The first weeks of March showed the vulnerability of the flower market due to the Coronavirus. "The market was absolutely frozen and wasn't ready for this", says Bohdan Tustanivskyi of Profiflora, a consultancy company for businesses in the floriculture industry. "Now, we can analyze the problems and think about avoiding it in the nearest future." He shares his first conclusion of the flower market during this COVID-19 pandemic and recommendations for the industry to develop in the future.
Diversification
Tustanivskyi stresses that most growers concentrate on one direction: auction, wholesale or retail, and diversification is needed. "As we see and understand now: Growers need to find new ways of sales. It takes more time, it needs more strength and it demands a large administration of invoicing, deliveries, phone calls et cetera. But the first thing that needs to be done - is thinking about different sales channels."
Online sales
Over the last weeks, online sales increased sharply with many companies starting to sell directly to the consumer. it creates huge new possibilities for flower suppliers, but according to Tustanivskyi, most countries are not ready for B2C online orders. "If it's done, a lot of complaints come from the clients: 'it's hard to order', 'there's a very small range of choice', 'we have to wait very long', etc. Especially in Eastern Europe. It's a new market where it is really hard to organize one platform for the whole country. It is a big chance for small local companies in every town to do sales through social media. It needs to be simple, fast, and what it looks like on the picture is how it should look in real life."
Country and business
A common policy for the flower market branch with governments is another point he highlights. For years, there hasn't been such a common policy, but has proven to be necessary as the flower market is injured due to Corona, more than any other branch. "Currently, it is treated like in the retail, the energy industry, coal, and others. If we want to have a fast decision from the government, the flower branch has to be on top of it."
Grower and supplier
The main problems are on the shoulders of the growers, he continues. "In other businesses, we see that suppliers somehow avoid big losses by making the office rent smaller, letting people work half days and thus reducing labour costs, or not make margin. If we compare that with growers, they can't stop the heating or CO2 because it will kill the flowers. Growers are losing millions and many of them need a lot of support."
Logistics
The flower market is very dependent on logistics. "The situation inside Europe is not so bad, but around the world it is. There are no passenger flights from Africa (30% of all the flower deliveries) and the cargo goes down 30 - 40%. So the growers in Zambia, Rwanda and Kenya are cut off from Europe. Also, cargo costs twice as much, up to 5 euros per kg. The situation from Columbia and Ecuador is similar."
Holes in the market
No matter the suggestions and the situation, growers need to work on maximum as chances will arise again. "Even though, everyone is minimizing costs now, after COVID-19 there will be holes in the market. In Poland for example, there is a big lack of local flowers."
For more information:
Profiflora
Bohdan Tustanivskyi
www.profiflora.pl
office@profilora.pl