Business Blooms for Petals Network

From a standing start in 1992, Petals Network has become a large and significant flower relay service competing against long-established international rivals. Nicola Card talked to Petal’s owner, Scott Williams, about the challenge of taking on the big boys, and how you build an international business from a regional country town.

At face value, the charming New England town of Armidale in northern NSW would appear to be an unlikely location to be the headquarters for a highly successful global network of florists. But Petals Network co-founder and CEO, Scott Williams, has never let distance stand in the way of business development. Nor has he ever allowed himself to be intimidated by big market players.

In the early 1990s, he and his then business partner, Bobbi Ballas, decided to take their small Armidale florist shop onto the world stage by developing an international floral delivery market. “We were keen to expand the business but our growth potential was stunted. We did however recognise that flowers are one of the few gifts that can be delivered within two hours just about anywhere in the world,” said Scott.

“We decided to develop a real-time, online order clearinghouse for flowers, available worldwide for the sending, receiving and tracking of floral gift orders,” Scott says. Of course this meant taking on the well-established giants Interflora and Teleflora.

They combined their respective skills: US-born Bobbi was a professional florist with strong marketing skills and Scott has numerous qualifications in data base systems and direct marketing.

Germinating the business meant building up a network of florists in Australia and overseas. They started by sending flyers to each of Australia’s 2500 florists, an operation they ran out of their ‘office’ which was Scott’s garage. Capital costs were minimal. Their seed funding was just $50,000 which they didn’t need to borrow. (And to this day Petals Network remains debt free.)

A David vs Goliath story

Surprisingly, rather than big players being a thorn in their side, they indirectly helped Petals Network on the path to success because the existing players had developed weaknesses which could be exploited. “Talking to lots of florists enabled us to identify most of the weaknesses of the two big players, and we set about developing a business model that was strong in each of those areas,” Scott said.

“That meant eliminating many of the frustrations - making sure it was a pleasant experience for florists when doing business with us, with prompt, accurate and efficient service. We put in a fair bit of effort to differentiate our business in order to carve a market niche in the international floral delivery service.”

Reflecting on this, Scott says, “It appears by their very nature monopolies are defensive, and operate in a walled city. If I were to give anyone advice about taking on a monopoly, it would be to avoid taking them on directly… instead, identify their weaknesses and nibble away on them.”

Scott described the challenge colourfully: “Ants tap-dancing around elephant’s feet can collect lots of crumbs, enough to survive and grow. Just a small proportion of the big business is enough to sustain small businesses and let them grow. This certainly applies to us.”

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