NEW DELHI, March 22: When all you need to start a business is just a bucket of flowers, smile comes with the turnover for free -- and smiles are here to stay.Florists are one of those who get back their investment at the end of each day and that too at unbelievably high margins. Sample this: If one buys flowers worth Rs 100 in the morning and sells them at a margin of 10 per cent (it is actually much higher than this), by evening he makes Rs 110. The same can be invested back the next day. "This way my money gets rotated 30 times in a month and by a conservative estimate I earn 300 per cent margin per month," explains Vivek Dhingra of Vivek Flowers Pvt. Ltd.
Profits in selling flowers are often more than 100 per cent and may in fact go up to 200 to 300 per cent. A Puri of Flower Delivery Fresh and Dry Worldwide, however, puts the margin at a modest 50 per cent though he too feels that the business is lucrative.
Contrary to the popular perception, roses are not the most popular of flowers. Dhingrabelieves carnations sell the most though marginwise, both gladiolus and carnations are profitable.
The export market offers a good potential for florists. The United States is the primary destination for flowers followed by Germany, Netherlands and the UK. Dry flowers form a major portion of the total floriculture exports (see box).
The scale of growth in this business is also evident from the fact that florists quickly mature from the roadside "bucket" stage to the upmarket "home delivery" stage in a very short span of time.
The customers can specify their own style for delivery of flowers or leave it to the florists who have well worked out plans for wooing hearts. They not only educate the customers on relevance of flowers and which flower is given on what occasion but also suggest the ways for presentation. For instance, while a general tulip may mean a perfect lover, a red tulip stands for declaration of love while the variegated ones are for beautiful eyes.
Vivek Flowers books orders through theinternet too but Dhingra claims that the concept is not very popular even in Delhi. "It will still take some time to gain ground," he feels.
Puri, who recently set up a new shop in Lado Sarai area of South Delhi, offers services like tele flower, wedding flower decor, monthly flower display, flower gift service and inter-city delivery.
"Till a few years back, flower business was confined to Old Delhi. We had to look for business. Now, there is enough for everyone and in Old Delhi alone there are about 700 to 800 families which are associated with the trade," says Dhingra who started his business in 1975 out of sheer desperation to earn a livelihood. A honours graduate in Physics, he found that there was nothing for him in the job market. He could not even manage a job of Rs 250. So with no financial backing from anyone, the school teacher's son thought of selling flowers.
Manvinder Singh of Rajendra Florist also has a similar story to tell about his father who began his business with a bucket of flowersabout 32 years ago from outside his house. "You do not need much to start a florist shop," he affirms.
Puri, however, feels that one should start with a minimum investment of Rs 50,000 for a quality business since competition is rising by the day. He himself began with an initial investment of Rs 25,000 in 1990 and now has a turnover of Rs 1.3 crore of which exports alone constitute Rs 1 crore.
Dhingra favours a small start and feels the business should be allowed to grow on its own fruits. "One earns enough to go in for expansion in different phases."
According to Dhingra, Delhi has a combined daily turnover of over Rs 1 crore. In fact, florists have seen a spurt in their business in recent times. But prices in Delhi itself vary according to localities with difference sometimes being as high as 100 per cent. New Delhi and South Delhi areas fetch high prices.
Delhi is the leading market for flowers. Besides a whopping number of individual buyers, presence of a large number of hotels and corporatehouses jacks up demand. Moreover, the value of money in a city like Delhi is going down. In a budget of Rs 200-250, one cannot buy a decent gift and most people do not like giving cash. So, the best option is to give flowers.
According to Dhingra, there is a difference in the attitude of youngsters and elders when they come to buy flowers. A clever florist always exploits this. "When youngsters gift flowers, they have an intense feeling behind it and so price is no bar for them though in case of students the purchasing power may not be very great. Elders, on the other hand, buy flowers as a mere formality and so they are very price conscious."
Most florists undertake decoration works for weddings, other family functions and corporate events. Dhingra claims that his shop decorates flowers free of charge. Hotels and restaurants, which are among the major clients, just buy flowers and have their own staff for decoration.
The kind of flowers ordered by hotels are also very different. Says Dhingra: "Theywant full bloom flowers every day which look fresh. Forty per cent of my flowers land up in hotels." Supplying to hotels helps him to make money out of the left over flowers since buds are in full bloom after one day. "This way I have no wastage."
Perishability of flowers is a major problem for florists. With lack of proper storage and transport facility, Indian florists are way behind other countries though both Dhingra and Singh say that as far as availability of flowers is concerned they do not face much problem. "We get flowers all round the year. In summers, Himachal Pradesh is a good source while rest of the year, we get it from other parts of the country," says Dhingra.
Bangalore and its surrounding areas also have a thriving floriculture business. Dhingra feels that growing flowers in Delhi is not viable for florists since the land cost here is very high. Singh, on the other hand, feels that this is not true at least for gladiolus which he grows near Delhi. Ten per cent of Singh's turnover comesfrom export of gladiolus while 90 per cent is from domestic sales.
Being an agriculture operation, growing flower is non-taxable. But florists do not enjoy the same benefit. "I grow my flowers but when I sell them I am charged sales tax. This is not fair," observes Singh.
Dhingra also points out that due to this anomaly many florists try to show that they are growing flowers and not selling them. He feels that a proper licensing policy should be laid down for florists since it is a growing business.
Nonetheless, with little money, if one wants to make a statement in successful enterprise, just do it with flowers.
Of dry flowers and evergreen smiles
Dry flowers and plant material command 60 per cent of total floriculture product export. The Indian dried flower export market is classified into three main product segments and one specialised lower volume segment -- dried flowers and plant parts in bulk, potpourri (a mixture of dehydrated flowers, berries and leaves), arrangements (with driedplant materials and dried flowers) and floral handicrafts.
In the domestic market too, dried flower arrangements are getting popular in five-star hotels and restaurants. According to the Agriculture and Processed Food Products Export Development Authority (APEDA), considering the popularity of silk and synthetic flowers in the Indian market, dried flowers hold tremendous potential in the local market though the country has yet to develop a taste for them.
The dried flower industry is highly concentrated, with the majority of sales in terms of volume and value accounted for by fewer than five companies, three of which are affiliated with each other. The major markets for dried flowers lie in the United States, Europe, South Africa, Australia and Sri Lanka. Dried flower are sourced from their natural habitat. The majority share comes from Madhya Pradesh, Bihar, the North East and Himachal Pradesh. Only 20 per cent of the dried flower raw material is cultivated, rest comes from the wild. Tuticorin andCalcutta are best suited for the dried flower industry though in terms of sales, cities like Delhi are best. The estimated value of the Delhi dried flower market is about Rs 4 crore.
According to A Puri of Flower Delivery Fresh and Dry Worldwide, wheat, rye and oat dry flowers are most profitable. It seems business for florists will remain fresh even when the flowers turn dry.
Copyright © 1998 Indian Express Newspapers (Bombay) Ltd.
