Flowers for dreams

A. The main facts about the activities of the company.

The business model of the company is very simple: They sell locally crafted flowers via internet avoiding any unnecessary cost by throwing away all the traditional expenses of a local florist (urban storefront rent, window dressing, retail staffing) and developing a just-in-time inventory system to reduce spoilage by over 30%. They are selling quality flowers with original and sophisticated design. The price is just as simple as de business model: 35$. No transactions fees, no delivery fees or any other type of fees, the client pays 35$ and is given the flowers, as simple as that.

B. The Ethical challenges this company is addressing.

Charity

The company is really concerned about the social impact that they are able to make. Nowadays, for each purchase of flowers they get, they are making a contribution to local charity organization with an impact on society, always at a local level. Every month, they choose a different non-profit organization with a different type of impact on society. Those are some examples of charity organizations they collaborated with and the projects they financed:

 Ronald McDonald House Charities: contributions went to funding temporary housing for families of children in need.
 Common Threads: contributions went to funding after-school programming on healthy eating and cooking for low-income youth.
 Supplies for Dreams: contributions went towards funding backpacks and school supplies for low-income students.

Environment

In addition, they are also an environmental responsible company, since they have been several certificates because of their environmental responsibility, for example when they offer eco-friendly flowers, in recyclable coffee burlap, wood and bark vases.

Costumers and Workers

They are fair, so ethical, with the costumers in several ways. That is proved with the following policies that they apply:

 Pay What You See – They don’t want to cheat clients with prices. Many times, in many purchases, the price jumps 100% with care charges, service fees, balloons, and delivery rates (except for an insignificant fee of $10, compared to others, for quite further places to deliver). With F4D, you pay what you see.

 Delivery Confirmation Email – A real-time message sent to the purchaser when the recipient has received their bouquet.

 Follow-Up Contact – Day after emails or calls to our purchasers are a regular occurrence. They want to make sure that the client had a flawless experience and get any honest feedback on how to improve.

They have also tried to develop a community concept among the people working with them, that’s why they always respect some principals:
ive some
 No UNPAID internships – They have employed over 31 students part-time since we began in 2012 and each of them has been paid well for their service.

 Collaboration, not Coercion – There is no hierarchy with a dictator at the helm. Every team member collaborates on every project, from the CEO, to the delivery drivers, and everyone in between.

 Education – they have provided more than 12 scholarships to their high-achieving student staff to encourage them to stay in school and help allay the costs associated.

C. What makes you believe this company is really ethical and why you trust it?

Flowers for dreams seems like a new way of understanding business, not only a flower shop that happens to give some of its revenues for charity.

To start with, the origin of the business was in the owner’s idea of offering bouquets at his high school graduation and financing with each of them school material for kids in Chicago. Thus, the concept of F4D involved sharing a part of the pie with society from the beginning.

Sending flowers is a very simple way to congratulate someone or to share feelings with important people and F4D offesr this sincere and humble way to do it by avoiding all th overdecoration, even though trying to sell teddy bears and chocolates to accompain the flowers is not a crime. Yet this has no direct ethical implication, their added value is their understanding of this gesture, and their care for needed people and for the environment when preparing them.

Additionally they have a strict wastage policy that prevents large quantities of flowers and plants to be thrown away. They keep what is necessary. In part this is the reason why they do not have dozens of bouquets to choose among and why the flowers they add in each model vary slightly depending on the season, etc. However, they still make beautiful bouquets and the recipients of them very happy.

For all these reasons F4D inspires us simplicity in what they do and a willingness to operate within and for the locals of Chicago area.

D.The possible challenges facing the company in the future and how you think this compay may improve.

The company may face challenges in the future:

 Trade-off quality / cost

It would be difficult to maintain the chemical-free and pesticides-free policy, control the water pollution and also maintain a competitive price al $35, $55 or $75. The cost of growing flowers without the use of chemicals and pesticides is actually higher, making this business less efficient than the industrial production. Therefore, the company may address in the future a big challenge to continue maintaining a competitive price at higher cost than the competitors.

In addition, the market of flowers has now different segments and bouquets can be found in US supermarkets by less than $20. The challenge for Flowers for Dreams here is to make its proposal of value worth the difference in value (through service differentiation, delivery…), and to place somewhere in the middle of the cheap retailers with a low quality product, and expensive firms ($70 and above), offering a complete service but at an unfair high price.

The costs saved on urban storefront rent, window dressing and retail staffing could end up lowering sales, as the customer may not know about the existence of Flowers for Dreams or should seek for the professional advice when considering purchase. In other words, the cost-saving policy could be lowering quality of the service.

The company should enhance consumer awareness and not neglect the service provided to its customers for cost reduction.

 Maintaining the demand

There may not be all kind of flowers all seasons, and flowers may not look as big or colorful as the ones grown in greenhouses. Because of the occasion of consumption –special events, weddings, etc.-, we could catalog the product sold by Flowers for Dreams as a luxury product. We think that the demand in the market of flowers is higher than the supply and it is not so price sensitive: the customer is more worried about the beauty of the bouquets than the final price paid. For this reason, we can see a threat in a demand shift to other retailers with a wider or more spectacular offer.

In order to maintain the demand, we think that the company must make a big effort on the purchasing experience and the service, in order to differentiate from competitors and set itself as a value added proposal, also by signaling its ethical purposes to gain public that is really interested on environmental concerns.

 Increasing costs of education

One of the main objectives of Flowers for Dreams is to help students paying their studies by providing scholarships and well paid internships. The raising costs of education together with the small margins left for the company may turn this objective in a not easy task and it is a challenge that the company might address.

 Controlling suppliers

The artisan production of flowers may not be a profitable business as many bouquets producers and retailers look for cheaper suppliers to maximize margins. The company has to make an effort to find those firms which still grow flowers without the use of chemicals, pesticides and other toxins, and they should find a way to signal their no-pollution production to make sure they are doing so.

 Building trust

On Flowers for Dreams web we can see a lot of ambitious goals but not so much evidence –in figures- or tracking of the achievements.

A good way to improve credibility would be to build measures and reports to observe and communicate the water pollution, soil erosion, water consumption, wildlife protection, and farm/land preservation, which the company is aiming to minimize, not only to monitor suppliers’ practices but also to build trust and make a credible commitment through transparent and accessible information.