Whether or not we are actually facing an economic recession here in the United States, we are being squeezed by inflation and still seeing the various impacts of the events happening these last few years.

I know in our household: gas isn’t going quite as far as it was. In fact, I recently read an article naming our area one of the top highest gas prices in the nation. In just the last couple days we’ve been watching the price go up once again. We’ve been using our wood burning stove more than ever for the cold winter to lessen the financial burden as we continue to run coolers and heaters for the flower farming operation. We are making eating at home a priority and even (gasp!) making our own coffee… well a little more at least.

Joking aside, in our personal lives, we are focusing on trimming the fat from our spending, so to speak. This isn’t necessarily a bad thing: being more responsible with our hard-earned money. I have been noticing a trend occurring with our customer base though as well: they too are trimming the fat from their spending.

As much as I would prefer to believe otherwise, cut flowers seem to be one of the first cuts. Cut flowers also seem to be a substitute for other pricier gifts or vacations. It’s an odd space since really, it can go either way.

During the pandemic, I questioned whether or not cut flowers, especially from small local farms, had a place in the world where people were facing uncertainty in the stores, their jobs, their health and their social habits. I felt then that the world needed beauty and joy that cut flowers can bring. With the added bonus of the global market being shut down… it was the local flower farmers’ time to shine! This turned out to be incredibly true!

Firsthand, we saw sales soar. There was still disposable income, perhaps even more, to share with supporting small businesses with trips being cancelled and being shoved indoors. Something pretty to soothe and look at was needed. Flowers were sought after.

Here we are in another unusual situation.

Seeing the cause and effects from the past couple years. I find myself toying with a question:

is there a place for a small scale flower farmer in a recession?

Global flower chains have recovered but even those once “cheap flowers” from Columbia and Ecuador have increased in prices but are still managing to be more affordable than our eco-consciously and humanely grown flowers. . . At least for the moment.

Since the early eighties, the global cut flower market has shoved many domestic growers out of the business, many moved their business to those southern growing regions or forced growers to pivot and refocus on more specialty cut flowers to grow that don’t store or travel well. Two of these three options seem to potentially be on the table for even us small scale growers at the moment. If not now, the historical economic trends suggest that as a flower farming business, we will inevitably face a challenging economic time at some point in this venture.

Our little flower farming business is beginning to feel the strain of a struggling economy: over $5 a gallon for fuel was just the beginning and that alone is putting us back to the drawing board for product offerings and delivery. Increased prices on: seeds, tubers, bulbs, corms, substrate, fungicides, compost, packaging materials, shipping costs and so on. Overall, there wasn’t an increase that did not affect us and I’m know we are not alone in this. Compared to sales the last couple years, we are seeing a decrease in everyday “kitchen table” offerings but an increase in custom orders and events.

When customers who are purchasing everyday flowers are feeling the squeeze just paying $5 for a half rotten head of lettuce, are they finding enough value in purchasing our flowers?

With our costs going up, can we balance having profitability with more budget friendly products or do we put all our eggs in the more premium services basket that demand a high price point such as weddings?

When the price of groceries are going up, will even the “cheap imported” flowers continue to be in demand?

How can we be profitable in our flower farming journey?

Let’s explore this topic more together!

Past recessions and cut flowers

First thing’s first, I wanted to read up more on past recessions here in the United States:

What events happened that caused them?

What were the consequences?

Did it effect people purchasing cut flowers, especially from growers in the United States?

After all, it is more expensive to grow here in the United States than some of the other countries who regularly import to us.

Oh boy… I went down the rabbit hole.

Real quick friends, let’s define an economic recession. According to Merriam Webster’s Dictionary an economic recession is “a period of reduced economic activity.” Fairly simple. The things in life that seem simple enough though, are often the most complex. There is quite a bit of debate around the full definition of an economic recession, how many quarters going down, what causes it, how to solve it, etc. Here we are as small business owners who don’t want to have to puzzle our way through any of this gunk but alas, we need to know the basics. I was curious of the past recessions, the types and the impact they had in society. Now, I am not claiming to be an expert in this area, economics are intricate. I am also not a historian. I need to wipe some dust collected on the parts of my brain from taking economics back in college but I will share what I have found in my research and try to define it as simply as possible.

There are different types of recessions, four main types seems to be the common consensus:

Boom & Bust Recession

This type comes on the coattails of an economic boom. Basically, the economy can’t quite keep up, inflation ensues and the growth becomes unmaintainable. The Boom & Bust cycle seems to be quite continual, which makes it relevant for any small business owner to be aware of. Here is a a great article laying out some historical examples in the United States along with further defining the pattern and recovery. Basically the cycle goes:

BOOM > END OF BOOM > BUST > END OF BUST

For the business owner, being aware of where the economy is in the cycle can be helpful to help you navigate difficult decisions for your business.

During the “boom” phase businesses see expansion. At the “end of the boom” is where you will see peak in sales. The “bust” is where it hurts and can get a little scary to a small business owner. It is the part of the cycle where we start seeing consumers clench tighter onto their money by decreasing their discretionary spending and some small businesses don’t survive or minimally need to let go of employees to make ends meet. Lastly, at the “end of the bust” is the “trough” phase which is where you begin to see the economy heal and expanding once again. Understanding this cycle and recognizing the different phases is imperative for your flower farming business to not only survive but to thrive. For example, focusing on expanding while in the “bust” phase may not be the wisest but getting lean and pivoting your offerings can be a better focus.

Balance Sheet Recession

We saw this type of recession not too long ago with the “Great Recession” here in the US back in 2008. Basically, this type of recession is where the bank’s balance sheet is… well out of balance. Giving out bad loans resulted in bank’s not having cash to be able to lend out. A real simplification of this recession. This type is not a fun one. It takes a long time to recover and there is not much that can really be done about it plus it leaves the economy vulnerable to a false security or rather a “double dip” recession in where prospects look good and then the economy slides back into a recession. This type of recession played a hand even in the “Great Depression".

With the events that are currently happening, are we potentially looking at a repeat, or in the least dealing with the repercussions of people’s fear of one? I don’t know. Hopefully not.

This is where running your flower farming business lean and debt free is imperative to prevent getting caught up in being over extended with debt or running an unmanageable operation.

Depression

The word “depression” is never attached to anything good. The definition of “depression” according to the Meriam-Dictionary is “a period of low general economic activity marked especially by rising levels of unemployment.” As just mentioned and a time period we are fairly familiar with is “The Great Depression.” We have been seeing the cycles of Boom and Bust, we are seeing interesting things play out in the market with a huge boom and then hiked interest rates stalling the market, we are seeing strains on supply chains and food chains. Some believe we are heading into a depression. I certainly hope not.

This is where hoping for the best and preparing for the worst comes into play. How can you make your flower farming business more lean to survive even something as horrible as a depression? Home gardens and being lean got many families through these difficult times historically. This is where slow and steady can really help your flower farming business. Focusing on more budget friendly varieties and products, being careful to not do huge projects or expansions that may put you into debt.

Supply Side Shock Recession

This type of recession is caused by typically things out of our control. Natural disasters, pandemics. This was seen in the 1970s when oil prices skyrocketed. Basically this recession happens when prices soar on supplies needed for quality of life. This results in a “stagflation” which Merriam Webster’s definition is: “persistent inflation combined with stagnant consumer demand and relatively high unemployment.” This creates a lower output of the product due to less demand which results in higher inflation.

The difficult part about figuring out what kind of recession we’re in (if any) is that it tends to be defined afterwards. Hindsight is 20-20 I suppose.

At the moment… some experts are suggesting we are looking at a combination on all of the above. Talk about throwing the kitchen sink in.

The Flower Industry & The Economy’s Health

This was a particularly interesting deep dive on the internet to sift through. Some articles suggested that flowers are recession proof while other articles greatly disagreed, then there were some sitting in the middle. If you want to take a peak at some of these articles, they are linked at the end of this post. As mentioned in the beginning of this post, flowers are a luxury. Even though we could argue all the wonderful benefits as to why someone needs flowers: flowers take some discretionary spending. If it comes to filling one’s belly or having some pretty flowers: food is going to win. Historically the types of commodities that survive are necessities and vices. Food, clothing, household products and alcohol. More currently, sugary drinks, processed foods and fast food restaurants have shown to thrive during a slowing market. In our more modern world, yes flowers are a luxury but they are a more affordable luxury than a trip to Hawaii or a fancy meal out.

This is where flowers are a bit of an unpredictable space… an odd space. It will depend on your target market, your customer base, your business operations and product offerings.

My opinion, after researching and my experience as a farmer-florist for the last eight years, is that flowers are very intertwined with the economy’s health. This doesn’t mean flower farmers and florists can’t survive or even thrive during harder times. Think if it as an opportunity to reassess your business operations and product offerings.

Growers and florists can survive, at least those who are willing to change their approach and products. Those that are paying attention. I don’t love watching news, I don’t love hearing the negative. I would rather stick my nose in a sweet pea and shut the world out. That isn’t reality and if I want to keep growing those sweet peas… I can’t stick my head in the mud.

I am writing this because I don’t want you to stick your head in the mud either. Even though this isn’t a fun or glamorous topic: it is relevant.

Before getting into some solutions, let’s understand the cut flower industry’s history a little better.

The History of the Floriculture and Floristry in the US

During a Sunday morning coffee date with my good friend, who also happens to be an amazing history geek, I began telling her about my beginning venture into researching the history of flowers as it ties with the economy. Instantly she lit up… because history… but also flowers…she began telling be about the Lompoc Valley in California.

It is a beautiful valley that has a cautionary tale for us flower growers.

Before we get to the time where Lompoc Valley shined bright in the cut flower industry it is important to know some basics of the history of the cut flower industry here in the US. To keep this on the more brief side, I’m going to keep to more modern times. Let’s go back to when the west coast of the United States was pretty much the Wild West.

Modernization of the Cut flower Industry in the US

What feels to be eons ago, cut flowers were predominantly grown close to the cities that they were provided for. Mostly the northern east coast. Think New York and Pennsylvania. Before refrigeration and railroads, flowers were grown nearby. Those flowers were also the more heirloom varieties, many of the varieties we focus on growing today as flower farmers: cottage style flowers that are best cut and sold locally such as sweet peas. The thing is… growing in those areas can take quite a bit of resources such as heating greenhouses.

Fast forward to when trains were the happening thing: California and Florida were booming with agriculture. Thanks to the modern technology of trains and refrigeration. It quickly became cheaper and more reliable to bring cut flowers in from California and Florida. Warmer weather saved a lot of hassle and had lower costs into it, plus it took having seasonal flowers into making them available more year round. This was the first evolution of “imported” flowers in the United States, they were simply brought in by other states. Great for consumers less great for those growers in the north eastern US.

In the seventies is when we saw the Lompoc Valley boom for cut flowers and more so, seed production. A huge crop for the area were sweet peas, zinnias, marigolds and many of our other favorites.

As we approached the eighties and early nineties another evolution came about. Reagan, in an attempt to win “the war on drugs” imposed policies that have drastically changed the specialty crop industry. The thought was: remove tariffs on imported vegetables and cut flowers from South America to promote their population to focus on necessity products or nice products in lieu of drugs. Well… we know that didn’t go as planned. It ultimately sunk many US growers or forced their hands to move operations to South America. The kicker is, from moving flowers across the country all the systems were already in place to make this a fairly easy and cheap transition. Even using old aircrafts that were outdated found new purpose with importing goods from South America. Talking about the trade-offs that happened is a tale for another day but this did change the industry.

Lompoc Valley was limping along and over the years, dwindled. Today it is a small echo of what it once was. Acres upon acres of flowers had once covered the valley, now outside of a couple operations, it is desolate. Many of the growers in the Lompoc Valley closed their businesses or began working for larger operations and even moved to South America themselves. Year round growing with lax laws and cheap labor… it came down to the dollar.

As small scale growers we know, the global cut flower model is not ultimately sustainable for the long run. We have been watching the cookie crumble since the impact of 2020 events on the global cut flower industry. They were trashing millions of dollars worth of product while us small scale flower farmers were running our operations still. We were able to adapt and pivot, even during lockdowns.

This brings us to today. Global chains have recovered but it still isn’t what it quite was only three years ago.

There is once again a shift brewing in the air.

what to do with the current trends?

As mentioned in the beginning, we’re feeling the effects of financial strain. We are getting more budget concerned couples this year compared to the last couple years. Not all, but more than usual. It is reminding me of our early years where it was burlap, babies breath and mason jars everywhere kind of vibes… which makes sense since that trend came on the coattails of “The Great Recession of 2008.” People are spending but with more hesitancy and caution, also not without mentioning the fact that prices have gone up for everything… yes including our products too.

So what do we do?

First, don’t get discouraged or fearful. During past recessions when it came to the survival of flower farmers and florists: innovation, getting lean and overall being high skilled and valued by your customers.

Get Lean

After reading on the history of the floral industry and agriculture coupled with looking at the elements that created past recessions: this is the time to be fiscally responsible. Not going into massive debt to get that heated greenhouse or storefront shop. Budgeting out your flower farming resources. Being conservative in hiring employees. Being a debt-free business outside of paying for that land or mortgage.

We decided for this season to get lean. No employees, except for freelancers for weddings, no vegetables or edible flowers to save on the crazy expensive insurance we had to carry for that, along with weighing our impulse purchases (my impulse purchases…). I also went through and purged memberships and subscriptions that I hadn’t used in over a year. Why pay for something if you don’t even utilize it? Instead, we decided to focus on finishing some started projects that we already have the supplies on hand for, to continue offering diverse products through bouquet subscription, weddings, and business accounts. We are also greatly looking forward to growing vegetables for ourselves to greedily enjoy this year.

Value your customers, they in turn will value you

Have you noticed all the big corporations revamping their loyalty programs lately? That is because it is five to ten times cheaper to keep a current customer rather than attain a new customer. A loyal customer is also going to spend 67% more with you than a new customer. Get creative to ensure your current customers feel loved and appreciated. Creating your own rewards program, having an on-the-farm special dinner for subscription members, surprising them with an extra bouquet in the season, creating special content just for them, special discounts… you get the idea. Make your current customers your number one because they are here and they deserve your gratitude. Make them feel special.

Be willing to pivot and innovate

When the pandemic hit in 2020, we saw a flood of flower farmers pivoting their business plans, product offerings and services to reflect the current climate. We saw porch pickups for bouquet members, complimentary delivery and even selling seedlings to all the up and coming gardeners. I think we may see something similar brewing.

Change up your product to reflect the price-point or service that is in demand. Growing more budget friendly varieties such as sunflowers, zinnias or varieties/perennials you have in your stock already. This will give you the opportunity to be able to provide a more budget friendly experience to your customers that is relevant during a time with a downturned economy. With this said, this doesn’t mean selling a bouquet of flowers that would be $50 for $20. This means putting together a lovely bouquet for $20 with the value of $20.

Grow your skill

Historically, the floral designers who survived past recessions were skilled and innovative in their designs. Continue to educate, train and better yourself in the realm of floral design. Find your niche and become great at it.

There is still a place for flowers

As much as my gut is telling me to get lean with our flower farming operations and personal finances, it is also telling me that there is still a huge need for flowers. In fact, I believe even more so. I also believe it’s not the imported half dead roses that are needed but small scale flower growers. Community. Interaction. I believe the circumstances of the economy (globally) has leveled the playing field. Those “cheap” imported flowers are on borrowed time, especially when you look at at the limited resources in land, energy and chemical fertilizers currently happening.

As small scale growers we can easily switch varieties, grow more, grow less, a majority of us are becoming more reliant on natural processes rather than chemical fertilizers and other energy gulping resources. Seasonal and local will be the answer. A small roadside stand with affordable bouquets in conjunction with our more premium offerings will allow us to best capture new customers while keeping our current ones happy too.

The time for a small scale and sustainable approaches to growing specialty crops is here. Regenerative agriculture, relying less on fossil fuels, encouraging a healthy ecosystem, healing the soil to give the earth a chance to BREATHE! The amazing piece to this puzzle is it really is a leaner approach financially too. Less single use, less resources used, money saved, labor saved, more profitable.

think twice & bloom where you are planted

As the market slows, going into massive debt over infrastructure or having too much labor may not be wise. Labor is the biggest struggle for small businesses. Paying for people’s time gets expensive. If you do find yourself needing employees, be sure to choose their hours and tasks wisely. If you can invest in automation or weed cloth to help lessen the tasks at hand, that may be more profitable.

Rather than going into unnecessary debt, allow the business to earn its upgrades. If you cannot afford to pay cash comfortably for your investment (outside of property) perhaps it is a good time to practice patience.

Focus on nurturing customer relationships, your regular customers are more likely to make repeat purchases with you. Focus on growing your skill. Be willing to pivot your products/services to mirror the needs of your potential and current customers. Watch that extra spending.

Recession may or may not be on the horizon, but being debt-free and lean in your flower farming business will help make you recession proof. Flower farming or floristry alone is not recession proof, it is about your approach to make your business recession proof.

At the end of the day, keep doing what you love and stay positive. Our world needs the beauty of flowers as do you, the flower farmer.

So tell me, are you seeing a slowing in your market? How are you planning on handling that?