“Together we are stronger internationally”23 October 2018
Opportunities for growth are sometimes a long way away. Digitization makes it possible to serve markets in other continents. GROW discussed this with Steven van Schilfgaarde.
Royal FloraHolland is already the largest marketplace in the
world. What are your ambitions now?
"The demand for flowers is increasing, especially in countries with high growth rates. China is one example of this, but in other Asian countries, consumers are also buying more flowers, and above all, more often. This is also the case in Eastern Europe, with Russia, Poland and the Baltic states leading the way.
It is my ambition that the Dutch floriculture industry should play a significant role in these countries. China is expected to have an online flower turnover of 7.5 billion euros in 2019. That is more than the Netherlands' total flower and plant exports. I think this clearly shows the potential. Our growers in Africa naturally also recognize the great opportunities, but they also realize that it is not feasible to ship flowers from Kenya and Ethiopia to China via Aalsmeer."
"If we want to successfully establish a position in countries outside Europe, then the role of Floriday, as a worldwide digital supply platform, is of crucial importance. International growers can showcase everything they supply through Floriday. Linked to sales channels, this creates a powerful digital ecosystem. China is a good example of how this can work.
We will have to establish the logistic infrastructure in collaboration with partners such as exporters or transport companies. However, the transactions on the digital marketplace are the starting point from which the logistical and other services must be coordinated. We therefore need to set up so-called trade lanes with our partners, and not just between Africa and China. This could also be between Columbia and Ecuador on the one hand and Asian countries and, for example, Australia on the other hand."
Our man in China
"This is easier said than done. The market in China can currently be characterized as "local for local". Still, there is much interest in China for flowers from Africa or Europe because of their superior quality. On the other hand, flowers and packaging have to comply with strict specifications. In China, they do not work with agents who manage the handling, so this has to be done by the growers themselves. Our growers in Africa are not accustomed to this.
It is also important to have proper financial settlement. If a Chinese customer wants to do business with us, this needs to be processed through a Dutch incorporated business (BV). Many issues like this need to be addressed. We have our own office in China, which we share with our local partners. Martijn van Os is our man in China. We are not only gaining extensive experience, we are already doing business. We are developing a Chinese webshop in collaboration with a local partner. A local presence is essential, especially in China.
"With an eye on internationalization, we need to modernize our existing tools. Strengthening the auction clock is also of great strategic importance in this context. The clock still guarantees an optimum price, but we should not make the mistake of assuming that what works well here will be successful elsewhere too. Each market has its own specific characteristics. In one country the florist is the most important sales channel, whereas in another country this may be the supermarket.
Online growth also varies considerably. We also need to learn from successful examples elsewhere. In South America, the supply chain is integrated with the grower and is not based on cooperatives. In some ways, this works more efficiently. So let us work with our partners in the chain to find a solution to this through cooperation, enabling further improvements to business operations. I am convinced that this way we can expand our leading global position."
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