Articles
DUTCH FLOWER BUSINESS: COMPETITIVENESS AND MARKETING STRATEGIES
Traditionally the Netherlands dominates the international trade in cut flowers.
However the numbers of cut flower producers are still growing especially in Africa and in South-America.
Even more these countries are very successful in supplying the highly developed Western European and Northern American markets.
Their market share increased at the cost of the Dutch share.
The objective of this paper is discussing:
- A method for measuring the competitiveness of the Dutch cut flower business at all levels in the chain.
An important issue is the performance of all actors in the market channel.
The analysis is mainly focussed on the role of the wholesalers. - The results of an empirical investigation using this method.
- Suggestions for improving the market strategy of the Dutch cut flower industry.
The strength and weakness of the Dutch wholesalers in cut flowers have been clarified by analysing the performance of the main competitors of the Netherlands.
Elements of the performance are market adaptability, supply-chain effectiveness, cost & efficiency and strategic potential.
Secondly the opportunities and threats have been investigated on the most important market and on an emerging market for the Dutch cut flower business.
Aspects are trends in consumer behaviour and in the distribution channels.
The overestimation of their own performance of the wholesalers, the lack of willingness to make arrangements for longer periods and relatively high cost prices are some of the weaknesses of the Dutch business.
However logistics, the supply of large quantities of several varieties and an overall good quality are some of the strengths.
The Dutch cut flower business should combine their actual strategy mainly based on price with on demand-oriented strategy.
Long-term agreements, guarantees based on a ‘Code of Good Practice’ and specificity of the Dutch flowers are obligatory elements for the future strategy.
Examples of strategies are: an approach directed towards the supermarkets has been suggested for the quality oriented British market, with a strong position of the supermarkets.
A price oriented approach fits better to German market, where the small-scale florists have an important market share.