HORTICULTURE 



Vol. XXIX 



MAY 24, 1919 



No. 21 



FLORISTS AND THEIR ACCOUNTS 



1 1 n as not an unmixed blessing when the government 

 compelled florists to make an accurate survey of their 

 business in order to satisfy the income tax collector. 

 This was the opinion of Mr. F. 11. Palmer, a well known 

 and successful florist and nurseryman, speaking at a 

 meeting of the Boston Gardeners' and Florists' Club, 

 Tuesday evening. Mr. Palmer then went on to discuss 

 accounting methods adapted toi the florists' business, 

 using his own system as an illustration. He declared 

 that there had always been too much secrecy and mys- 

 tery about the business affairs of florists in general. 

 Under the new conditions this was being broken down, 

 which was a distinct gain. Mr. Palmer asserted that in 

 the past the average florist had kept books in the most 

 haphazard sort of way. If he had money in the bank 

 at the end of the year, he figured that he had made a 

 profit without considering what it was going to cost him 

 to meet bills soon to be due and to restock. 



'"The constantly rising overhead costs," said Mr. 

 Palmer, "have made the florists realize the need of re- 

 vising their methods. If they lack adequate book keep- 

 ing methods, they do not know how to readjust their 

 work. Many a florist hesitates to raise his prices, no 

 matter how much costs have advanced, perhaps because 

 he does not analyze his affairs. A good accounting 

 shows the tendency of the business and makes it possi- 

 ble for the owner to classify all the various items to 

 Berve as a basis for his future policy. This necessi- 

 tates the persistent and careful writing down of each 

 day's work. The machinery of book keeping is another 

 story. That simply means having a good book keeper. 

 However, I believe in calling in an expert accountant at 

 periodical intervals to go over the business. This ;s a 

 tremendous help. Accounting is a science in itself. 

 You can never learn it all by experience. The services 

 el' a good accountant are worth all they cost. 



"Our business is more complicated because we have 

 three departments. They are divided as follows: 

 Greenhouse and nursery, store, and outdoor work. Sep- 

 « — arate accounts are kept for each department, and noth- 

 £2 ing is transferred from one to the other without credit- 

 .__. ins; and debiting, as with two distinct lines of business. 

 -^ Right here I want to say that it is most important to 

 ^_ take a complete inventory when forming a partnership 

 <t if there is stock on hand. Every item should be en- 

 3E tered. aud there should be papers to cover all agree- 

 ments. An inventory, for that matter, should be made 



at least twice a year regularly. This means a physical 

 and actual examination of the stock. Florists have al- 

 ways disliked to do this, but there is no other way in 

 which they can know where they stand. 



"We have a purchase book divided into columns to 

 cover all the common items, such as telephone and tele- 

 graph charges, automobile expenses, materials, adver- 

 tising, etc. By this means we can analyze our purchas- 

 ing accounts at any time. It is easy to carry this sys- 

 tem to such a point that you can compare the cost of 

 running one make of car with another and the wearing 

 qualities of different tires. When the bills come in the 

 office manager indicates by a brief notation with a red 

 pencil which column it is to be entered under. The in- 

 voices are filed daily and not allowed to accumulate. 



"We also have a sales book which is kept in much the 

 same way. We use sale slips, of course, and at the end 

 of each day these slips are clipped together with a piece 

 of paper attached on which the totals have been recorded 

 with an adding machine. The slips are then filed away 

 but may be found almost instantly under any given 

 date if it is desired to check up a past transaction. If 

 a customer makes complaint, for example, the sale slip 

 will show the date of the sale and the slips can then be 

 brought out to furnish the additional information 

 needed. On the sale slip department making the sale 

 gets the credit. The orders which appear on the sale 

 slips are entered in a shipping book bound like that 

 used by express companies. This book is carried by the 

 driver and a signature is required from every customer 

 who receives a package. By this system we can instant- 

 ly trace any sale from source to delivery, which pre- 

 vents many a dispute and protects all parties involved. 



"Finally we have a cash register from which nothing 

 is paid out. The money received one day is deposited in 

 the bank the next day. The daily deposits always tally 

 with the previous day's receipts, one just checking the 

 other. By this plan we know where we stand to a cent. 

 A petty cash account is also carried in the office, and al- 

 ways contains ten dollars or its equivalent in slips. NTo 

 amount larger than five dollars is ever paid out except 

 by cheek. We send check for all our purchases by the 

 tenth of each month, and have no trouble in getting 

 credit. When our buyer goes to the market he doesn't 

 have a dollar of the firm's money in bis pockei excepl 

 for breakfast. 



"Finally a summary is made showing the gross 

 per year from which are deducted all expenses, like 

 salaries, rent, deliveries and repairs, with overhead 

 items, even to postage. I have learned from the income 

 bas officials that eighl per cent is considered about the 

 right margin of profit for florists, being told that thai is 

 the average in successful establishments." 



