Industry
The flower industry is highly competitive, based on fashion trends and a highly perishable product. This means that quality, innovation and productivity are extremely important. It also means that prices for any product can undergo major fluctuations on a day-to-day basis.
The export value of cut flowers is worth 25 billion dollars (US) per annum worldwide. The top four exporting countries are Holland (US) 1590 million, Columbia (US) 430 million, Kenya (US) 70 million and Israel (US) 135 million. Japan is the largest producer of cut flowers in the world with a production area of 18 100 (ha) all Japans domestic product is consumed internally. Along with Germany, and the USA it is a major importer of cut flowers.
New Zealand makes it into the top twenty exporters with an annual value of (US) 30 million dollars. New Zealand has 2329 (ha) of land under use to produce cut flower crops and 1362 farms producing crops for this market.
The average annual price of cut flowers has been consistent or declining slightly in the last decade. The impact of this decline on profits has been attenuated through productivity growth.
Although Cut Flowers are competitive it is important for the people involved in the New Zealand Flower industry to work together to promote New Zealand Product. An overall marketing and promotion strategy would be beneficial to all concerned.
The flower industry involves a large number of people:
Breeding Companies: Use conventional breeding to develop new varieties of cut flower.
Propagating Companies: multiply stock purchased from breeder and sell plants to flower growers – in some cases the grower is the breeder and the propagator.
Growers: They grow the plants and vary in size from large farms to small. They can also have their own pack house – under whose label they export.
Transporters: These are the people who take the product form one destination to another. Rapid distribution of product is necessary to get the freshest possible product to the customer on time. It is important that the logistics run smoothly to keep the customer as a customer.
Exporters: Arrange the transportation of flowers from their growers, by air or road, to buyers. In New Zealand they have contacts with auction houses and wholesalers in other countries. They sell on behalf of the grower, or buy off the grower at a fixed price and take the risk on the market.
Wholesalers, wholesale markets and Auctions: Provide retailers with a large range of flowers and growers a means to sell flowers to a wide range of customers.
Florists, Flower shops, supermarkets and chain store outlets: While florist and flower shops are still the main outlet for flowers, supermarkets are becoming a major playing in flower retail especially in the USA.
The aim of all these people should be to deliver a product that allows the consumer – whether they are buying a $50 bunch from a florist or a $5 bunch from the Supermarket – to enjoy the beautiful colours and fragrances for as long as possible.
The Top Ten Cut Flowers on the Basis of Auction Sales are:
1. Rose
2. Chrysanthemum
3. Tulip
4. Lilium
5. Gerbera
6. Dianthus
7. Cymbidium
8. Freesia
9. Alstromeria
10. Gypsophilia
Many developing countries have become involved in growing cut flower crops and are able to produce large quantities of flower crops because of low land costs and cheap manual labour. However they often produce low quality produce, as skilled technical employees are hard to come by and they have difficulty arranging effective transport solutions to export product.
Growers should keep in mind that the flower industry is extremely competitive. A good reputation for quality and presentation are major factors in maintaining positive relationships with both the exporters and the buyers. Growers who have established a good reputation will find it easier to sell their product.
Things to keep in mind about quality:
* All products should be free from disease and insects.
* All products should be undamaged
* Products should be of the correct grade and be of optimal quality for that grade.
If you are just starting in the industry it is important to:
* Have a long-term plan for your farm
* Identify your market; keep yourself informed about it.
* Invest in quality from the initial stages to the final product.
* Network; find people with expertise that you can utilise.
* Produce products that suit the conditions on your property and are appropriate to your market.
* Ensure that you have transport worked out ahead of time and that it is efficient, and cost effective
* Have a clean handling and storage area
* Don't rush into diversification - outlays are usually expensive. Stick with what you do well - returns are often cyclical.
* Do jobs on time with a sense of urgency. Have equipment ready in advance of sowing and harvest.
* Give staff responsibility and allow input from them.
* Be willing to take calculated risks.
As new countries enter the stage as exporters and their quality control and growing methods improve it is up to the international flower growing community to invest in their future by utilising new technology, reducing waste and pollution, and concentrating on making the most out of their product rather than making the most product.