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Information @ a Glance

General
  • The flower auctions play an important role in the distribution. Flowers and plants come here together and the florist or wholesaler can buy the flowers in front of the clock, or even by computer or Internet. A very large assortment flowers with a high quality find their way to the world-wide consumer.

Technology

  • Electronic markets are defined as interorganizational information systems that allow the participating buyers and sellers to exchange information about prices and product offerings. Research on the effects of IT on exchange organizations and processes is relatively new. Early research applied transaction costs and agency theory to predict shifts from hierarchies to market form of organizations.

  • The demand for traditional flowers for religious purposes is quite large, especially around the temple towns. The production, harvesting and marketing of traditional flowers for local marketing are typical women's activities. However these flowers are produced in open field conditions mostly during the mild winter months without use of any advanced technology. As a result the quality and the quantity available for marketing are quiet heterogeneous and vary according to the prevailing weather conditions.

  • Recently large scale commercial companies have started to invest in the Floriculture sector, sometimes in a j oint venture agreement with foreign companies. These ventures aim at the production of high quality flower production to supply the local market throughout the year but also for export. Greenhouse technology is being introduced from abroad with high investment cost which is not adapted nor affordable by the small scale women producers.

Report

  • Driven by high-tech production technologies, floriculture is capital as well as labour intensive. Cost of capital and labour critically affect the competitiveness in the industry and determine profitability at the enterprise level. Competition is between the grower exporters in the low cost production regions, such as the high tropics, and the high cost, intensive production units of the temperate countries. The recent fall in price of imported flowers and the higher cost of airfreight are improving the competitiveness of the domestic producers in the temperate countries which are also the markets.

  • Producers can take their flowers to the auction every evening, place them on the special auction trolleys that can be conveniently hauled into the cold stores for over night storage, taken out the next morning and the trolleys can be passed across the clock for auction. The money is deposited into the grower’s bank account after deducting all charges which include auction and handling cost. In this marketing sequence, the locally grown flowers are sold much fresher than the imports and therefore get a premium. The payment for all sales through the auctions is fully assured. 

  • Today, flowers represent a global billion-dollar industry. In 2000, the market for cut flowers and potted plants reached an estimated total of 6.8 billion euro in global sales. Germany is one of the most important core marketplaces. More than a third of all cut flowers are sold in  Germany. Each German spends almost 85 per year on cut flowers and potted plants. The flower market will continue to grow, and by 2012 should surpass today's values by 45 percent, according to the latest prognosis of the Dutch Flower Office (BBH), the marketing and sales promotion organization of the Dutch ornamental plant sector. The Netherlands is the indisputable global market leader among flower exporters, and according to the prognosis, its market share will continue to grow.

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