The spin according to RC, or file this under "R" for rumor
The spin according to RC, or file this under "R" for rumor.
Since reality and truth are always so hidden away in the many layers of spin, we will never know the full story of what has happened to Veldkamp's.
But since this is playing out so close to what I expected, I feel compelled to share my version of the truth. Keep in mind I don't know Ben or any of the Veldkamps and my limited knowledge of them comes from what I've read and heard (no facts, just my insight), and one of my ex-employees who worked for Veldkamp's for a good number of years as a buying manager.
Here goes.
Veldkamp's was aggressive and showed great growth during the 70s and 80s when the flower industry was going strong. Growth was easily achieved by opening up stores and profits automatically followed, but as we moved through the 90s business started to change. Growth wasn't automatic, new types of competition started popping up, and margins started shrinking. Veldkamp's growth had stalled and in fact business was starting to erode.
The erosion of business crept unnoticed for a few years because Veldkamp's solicited incoming wire orders to fill their growing excess capacity. As their local business declined, sales were propped up by ever increasing numbers of incoming wire orders. Incoming wire orders were beginning to no longer be a peripheral part of their business, but were now looked at as an integral part, a profit center as well. FTD, Teleflora, and especially 1-800 had become their blood line for growth. Soon Veldkamp's was the primary filler for 1-800flowers. The much sought after growth finally was back. Any loss of local business was easily replaced by the explosion of incoming 1-800 orders.
The monetary costs of receiving these orders inched higher, but the immeasurable costs went completely ignored. These costs included the slow loss of local identity, the slow loss of customer loyalty and finally the loss of control over one's own business. At the same time Veldkamp's local business was eroding tremendously, incoming 1-800flower orders were now well into the millions of dollars annually and continuing to increase. It would be no surprise that a co-branding effort might be forced upon them with the threat of pulling away a couple hundred orders a day that Veldkamp's had become so accustom to filling. What was Veldkamp's to do? They either had to drastically downsize their business fast or come to the realization they have lost control of their own business to their new partner.
Veldkamp's decided to partner, maybe because of ego or maybe because they liked the growth 1-800 provided that they were unable to achieve on their own, but unfortunately when they gave up controlf their business they also lost control of their own destiny. As the world changes so does business models, and as much as 1-800 liked the idea of having brick and mortar shops with vans driving around town with their name on it, they liked the idea of expanding their wire business even more. The only known way to sign up shops to a wire service is to promise them orders. This presented a problem in Denver, not for 1-800flowers but for Veldkamp's as not only had they become forced into partnership, they were not even going to be exclusive. As 1-800 signed up florists promising volume, the volume of orders to Veldkamp's declined, losses mounted and today, stores are being forced to close.
Of course their spin is they are simply reevaluating and reorganizing, but they fail to tell you the whole story as to why.
But this is just my spin not based on fact, just my insight. You see, I had already written this script in my head long before it all unfolded. Whether my spin is at all accurate or not, I tell you this for the lessons to be learned.
The spin according to RC, or file this under "R" for rumor.
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