, you’re in trouble,” Hall said. “Do not fall to that. Instead, you got to know enough to know the difference and see your performance over time and be measuring that historically.”
Strategies for Sales
In her State of the Industry Address, SAF CEO Kate Penn shared strategies that successful florists are using to bolster sales: providing great-quality flowers that last, using superb customer service as a competitive advantage, building a strong team that feels appreciated, and embracing change.
“There’s an openness and an embracing of change among some people experiencing growth,” Penn said. “They are trying new things, seeking out new partners, and making shifts in their staffing.”
All in an effort to capture a larger share of consumers’ wallets —consumers who, Hall said, are still spending. Despite recent economic uncertainties, consumer spending on discretionary items such as flowers and recreational goods continues to demonstrate a capacity for growth.
Looking Ahead
Is a recession still looming? Hall acknowledged that while some economic models predict a heightened probability of recession, these forecasts should be interpreted with caution. Historical patterns and current economic fundamentals suggest that, despite some risks, the economy remains on a steady path of recovery and growth.
His advice? Leverage customer analytics, refine your value propositions, and maintain a focus on the health and well-being benefits of flowers, a key area where consumers are likely to continue spending. “ will always pay you for something that enhances their health and well-being,” Hall said. “And we’re all about that.”
read more: https://safnow.org/2024/08/07/