Sunday, June 16, 2024

Flower retailing business struggling

New research from IBISWorld has shown a decline in the flower retailing industry amid competition from supermarkets and online retailers.

IBISWorld expects industry revenue to decline by an annualised 0.7 per cent over the five years through 2015-16, with revenue expected to total $716.6 million over the current year. Despite this, by focusing on detailed floral arrangements, which attract higher premiums, the industry has been able to protect profit margins.

“Only half of all cut flowers sold in Australia are sold by the flower retailing industry,” IBISWorld Senior Industry Analyst Lauren Magner said. “The remainder are retailed through other bricks-and-mortar companies, such as supermarkets and, increasingly, via online-only operators.”

IBISWorld anticipates industry revenue will fall by an annualised 0.6 per cent over the next five years, to total $694.7 million in 2020-21.

Ms Magner believes that special occasions represent an opening for flower retailers to compete with online retailers.

“Mother’s Day has traditionally been one of the most important celebrations for flower retailing in Australia,” she said. “Special celebrations such as this are gaining importance as the industry battles competition from online-only operators, supermarkets, greengrocers and convenience stores.”

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