Business Is Blooming at the Flower Auction
Although it was barely past dawn Thursday, the trading was already brisk in the auction room. Above the auctioneer, a computerized tote board gave the latest prices, while anxious bidders contemplated their next move.
“It’s a reverse psychology,” said one experienced buyer. “There’s a little bit of greed worked in. People will pay more just because they want to be sure they’re the ones who get it. New buyers tend to be really impulsive. They’re not familiar with the psychology of the thing.”
The commodity is flowers.
Although the California Floricultural Assn. holds auctions every weekday at its south Carlsbad warehouse, Thursday was one of the year’s top trading days. Florists from all over Southern California bid on more than $25,000 worth of roses, carnations and chrysanthemums to stock up for an occasion that many believe surpasses Valentine’s Day in flower sales.
Thursday “is the peak day,” said florist Jacob Maarse, who came from Pasadena to buy roses. “We need Friday and Saturday to make the arrangements and deliver them. The prices today are 20% higher than they were yesterday. You have a price in mind that you want to pay, but if you see roses go at a higher price, then you may have to pay it.”
Carlsbad’s flower auctions are a bit of an anomaly, both for the flower business and for auctions. Usually, growers sell their flowers to wholesalers, who provide florists with whatever quantity they want for a set price. But here, flowers come directly from the fields to the auction blocks, where wholesalers, florists and street vendors bid competitively for lots containing 100 or 200 flowers.
And, unlike most auctions, the prices start high and go down . The auctioneer sets a starting price on the tote board. It steadily decreases until a bidder pushes a button to freeze the amount. Florists who are desperate for scarce carnations will bid immediately, ensuring that they will get the flowers, but at a higher price. Frugal bidders may try to wait until the price gets low enough for their tastes, though they risk going away empty-handed.
“The price is a free-market value determined completely by supply and demand,” auction manager Eric Larson said. “Flowers are such a volatile market. Most of the florists have already set their retail prices and now they’re trying to buy the flowers at the lowest price possible.”
The California Floricultural Assn., a nonprofit corporation owned by an amalgam of flower growers, began holding auctions in November, 1982, to provide an alternative to dealing through wholesalers. Most of the flowers auctioned at Carlsbad are grown in North County fields, though some are shipped in from Northern California, Oregon, Washington and Hawaii. To protect domestic growers, foreign flowers cannot be sold at the auction.
“We charge the growers 14% for the flowers sold here,” Larson said. “But since we’re nonprofit, we refund to the growers whatever we don’t need to cover expenses. Last year we refunded 2%.”
As a result, a bucket of 200 carnations can go for $60; a bit more will buy a “lot” of 100 roses. Crysanthemums, hailed by florists as the best bargain of this year’s Mother’s Day auction, were available at $5.50 for a bunch of 20, with a minimum purchase of 10 bunches.
“I believe that I save 30% to 35% off a regular wholesaler,” said Lloyd Burkett from Joe’s Flowers in Point Loma. “I find it’s well worth my time to come up here.”
The auctions have proven so popular that they are credited with spawning a boom in the retail industry.
“The auction and the newspaper coverage of it have stimulated a lot of new retailers--small florists and street-corner stands,” said Riz Oades, who buys for a Hillcrest florist. “They provide competition, but they usually don’t last, since the business requires a lot of experience and good management skills.”
One such neophyte in the business is Charlotte Terpeney, who opened A Bright Idea flower shop in Escondido less than two months ago. To help her compete against veteran flower-buyers at the auction, Terpeney brought along Geraldine Kaeding from Van Nuys, a florist for five years, as a buying partner and consultant.
“I’ve seen the prices in the L.A. area so I know what the top-level price is,” Kaeding said. “Once you set a price limit, you can go a little beyond it, but that’s it.”
Terpeney has still found the flower business thorny at times.
“It’s so expensive; I came here Monday with $200 and spent $300,” she said. “Once you buy the flowers and the pots and everything else you need, you can’t even add your labor to the cost of the arrangement.”
Kaeding also advised Terpeney on which flowers are the favorites for Mother’s Day.
“You want to get the roses, because they’re traditional and they go real quick,” she said. “And of course, mixed bouquets are always big sellers, because men usually tend to want to buy a bouquet for a gift than to go out shopping for two or three hours looking for something else.”
