Some of you have seen this recent news article from the Chicago Tribune about some troubling news from FTD. According to the article, “FTD could go out of business or shrink its operations this summer if it doesn’t find a buyer or raise money by June 1.”
At first glance, that sounds like terrible news for the floral industry, but we spoke to our sources at FTD who clarified what was being reported and assured us they’re not going anywhere.
This is a time to think about where you feel most comfortable. Who is running your technology and what is most important to your business? Is it just about orders? Is it about running your business?
The truth is while this sounds more scary that I believe it is, FTD borrowed $400 Million and now owes $215 Million and is still making money. This is not a sign they would go anywhere. They can and should make more, but they are NOT losing money and that would be a concern.
Teleflora, on the other hand, is privately-owned and as far as I have seen, a very stable company. But if the family uses funds for whatever reason, to do anything, they do not owe any explanation.
I would like to see shops work together as teams. FTD and Teleflora both have their own strengths and shortcomings - so what you need for your business is most important.
If anyone is bashing FTD over this I doubt it would be Teleflora. Consider sources
According to FTD, the company filed its year-end 10-K (as required for any publicly traded company) but the article failed to characterize it properly. Any time a public company has loan or credit agreements, they are required to list any risks associated with the amendments of that agreement.
FTD is a billion-dollar company and will reach $40-50 million in EBITDA in 2019 so there’s no reason to panic or overthink this report - FTD is not going anywhere. In fact, they are currently working on a new cutting-edge website platform that they plan do roll-out early this summer.
With this new platform, FTD is focusing on the needs of the retail florist by upgrading and enhancing the back-end capabilities of their websites. We’re excited to see how well the new changes perform when they begin upgrading their current websites in waves starting on June 1.
The Industry Responds
As this news reaches more people, the industry is starting to react and take action. Floral Systems, who offer point of sale products has issued the following release urging FTD customers to consider other options.
The truth is, FTD borrowed $400 million and in 5 years has paid down the debt and still maintaining a profit. They have plans to create new back end systems and acquired a company most recently to help them improve the websites as clearly, we all know, we need more than a fancy landing page these days. They are making an effort. Having POS companies play up on this? Well, I just think everyone knows what is available and the relationship is the difference. Who hears you and treats you best?
This should not be a reason to jump ship in my opinion as I have heard comments that FTD will be gone in six months several times.
I would just say, if you do not care for one or the other wire service, let them know. They need you to survive, FTD is far more aggressive and with good reason. This is and has been the ride with them for years and years. Your business should rely on YOUR needs and communicate with whoever could do a better job for you. Wire services like Teleflora are the ONLY ones who do not ship flowers in a box and other than that, it's personal preference. I applaud them for that but understand FTD is up against 1-800 Flowers and if one does it, the other does too. That's my 2 cents. What's yours?
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