September 3rd, 2021
I hope you share our amazement at the extraordinary sales and growth in the U.S. horticulture industry in the last year. Given the deep uncertainties we all faced in early 2020, Casa Flora is both grateful for this spectacular rebound and very excited for the future. Along with this unprecedented growth, however, like the rest of the industry we’ve also had to bear unprecedented labor shortages, hourly labor cost increases, and an increase in the cost of materials.
When we drafted our 2021 and 2022 price lists, we could not have imagined how quickly our costs would increase. Between January 2021 and now, our labor and input costs have jumped multiple times because of supply bottlenecks and macroeconomic factors beyond anyone’s control. Labor costs are up by over 60%, and we face 10-40% increases in the cost of materials. We’ve already made many shifts in our business model to mitigate the things under our control and cut costs where we can. We’ve streamlined the varieties we produce and improved efficiencies in our production processes. However, given the increased cost pressures that are completely outside our control, if we don’t also increase our selling price it will become increasingly hard to manage the supply strain to produce the number and quality of products required to keep our customers operational and able to flourish.
This puts us in an awkward position, and we humbly ask for your understanding and support for our decision to increase our 2021/2022 prices by 7% for all unshipped orders. It’s with great reluctance that we reached this decision, but it’s necessary to manage our supply strains and to keep producing the plants we’ve promised to deliver to you, our customers. This 7 percent will be implemented immediately on all unshipped orders.
On a more hopeful note, not only do we see absolutely no sign that market demand is weakening – on the contrary, we see only strong evidence that robust sales will continue throughout the horticulture industry through 2021. The horizon looks sunny indeed!
We are grateful for your understanding on these price increases, and we know that this is an exceptionally busy and challenging time for everyone. If, because of our new pricing, you need to make adjustments to your future orders, we ask that you do so as soon as possible so that we can adjust the production schedule on our end. We are here to help.
We love producing the plants that you, our customers, depend on for your business, and we humbly ask for your continued understanding and patronage as we ride this wave together.