CFD Strategic Planning & Analysis 2 — Questions and Answers
Question 1: A floral design studio is conducting a SWOT analysis. Which of the following belongs in the 'Threats' category?
- A new wholesale flower market opening nearby (Correct answer)
- The owner's 15 years of industry experience
- A growing customer base for wedding florals
- High-quality proprietary design software
Correct answer: A new wholesale flower market opening nearby
A new wholesale competitor entering the local market is an external threat that could erode pricing power or customer share.
Question 2: When performing a competitive analysis for a floral shop, which metric is MOST useful for benchmarking market positioning?
- Number of vases owned
- Average transaction value per customer (Correct answer)
- Number of social media followers of competitors
- The color palette used in competitor ads
Correct answer: Average transaction value per customer
Average transaction value helps benchmark pricing strategy and customer spend relative to the competition.
Question 3: A floral designer wants to expand into corporate event florals. What is the FIRST step in strategic planning for this expansion?
- Purchase additional cooler space immediately
- Conduct a market needs assessment for corporate clients (Correct answer)
- Hire two new designers right away
- Redesign the shop's retail floor plan
Correct answer: Conduct a market needs assessment for corporate clients
A market needs assessment identifies whether demand exists and what corporate clients require before committing resources.
Question 4: Which financial document is most critical for assessing the long-term viability of a floral business expansion plan?
- A daily sales log
- A multi-year cash flow projection (Correct answer)
- A single-month profit and loss statement
- An inventory count sheet
Correct answer: A multi-year cash flow projection
A multi-year cash flow projection reveals whether the business can sustain operations and debt service over the expansion period.
Question 5: A florist identifies that 70% of revenue comes from 15% of customers. This finding best supports which strategic action?
- Reducing inventory variety
- Developing a loyalty or VIP program targeting high-value customers (Correct answer)
- Cutting marketing spend entirely
- Eliminating walk-in retail sales
Correct answer: Developing a loyalty or VIP program targeting high-value customers
The 80/20 principle suggests focusing retention efforts on the high-value segment to protect the majority of revenue.
Question 6: In strategic planning, 'market segmentation' for a floral studio would most likely involve grouping customers by:
- Their favorite flower color
- Purchase occasion, frequency, and budget level (Correct answer)
- Alphabetical order by last name
- The zip code of the nearest competitor
Correct answer: Purchase occasion, frequency, and budget level
Segmenting by occasion, frequency, and budget allows targeted marketing and service offerings for each customer group.
Question 7: A floral business sets a goal to increase gross revenue by 20% in 12 months. To make this a SMART goal, what element is still needed?
- A vague description of the desired outcome
- Specific tactics and a measurable baseline starting point (Correct answer)
- A motivational quote posted in the shop
- Approval from a flower wholesaler
Correct answer: Specific tactics and a measurable baseline starting point
SMART goals require a specific baseline and defined tactics so progress can be measured against a known starting point.
CFD Strategic Planning & Analysis 2
A floral design studio is conducting a SWOT analysis.
Which of the following belongs in the 'Threats' category?