Flowers are God's most beautiful creations and the multi-billion dollar industry is hit hard during the COVID-19 crisis. Shabistan Khan has conducted a series of interviews with major Kenyan flower growers to get an insight into the corona hit floriculture industry. PJ Dave Group is one of the largest growers of roses from Kenya. With 240 Ha area under production and more than 5000 people working with them. They sell their flowers to the Dutch auction and direct market. In the below interview the Director Mr. Gopal Dave and General Manager Mr. Santosh Kulkarni shed some light on how they are adapting to the new situation and adopting a strategy to continue the business.
Mr. Gopal Dave and Mr. Santosh Kulkarn
Shabistan Khan: What’s your assessment of the impact of COVID-19 on the global floriculture?
Mr. Gopal Dave: COVID 19 has an impact on the entire world economy. I cannot think of any business which is not affected by this crisis. Being perishable the floriculture industry was hit badly. We have seen millions of auction flowers being destroyed in Holland. It was heartbreaking something we have never seen in history. The magnitude of loss is large. Since March till the 3rd week of April, the situation was extremely bad with growers facing many challenges, low sales and high maintenance of flower growers facing a cash flow crunch. As we do not have control over air freight and clock prices growers lost a lot during this crisis.
Shabistan Khan: Could you tell us about the efforts you have taken at your farm to address the impact of the COVID-19 crisis?
Mr. Gopal Dave: We have taken various measures to tackle this situation. We were closely monitoring the situation at international and domestic levels. The prices at the clock dropped so much that it does not make sense to send flowers to auction in Holland. Also, all the passenger flight have stopped their operations and all the load comes on the freighter. With very few freighters operating freight cost was extremely high, for some destinations more than double. So even exporting flowers to direct buyers is incredibly challenging. Looking at all the scenarios we have stopped the export 100 percent for three weeks. Sent our grading and packing team on leave. Keeping the production team for the maintenance of the crop. Our revenue has stopped but our cost of production remains almost the same.
Shabistan Khan: What do you see as the biggest challenges for floriculture in times to come due to COVID 19 crisis?
Mr. Kulkarni: For floriculture, the biggest challenge with our product is that it is a live product and has a short life span. There is no way we can hold it like an inventory and sell it at better times. Nor is it like an industrial product where we can switch off the Machine and stop the production and switch back on when there is demand. Flowers when not sold are discarded and we have discarded millions of stems during this time. As for now some good things are happening. Some countries are lifting the lockdown and businesses are opening up for us, the other challenge is to send the flowers to our respective buyers as airline operations have not resumed fully. For example, Australia, Japan, and other countries are open now and we received an order, but the biggest challenge is to get the space and send the flowers to respective destinations. Higher freight rate and unavailability of space is the biggest challenge and will be there for quite a long time.
Shabistan Khan: How can companies in floriculture meet the challenge of supply chain disruption?
Mr. Kulkarni: As the aviation sector is badly hit and it will take time to come to near normal, we are trying alternative ways of sending our flowers to Holland auctions. We have attended a conference organized by Royal FloraHolland to work out sea freight mode. We will be sending our first consignment in July first week to test it. We are quite optimistic about it. And we are thankful to Royal FloraHolland for all the help and support they have provided to us.
This will bring down the cost of sending flowers and hopefully maintain a good margin for growers. It will be a win-win situation for all.
Shabistan Khan: During this time of uncertainty, what do firms today need to do to be prepared for the future?
Mr. Kulkarni: The time is uncertain, but it will not remain like this forever. We are hopeful that by August/September things will be ok. For us, our flower quality is of utter importance, so we do not compromise on our crop quality. We have maintained the same standards of fertigation and irrigation as before the crisis. It has a cost attached to it. We have made a conscious decision to do so as we do not want to compromise the quality of our crop in the short-run and pay the price in the long run for bad quality flowers due to poor crop. The second one is more expensive. Safety of people, the safety of crop, and maintaining the client and proper communication is the most important things.
Shabistan Khan: What are the measures taken for the safety of people at work?
Mr. Kulkarni: Safety of our people and the people around us is the top priority for us. We have taken all the safety measures and conduct training programs on a regular basis to educate our people on how to stop the spread of the virus. We check the temperature of every individual entering our farm. Everyone must sanitize their hands with alcohol-based sanitizer and wash their hands. We have installed sanitizer stations at various locations at our farms. Workers has been given masks and must maintain distance while working. We are following basic hygiene and social distancing protocol strictly.
Shabistan Khan: How do you see floriculture in the near future?
Mr. Gopal Dave: During uncertain times like this it is particularly important to be optimistic and as a leader keep your employees motivated. And have clear and transparent communication. We are estimating some certainty by August and September in terms of the market opening and airline operations. Its summer in Europe and during normal times many people plan a holiday and travel. But due to COVID-19, we assume people will remain in their own countries and avoid unnecessary travel. It might boost flower sales as they might buy flowers to beatify corners of their house or send each other flowers to uplift their spirits. It’s like a silver-line in the cloud, even though we don’t have major flower holidays now, we are hopeful people will continue to buy flowers. So, we have some good volumes moving
Shabistan Khan: Any message for folks in floriculture?
Mr. Kulkarni: Stay safe and positive.
Mr. Gopal Dave: Do take care of yourself, your people, stay safe and optimistic. The better times are ahead.