Relevant and even prescient commentary on news, politics and the economy.

I Got your REAL State of the Union right here

by Daniel J Becker (DOLB for the rest of you)

UPDATED BELOW.
Well, I thought being tonight is the big night for the President I would give my version of the SOU. This is an update on the flower shop. For any new readers, these are real numbers from an honest to goodness small business.

As you can see from the chart below, or maybe not, I don’t need a loan. I don’t need a tax break. I could use a real national health plan as the medical for this year again, including premiums hit $15K (16.5 and 17.7 prior 2 years). I have a high deductible plan that increased from $6471 in ’06 to $7195 in 2009, 11% up.

No, even if you did the cash for clunkers again, I don’t have the extra cash flow to take a loan. Though the delivery van has 235K miles on it. It’s a 2002 Caravan.

All my loans are fixed, so I’m not worried about deficit fueled inflation as it relates to my monthly payments. My property, even with the 15% loss in the last 2 years based on tax evals is still 1.69 times more than my mortgages and I only have 15 or less years to go.

We’re working with less people at the shop and have layed off our manager/worker (he’s fast, a good designer and can carry the load when we’re not there) to 1/2 time. We’re watching every penny as to inventory, utilities, insurances (I’m getting money back on the WC because payroll is down).

What I’m worried about is this:
Keep in mind, that we were considered a larger than normal shop. If we’re doing this bad, imagine how the wholesalers and everyone else down line are doing. That’s the real trickle down folks!

There is only one thing that will fix it: CUSTOMERS!

It’s not that people are not trying to spend, it’s that they really have run out of money. Note that the credit card sales continued to rise for a year after the account and cash sales started to decline.
The people tried to spend. Now they can’t.

So, let me be clear to the Congress and the President: I NEED CUSTOMERS…WITH MONEY!

Update:  A commentor asked for some more data. 
Ins, Maintenance, Rent, Utilities, and Property/inventory taxes are 13% of gross. Payroll is 25% Payroll is down 14%, but gross is down 16%. We can cut payroll more, but the issue becomes my sweety having some down time. (please no lectures). Payroll was 25% of gross last year. 

Supplies (what we sell) were 48% of last years gross, this year 47%.

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Update: Real world business

by divorced one like Bush

Time for an update on real world business. I posted back in 12/08 about the costs of a flower shop being in a wire service. The costs should matter, as it is what happens when one buys on line from a non-real florist. It is also a lesson as to what a real small business is dealing with. Sales are off 25% for the year on top of 8% for last year.

This morning my sweetie stated that “they” are screwing up health care for us. Her concern was that we would now have to be offering insurance for our employees. I informed her that the cut off was 25 employees. We are safe regarding this issue. Unfortunately, nothing proposed will help with our health care costs (currently $7800for insurance and $4028 out of pocket with an additional $3500 still owed to the hospital and the need for cataract surgery and about $1500 in dental for the daughter).

So, here is what has happened regarding the wire service aspect of our business.
June’s Teleflora statement.
Total value of in and out orders: $974.78

Processing costs (membership, Dove, Quality program, Sending fee): $301.15
Advertising (directory, Co-op): $206.00
Publications: $3.75
Commissions due (orders in 27%, orders out 80%): $455.46
Total paid to Teleflora: $966.36

Balance of order value – costs: $8.42

Total value of orders to be filled: $614.78 That is, I had $8.42 to work with to fill orders that valued $614.78. In a nutshell, this is how it is that bigger business have via financialization, sucked money up hill from the smaller business.

Percent of order value out to orders in 59% June 09. (Year to date: 50%, Last year to date: 60%)
Compared last year to date incoming value down 14%, outgoing value down 42%.

I can’t convince the sweetie to drop at least one of the wire services as she sees it as work and thus a cash flow perspective verses an accrual. Overall regarding our net profit as of the end of the first half of the year, (you know, money in the pocket) on a cash flow basis, we are off 43.9% on an accrual basis we are off 88.1. Far cry from Goldman Sachs No?

And, we are now in the slow period of the flower business cycle.

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Some color for the Angry Bears

It has been great weather here in Riland, today included. In the spirit of celebrating growth renewing (as we count down the days to the election) I thought I would put up some pictures of the shop and add some color to the blog. Some of the none language kind of color that is.


No, I do not do any of the designing. I have never had the eye for such work.

These are all silk arrangements of our own design. Good silks are so real you have to touch them to tell the difference.

The indoor plant room. Usually this looks like a jungle, but the season dictates outdoor plants. We have herbs also.

The greenhouse. We will be moving these to the second house to provide more room for them to grow out.

And the plug…

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