Silk Floral Stems Trend:
An Interview With Aldik's CEO...
Was he right?
What was happening in the silk floral stems market, and the artificial flower industry in general?
Manufacturers
began offering enhanced high quality floral stems and related products,
a much expanded selection of colors and categories — but would they be
readily available to silk flower arranging enthusiasts?
The CEO of Aldik Artificial Flowers shared his insights in this 2005 interview.
Reprinted with permission.
The State of the Floral Market
A blunt conversation with Aldik's Larry Gold.
Interviewed by Mike Hartnett, Creative Leisure News (February 7, 2005)
(Note:
Larry Gold is CEO of Aldik Artificial Flowers. He graduated from UCLA
in 1975 and joined Aldik the same year. He held many positions within
the company, including office manager, computer programmer, and import
manager, working his way to the President of the company in the early
1990’s. Mr. Gold is one of the founding members of the American Flowers
Importers Association (AFIA) and was a charter board member from
1994-1997.)
CLN: How would you describe the recent history and current state of the silk flower market?
GOLD:
I think the silk flower market is in good shape at the upper end. Good
design, good quality and trend-forward looks are selling very well.
Because of the increase in sales of pre-made arrangements the last
couple of years, I think the industry has taken their eye off the floral
stems market. But Aldik has concentrated on the stem florals as well as
the pre-made product, and we have seen big increases in sales of both
types of product.
CLN: So your recent product introductions reflect your thinking?
GOLD:
We introduced Chelsea Cuttings in the summer, mainly roses and peonies
and gardenias (long and short stems) that look like they are cut from
the garden and can be put into water to give a truly realistic look. In
addition, we introduced Chelsea Cuttings Fragrances that can be put on
the flowers to give a truly realistic fragrance to the flower. They can
either be put on the flower head or into the water, and they truly
complete the illusion from silk to real. Very realistic fragrances that
are not overpowering.
We introduced a new Citrus Garden line of
floral stems and containers that were incredibly successful. They were
in the Lemon, Lime and Tangerine colors that are very popular now. This
has been one of our best introductions.
At the recent winter
shows, we introduced a new palette of colors, Sonoma Gardens, that takes
the citrus colors to a more sophisticated and classy level. Lemon
becomes gold, lime becomes avocado, and tangerine becomes paprika. The
response has been great, and we expect this line to be a big success.
In
addition, we introduced a line of floral stems and containers in brown
tones that match almost any color. Most brown tones have either green,
yellow or gray in them, and it precludes them from blending with the
other colors. Our Warm Neutral line is a neutral brown line that goes
with greens, blues, whites, and yellows, and virtually any other color.
It is a classy, upscale neutral brown line that goes with almost any
decor.
CLN: Are you seeing craft stores shrinking the size of
their floral departments in order to make room for categories such as
yarn and scrapbooking that are currently growing? If so, doesn't that
almost guarantee floral sales will decrease because the consumer has
less to choose from?
GOLD: Yes. While some of the consolidation
of the departments was warranted, I think for the craft stores to
succeed in the silk floral business, their offering needs to be fairly
broad. They need to offer various price points, and some medium to high
quality floral stems in addition to the basic color lines. In addition, a
new color or trend theme needs enough components shown to make a
statement. The shrinking floral departments are being done at the
expense of the better quality floral stems, and this is making the
floral offering much less interesting and more lower-end.
CLN:
Retailers seem to be constantly trying to lower prices — and pressure
vendors to do the same. Is there a danger that the ultimate result will
be poorer quality florals that the consumer rejects?
GOLD: That
is already happening. As the price-point and ultimately the quality in
the department decreases, the sales decrease. The department may sell
more units, but that just increases their transaction costs, and the
sales figures are less. Consequently the profit in the department
decreases and there is further pressure to decrease the size of the
department.
CLN: Some retailers try importing, thinking that by
cutting out the middleman, they'll improve their margins. But doesn't
this just create new types of problems for them?
GOLD: It
increases their margin. It also puts all of the inventory risk on them.
If they don't buy enough, they will lose sales and profit. If they
overbuy, they will have to dispose of excess inventory and they will
lose profit. If they put the inventory burden on the importers and buy
domestically, they will lose some margin, but completely eliminate the
inventory risk, and ultimately net a higher profit. Also, if they deal
directly with the factory, they lose the design ability that the
importers provide. The importers are the designers and innovators in
this industry, and by dealing direct with the factories, the retailers
lose this.
CLN: Maybe years ago when the quality of imported
florals was poor, crafters used to make and arrange florals. Then as the
quality improved, consumers just arranged the florals. Is there a trend
now that consumers are buying silk flower arrangements?
GOLD:
Consumers are buying silk flower arrangements, because the quality is so
much better than before. But, in addition, the trend is that when
consumers do their own arrangement, they are not necessarily 'arranging'
it. They are buying several stems of a high quality flower and placing
it in a vase, the same as they would do with real flowers. They can even
put water in the vase, and the 'arrangement' will appear to be real.
This only works with high quality stems, and I think the craft stores
are missing the boat because they are buying less of these quality stem
florals than ever before.
CLN: Where should the floral industry
go from here? What do retailers, vendors, and trade associations need to
do to improve sales?
GOLD: I think the floral industry is going
in the right direction. I think the demand for quality is increasing,
and the price points are rising. The craft industry is running counter
to this trend, and I think that is hurting their floral sales. Aldik has
spent a lot of effort increasing the quality and design of our silk
floral stems, and as a result our increases in floral sales at the
recent trade shows were up by over 28%.
Thanks to Mike Hartnett, Publisher of
Creative Leisure News,
for granting reprint permission of this interview about this trend in silk floral stems.
Be sure to explore the entire site for interesting hobby industry news and craft-related articles from his newsletter.
Looks like Aldik and Larry Gold were on target as to what consumers
wanted — and still want — to see in silk floral stems: more realism, a
broader range of colors, and truer floral scents. You were right, Larry.
Applause, everyone!
I only hope that you and I can find these
high-end artificial floral stems at our favorite craft stores or silk
flower shops. I want the good quality stuff, and I don't mind paying a
bit more for silk floral stems that make people look twice at my silk
flower arrangements — and have them coming back for more.
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