Ask The Expert featuring Adrian Ulsh
Q. Hi Adrian, I have a client that has just opened a floral shop. Since she is just getting started, she desperately needs new customers. Any suggestions how to get people coming into her shop ASAP?
Effective advertising is of course the long-term approach to building a successful business, but advertising and marketing today work much slower than in the past due to market saturation. If I were a new florist, I would look into setting up a series of joint venture partners.
Joint venture’s involve two or more businesses that decide to form a partnership to share markets or endorse a specific product or service to their customer base… usually under a revenue share arrangement. The key to creating successful joint ventures is to find partners who service the exact same type of clients that need or want what you sell.
Here’s how this might work for a florist.
One of the most financially lucrative product lines for a florist is providing flowers for weddings. The average floral bill for a wedding often exceeds $3,000. But what I’ve discovered about florists is they fall into what I refer to as an “event chain.” An event chain simply refers to a series of businesses that customers purchase from in a specific sequence.
For example, a wedding will never take place until a ring (it can be a diamond or even a pinky ring) is purchased from a jeweler. So, jewelers are at the forefront of every wedding chain. Once the young lady accepts that ring, this event chain kicks into high gear.
First, this young lady knows EXACTLY where she wants to get married, so number one on her agenda is to book the church, chapel or synagogue where she wants the ceremony held.
Second on her list is to line up her wedding planner. Weddings today are a really big deal, and often women like to use the services of a professional wedding planner.
Next up, she wants to secure the venue for her reception. She knows most venues book out months in advance, so locking in that venue is high on her priority list. After that comes the wedding dress, so she begins the search for the perfect dress at an affordable price.
Next is our florist. The bride-to-be will want to begin selecting her floral arrangements for both the wedding and the reception. Then after the florist comes the wedding cake… the printer for the invitations and thank you cards… and depending on the financial ability of the bride to be, she may also be interested in hiring a limo… a DJ for the reception… a travel planner for the honeymoon… the hotel… catering and so on.
This event chain is typical of this industry. And for the florist, it specifically identifies a multitude of potential and very lucrative JV partners. But here’s why this becomes so important.
Every business ABOVE the florist has the potential to ENDORSE and SEND prospects to the florist.
Unfortunately, the florist has NO control over that flow of prospects. Every business above the florist controls the JV relationship, so it’s critical the florist create such a compelling offer and relationship with these businesses that they feel obligated to send prospects their way.
But here’s what’s even better. The florist controls the prospect flow to ALL the businesses BELOW them in the chain, and by establishing specific processes and procedures to make sure their customers use those businesses, the florist can negotiate compelling offers with those business owners as well. So, consider these numbers.
Let’s say your florist cultivates a JV relationship with at least one of each business throughout this entire chain. Staying ultra-conservative with our estimates, would you agree your florist… since she has NO control over the flow of prospects from these businesses… is it likely she could obtain at least ONE referral each month from just one of the businesses above them?
OK, would you also agree conservatively that since your florist controls the flow of prospects to the businesses BELOW her… that she could easily send at least ONE referral to EACH one of them every month? Keep in mind these are VERY conservative estimates I’m using here.
Since the average floral bill for a wedding is $3,000… then just ONE referral per month from those businesses ABOVE your florist increases her annual revenue by $36,000. Now let’s consider the businesses
BELOW your florist where she controls the referrals. Let’s start with the wedding cake maker. The average sales price for a wedding cake is also $3,000, and your florist could easily negotiate a 10% referral fee. So just a single referral per month produces an additional annual increase of $3,600 for her. Now consider the printer.
The average sales price for printing is $1,000, and she again could receive a 10% referral fee, so that single referral per month produces an additional annual increase of $1,200.
If I stop there, your florist has just increased her annual revenue by more than $40,000… and that’s using ridiculously conservative numbers. Imagine if you continued to add up the revenue produced by all the additional referral fees the florist would earn from all the other vendors in this chain.
This same process holds true for businesses that aren’t in a chain.
But just like the florist, they simply identify partners who service the exact same type of clients that need or want what they sell. Now I realize this looks easy, but it’s not… and here’s why.
You not only have to properly identify who would make an excellent joint venture partner for your business… but you also must determine the order to approach each one… how to approach them… and when to approach them. It’s critical you do this properly or you wind up burning through all of your potential JV partners and come out with nothing in return.
Let me ask you a quick question. Just off the top of your head, how many potential joint venture partners would you estimate might be a fit for what you sell? Conservatively, let’s say you only get 3 referrals every month that buy from you. That’s less than one per week. How much additional revenue would that add monthly?
And never forget the critical importance of creating a highly compelling informational offer that would promise so much value to prospects that they would knock your door down to get it. Suppose your florist offered this informational offer in her marketing… “5 Things Every Bride Should Know To Avoid Disaster On Their Wedding Day.” This offer would place TONS of prospects into her drip campaign and result in a tremendous increase in sales.
Those new sales can then be referred to her new joint venture partners and she will collect multiple referral fees every month. This would absolutely dwarf the revenue we just uncovered for her here.
What I find really exciting about joint venture’s is this is a strategy I help my clients implement immediately… and it begins generating instant cash flow for them right out of the gate.
Hope that helps Elena.
About Adrian Ulsh
Adrian Ulsh is the CEO for Leader Publishing Worldwide, the largest online provider of coaching services worldwide. Adrian currently works with more than 500 coaches in 24 countries advising them on building 6 and 7 figure coaching practices.