Introduction
The reason for growing flowers and other floricultural crops is to deliver a first rate, quality product that appeals to the consumer, is value for money and encourages repeat sales. Doing this successfully helps the grower earn a living and achieve a fair return on capital invested.
Ultimately the market is the consumer. The flower product will need to appeal to consumers as they browse retail outlets or catalogues.
There are many stages between the grower and consumer — wholesalers, exporters, auctioneers, florists or supermarket buyers and the local shop. Each will have specific requirements but all are trying to entice the consumers to spend their money on flowers.
As a grower, you will deal with parts of this chain depending on your circumstances, but the requirements are very much the same.
Global market
Not only is it a global market but the competition is strong. Flowers are grown around the world and often in countries with lower cost structures or closer to our main markets.
Western Australian producers can only compete if their product stands out from the crowd in terms of quality, presentation and uniqueness. However, it still has to represent good value for money.
How to compete
We need to make sure we:
- research and plan the mix of varieties that are going to achieve good returns
- grow these to match stem length and disease/insect-free status requirements (particularly for export markets)
- schedule to flower or produce (foliages) at the right time
- pick at the right stage avoiding old flowers as these will only detract from the fresh flowers
- immediately place them in water to hold their temperature and moisture
- pick in early morning, especially during summer
- keep them in the shade or in an insulated vehicle
- get them to the packing shed fast
- treat/disinfect flowers carefully to ensure insect-free status, pulse or treat with preservatives, sugar or appropriate treatment or anti-ethylene pre-treatment if flowers are ethylene sensitive
- trim to a uniform length, grade to uniform lines in both colour, size and shape
- place flowers in the right size sleeve/carton; cool rapidly to 2°C and move to the market in insulated or refrigerated trucks — holding temperature around 2°C
- transfer the flowers immediately to the wholesaler/exporter/florist’s coolroom
- distribute the flowers to florists/retail outlets/consumers in insulated or refrigerated trucks or vans
- ensure that the exporter transfers the flowers from their warehouse to the overseas consumer quickly and directly while maintaining cool temperatures.
At each stage, you need to ensure the product is uniform. One poor flower will discount the whole lot.
Labelling bunches with varietal names or giving different wrapping to a specific florist may help create loyalty. Product branding works to create loyalty — this can be on a state basis or by an individual exporter or grower.
Range of products
Flowers or foliage can be used in many ways — in vases, arrangements, bouquets, wreaths etc. Products needed by florists and arrangers come in several categories:
- display flowers
- focal fillers
- fillers
- foliage.
Generally, display flowers are larger, more striking, more colourful and obtain better prices. Australian native flowers such as banksia, waratah and blandfordia and South African proteas are used in this way.
Focal fillers could include rice flowers, leucodendron, some waxflowers and some thryotomene.
Fillers are low cost flowers used to increase the size of the bunch and provide colour contrasts. They include many flowers including wax and baby’s breath. Foliage is used to provide contrast and a backdrop to other flowers — it bulks up the arrangement with low cost material.
Domestic or export markets
Export markets differ from domestic markets. It would not be worth incurring the high cost of transport to send simple field flowers to Europe. The same applies to relatively low value heavier material. The export market needs to be provided with high value products that can attract good prices. The same can be true domestically but there is generally a place for lower cost bulk flowers.
Flowers are a luxury product and compete with other luxury products such as confectionary and wine for the consumer’s discretionary spending.
What customers want
Because cutflowers are a luxury product, consumers demand a certain standard of quality and value for money. Some quality aspects are colour, freshness, stem length, freedom from pests, fragrance and vase life. Local experience suggests that colour, freshness, disease-free status, value for money and good presentation are major factors in buying decisions.
Fragrance is a personal issue. Some consumers prefer this, others reject it because of allergies and sensitivities.
What florists want
Florists have a wide range of clients from large corporations to senior citizens. Consumers vary and may be elderly, modern home-owners, special occasion buyers and from many ethnic backgrounds.
Different ethnic and age groups have different requirements — young people prefer white and pastels, people from South-East Asia prefer colourful flowers and don’t want white, some Europeans like field flowers.
Florists deal direct with the consumer and get immediate feedback. They are also held more accountable for quality than bulk retailers and casual outlets. Vase life is especially important for florists because customers will return purchases for a refund more readily than they would to supermarkets. This has to do with the expectations of professionalism and the fact they specialise and are expected to know the product.
Consumers want value for money from the florist — a lot for a little. This means lots more presentation.
Florists need a wider range of foliage for arrangements which can be in short supply. Foliage is used to provide bulk and contrast and ensure the consumer gets value for money.
Supplies need to:
- be uniform, tidy and presented
- have good stem strength — this can be a problem due to forced growth by producers
- be good quality
- be free from disease such as botrytis.
They need varietal labels to help people get optimal results with the flowers. Florists may also be interested in seasonal flowers and variety to spark their artistic interests.
They want to differentiate their product from other retailers such as supermarkets. This may mean that growers or wholesalers provide different wrapping and labelling. Otherwise they have to repack into new wrapping at a higher labour cost.
Consumers want to buy and run which means arranged products sitting on the shelf. Durability and freshness are critical. Vase life of at least five days is needed for corporate arrangements.
What wholesalers want
The wholesaler reflects the wants of the consumer and needs:
- value for money
- a consistent product
- availability over an extended period
- variety of product and colours
- vase life
- quality
- the cool chain maintained from farm to shelf.
Although wholesalers can get some types of flowers all year round, in some seasons vase life is poor. Tulips in summer have poor vase life and are not worth stocking. Wholesalers would like a better indication of vase life in different seasons.
When growers stretch production seasons, it is often more costly, quality not as good and shelf life may not be good.
Different flowers have different popularity through the season.
What exporters want
Exporters range from people selling only their own products to others who deal with many growers and large numbers of buyers in many countries. They have continual contact with buyers in major markets and have to respond to market signals.
The market for Australian natives is healthy and expanding. Customers are asking for more and for a wider range of products, although demand for waxflowers is slightly weaker.
End needs are the needs of the consumer — buyers always want something new.
What importers want
They want:
- what they ordered
- delivery on time
- product in good condition
- product with correct documentation.
Australia finds it hard to compete with low cost producers of bulk flowers in South America, Africa and Asia. To compete in the international market, Australia needs a marketing edge. This revolves around new flowers, products and better quality.
New varieties are always in demand and allow us to hold markets and help sell our older varieties. The Department of Agriculture and Food, as well as other research groups in Western Australia, has bred, selected and released a number of new hybrids and varieties having better colours, bud size or vase life, some of which are available from industry.
Having a different technology for postharvest treatment could also help. Australia has had a bad reputation for shattering of waxflowers. With anti-ethylene treatments such as 1-MCP and reducing temperature using the cool chain, shattering is significantly reduced. These flowers can then be marketed as a superior product.
Traditional flowers or Australian natives?
In most world markets, the majority of sales are traditional flowers — carnations, chrysanthemums and roses. The same applies in Western Australia.
However, as the market matures and consumers buy flowers more actively, they become more interested in flowers from different places. The increase in tulips grown in Australia and sold on the domestic market is testament to this. Similarly, overseas markets are buying Australian natives and South African proteas because they are different and colourful. This demand in the mature markets of Germany, Netherlands and Japan — where traditional flowers make up only 50-55% of purchases — is driving the sales of Australian natives.
In all these markets, foliage is also in demand.
Promoting our flowers and their uses can change consumption patterns.
The Spanish and USA markets are described as immature and sales of traditional cutflowers are significantly greater than other flowers.
Buying times
In immature markets, flower sales are most often associated with Mother’s Day, Valentine’s Day, Christmas, Easter and other personal occasions such as birthdays, anniversaries, funerals and weddings.
In Western Australia, Mother’s Day is the most important day to buy flowers. About 37% of consumers buy all the flowers they purchase in a year at this time.
Valentine’s Day and Christmas are the next most important, although nowhere near as many people buy at that time. Days such as ANZAC Day and Father’s Day are not particularly important. This partly reflects the limited number of flowers bought for males.
Birthdays are by far the most significant reason for purchasing flowers for special occasions. Other occasions such as funerals, anniversaries, visiting relatives, dinner invitations and get well messages, are not high on the list. This may be partly due to other options, such a bottle of wine for the dinner host.
Although functions like graduation balls are not high on the list, they may provide opportunities for flowers not suited for other markets, for example, short stem roses or carnations for button holes.
In markets such as Japan, the Netherlands and Germany, consumers are more likely to buy for self-consumption and take flowers to family functions or dinners. The Japanese are very particular about this. The gift and its value are carefully calculated. Traditionally, they have purchased very high quality products such as fruit as gifts when visiting or for special occasions, rather than bottles of wine or chocolate.
Frequency of purchases
Only a very small portion ofpurchasers, buy weekly or fortnightly. The majority buy no more than four times a year.
In Western Australia, consumers tend to buy for special occasions and special days such as Mother’s Day, birthdays, funerals and Valentine’s Day. They tend not to buy for their own use. This suggests that, with improved availability, promotion, presentation and quality, consumers could be convinced to increase total consumption of flowers.
Where are flowers sold?
Flowers are sold through a large range of outlets. Traditionally, it was the florist and a few roadside sales. Many retailers now sell a wide range of products in the trend to become a one-stop shop and capture a greater share of the retail dollar. This means that flowers have appeared in supermarkets, service stations, corner shops, transport terminals, hospitals and liquor shops.
Increasing quantities of floriculture products are being sold by telephone and through the Internet.
Each generally has a specific target market and may not be providing head to head competition. For example, supermarkets, service stations and roadside retailers are more likely to target impulse buyers. These are likely to spend a smaller amount. Consumers looking for a gift for a special occasion are more likely to go to a professional florist and be prepared to pay more.
Supermarkets generally want large supplies of uniform lines at consistent prices and delivery dates. This puts pressure on growers to meet these specifications. Increased sales from outlets such as service stations will also require specific quality and price.
Maintaining the cool chain
All stages of industry expect quality and freshness that can only be obtained through keeping cool temperatures right through the supply chain.
Each part of the chain has to do its job. The emphasis needs to be on keeping flowers at 2°C at all times. All components of the industry need to take responsibility for their product to ensure Australia maintains a good reputation.
Cool temperatures need to be accompanied by ethylene scrubbing. This is particularly important when ethylene-sensitive flowers are transported with other commodities such as fruit and vegetables.
The chain starts with growers using insulated vans to transport flowers from the field to the coolroom. When arranging transport to the wholesaler or exporter, the vehicle should be insulated or refrigerated. The same applies when wholesalers transport flowers to the retailer or florist.
There have been problems with flowers warming during air transport because of lack of cool store facilities at airports, in transit and when travelling with other cargo. It can also happen when product is moved from one plane to another on an indirect flight. At times, cargo is off-loaded when the plane needs extra fuel. Exporters need to ensure freight forwarders and agents have access to coolrooms at the point of arrival.
Packaging
Packaging is important for number of reasons.
It allows mixing of different flowers into cartons to reduce handling and allows through freight. Different carton sizes in different markets will also help. Distinctive cartons, for example using colour or labelling, can also make product stand out.
Acknowledgements
The original material in this page was adapted from work authored by Gerry Parlevliet and Christine Storer and a paper by Peter Batt, Senior Lecturer, Agribusiness Marketing (Horticulture), Curtin University of Technology at a seminar organised by Flowerswest in 2001. It in turn draws on local information from an undergraduate student project by Johanna Pool, a student in a four-year Bachelor of Agribusiness (Horticulture) degree.