BloomThat is a San Francisco-based company startup that has revolutionized the floral industry. With a combination of innovative supply sourcing and tech-savvy transportation methods, BloomThat offers on-demand flowers and plants in a number of metropolitan areas and next-day delivery nationwide.
“We want customers to fall in love not just with our product, but also with the experience of doing business with our company,” said Matthew Schwab, co-founder and president of BloomThat. “Warby Parker makes people want to buy glasses even if they don’t need them, and people will drive miles out of the way just to stop at an In-N-Out. We see these companies as examples providing exceptional product in a way that delights customers and keeps them coming back time and time again. We strive to give our own customers (and their recipients!) that same blend when they order from BloomThat.”
BloomThat was founded with a mission to make it easier to be more thoughtful by offering beautifully curated bouquets of flowers, delivered ridiculously fast. BloomThat’s initial web and mobile apps let users select, pay for and have their flowers delivered within 90 minutes.
Their Y-Combinator stamp of approval and $7.6 million in venture funding left BloomThat in an enviable position. The only problem? BloomThat’s 90-minute delivery network was a very expensive endeavor.
To deliver on its promise of on-demand bouquets, BloomThat created its own delivery infrastructure to support its core floral product and experience – and that system was extremely costly to maintain. At the time of their New York launch in the summer of 2016, the company was burning through more than $500,000 a month.
“We probably had around four to five months of runway left,” said David Bladow, BloomThat’s co-founder and chief executive officer. “We needed to streamline processes and ensure that we were able to best offer our customers both stunning product and an exceptional gifting experience – so we looked to the best in partners to solve the infrastructure side of delivery.”
To save on costs, BloomThat decided to shift its focus and doubled down on what they did best: curating beautiful bouquets.
For their on-demand delivery needs, BloomThat partnered with Deliv to outsource their local transportation logistics, drastically cutting down costs. They also partnered with FedEx to offer next day delivery of bouquets to the rest of the nation.
By outsourcing their logistics, BloomThat cut their monthly losses by over 90% to 15,000 dollars.
There is a simple takeaway from this example: businesses should focus on what they do best—their core competency. For a growing business, that may be customer service or great products or beautiful flowers. For Deliv, that’s delivery.