It may be a surprise to many people (as it was to me) that Mother’s Day is celebrated in numerous nations across the world including Norway, Venezuela, Tunisia, Taiwan, Lebanon, Armenia and Serbia. While the date and traditions of the celebrations vary, flowers are a popular gift for moms in many countries including the United States, Canada, France, Argentina and the United Kingdom. It also might come as a surprise that there’s a good chance the vibrant flowers delivered to mom’s doorstep in New York, Québec or Paris started their journey thousands of miles away.
Traditionally, growers stationed themselves near their largest consumers – Japan, Western Europe and North America. In recent years, however, major flower production centers have been established in developing countries like Colombia, Ecuador, Ethiopia and Kenya, where the labor costs and climate are more favorable. Many countries including Japan, Russia and the United States have increased cut flower imports from these growing production centers, taking market share away from the Netherlands, which has long been a bastion of the global cut flower trade.
It typically takes about 12 days for flowers to reach their intended recipients. Flowers may be transported via plane, inspected by customs, and transported on a truck either directly to the customer, or to a flower shop that handles the delivery. While the flowers are kept in temperature-controlled environments, there are many chances for things to go wrong as they pass through different hands. For example, they can be damaged if shipping containers sit for long periods of time on hot asphalt during a scorching summer day.
When you think about it, it’s pretty amazing that flowers grown in Colombia, transported thousands of miles, and delivered to millions of mothers in dozens of countries on numerous dates throughout the year usually arrive unscathed. Efficient, optimized supply chains are responsible for this achievement. These supply chains are also vital to the survival of growers, wholesalers and retailers, who are facing increased competition and risk.
According to RaboResearch Food & Agribusiness, global floriculture sales have become very fickle. Growing cut flowers in developing countries is challenging despite low production costs, favorable climates, and improvements in efficiency and quality. Domestic demand is extremely low, and producers are grappling with volatile exchange rates, insufficient air freight capacity, high transportation costs, and a difficult political and social climate. While the Netherlands is still a major player, its share of global cut flower exports has been declining for years, dipping from 50% to 43% over a ten-year period.
To not only survive but thrive in challenging environments such as this one, control over the supply chain is crucial. Companies involved with floriculture, coffee, wheat and other agribusinesses must not only perfect the physical aspects of the supply chain – they must also ensure they have real-time data and analytics for optimizing decision-making, enabling accurate forecasting, and enhancing partner collaboration. As noted by RaboResearch, suppliers must prepare for the unexpected and have the flexibility to cope with various future scenarios if they are to be industry leaders.
Eka’s agriculture commodity management software platform, Insight CM®, maximizes profits and provides a competitive edge by enabling companies to optimize their supply chains from both a physical agricultural commodity and financial risk perspective. This next-generation CTRM/ETRM software solution captures, analyzes and manages physical trading, procurement, logistics, processing, and compliance, and provides “what-if” analysis tools, forecasting tools and intelligence capabilities to improve decision-making and mitigate risk.
Agri-marketing companies can also build grower loyalty and reduce procurement costs with Eka’s Supplier Collaboration Portal, which provides real-time data for managing sales, purchase and delivery.