Rose Product Market Plan 2015Collaborating on initiatives

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Collaborating on initiatives

This brochure presents the Rose Product Market Plan. The plan was drawn up by your Rose product table. You can read about developments within the Rose product group and its goals. You will also find information about the initiatives FloraHolland coordinates to work with you to improve the product group. The product market plans of FloraHolland are based on knowledge. We collect and analyze data and facts, in order to subsequently make well-informed choices. We do so together with our members. All product marktet plans are have been created by our product tables, after consulting the FloraHolland Product Committees, in which our members are represented. FloraHolland offers commercial support to growers and customers daily. Product market plans focus on the development of a product in the long term, thus contributing to the goals pursued by FloraHolland: better margins for our members and their customers, and more people spending more on flowers and plants. These goals can be found in the FloraHolland 2020 strategy. Our product tables also contribute to the ambitions of the FloraHolland 2020 strategy, because the product tables use the best knowledge of the global floriculture industry for their product market plans. Next, the initiatives in the plans help increase the market share for your product group. Or contribute to a decrease in supply chain costs. In that way, the product tables and the product market plans connect relate your product group to the FloraHolland 2020 strategy. You can read more about the product tables elsewhere in this brochure.

Table of contents

Collaborating on initiatives 3

What FloraHolland can do for you 5

From product table to product market plan 7

From idea to initiative 8

Prioritization 9

Study sales in boxes vs. water at the clock 11

Map out global Rose developments and share findings 13

Promote sales in the corporate and events market during slow periods 15

Study consumer behavior and share findings 17

Would you like to participate or receive more information? 19

What FloraHolland can do for you?

IntegratedIn 2014, FloraHolland changed the commercial support of suppliers and growers. Instead of a separation between the auction clock and direct flows sales instruments, we now approach the market as one, per product group.

Knowledge and coordinationIn addition, FloraHolland is the knowledge and coordination center of the horticultural supply chain. With this knowledge we advise and connect growers, suppliers and customers in our marketplace.We do this in the following manner:• We collect market and product knowledge. We actively share this knowledge with growers

and customers.• We provide advice based on this knowledge. This advice contributes to stable pricing.• We coordinate initiatives in which members and chain partners collaborate with

FloraHolland to improve their product group.

Product tablesFloraHolland moreover establishes ‘product tables’, which provide support to one or more product groups. A product table is multidisciplinary and consists of the product team, complemented by account managers, employees at local offices abroad, order risk advisers and other disciplines.

In addition to the Rose product table, FloraHolland has the following product tables:Year round flowers, Assorted Flowers, Bulbs & tubers, Seasonal plants, Year Round Flowering Plants, Green Plants, Orchid, and Nursery plants.

The employees of the product tables provide marketing and purchasing advice to growers and customers. They do so with a focus on a broad and deep assortment through our various sales instruments. The product coordinators are responsible for the progress of the product market plans.

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Product team members:

Product coordinatorsThe coordinators provide independent advice on sales to growers and customers. They also inform advice about the FloraHolland sales instruments: clock, direct and digital.AuctioneersThe auctioneers ensure a broad and deep assortment at the clock. They also inform growers about day trade and the auction location.Day trade specialistThe day trade specialist helps growers and customers with the use of the digital commerce platform FloraMondo. He brings growers and customers together at the ordering level. In doing so the day trade specialist works closely with the auctioneer.Sales supportThe sales assistant is responsible for the contract management of strategic transactions and supports the team in commercial activities.Team managerThe team manager provides leadership and is ultimately responsible for the result.

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From product table to product market plan

Our product tables follow the same steps for each product market plan.

Collective startTogether with the FloraHolland Product Committee (FPC), the product table sets up a supported approach. Based on this approach, the product table develops possible initiatives.

Knowledge is the foundationThe product table collects information for a solid foundation in two ways: through interviews with growers and customers, and through the analysis of facts and data.

Make choices togetherThe members and product tables together determine the opportunities and initiatives. The results of the study determine the direction. The members prioritize the initiatives. The product table subsequently sets up the product market plan.

ResultThe product table drafts a project plan for the four initiatives with the highest priority. This plan also describes the practical implementation. These initiatives contribute to the development of the product group in the coming years.

Rose Product Market Plan: From idea to initiative

There is certainly no lack of ideas in the Rose product table! Fed daily through contact with growers and customers, the Rose Product Market Team knows what is going on, however, a solid foundation is needed in order for an idea to grow into an initiative. To this end, the product table formulated ten assumptions or research questions. These were presented to the FloraHolland Rose Product Committee (FPC Rose), because a good product market plan can only come about in close cooperation with our members. FloraHolland’s Market & Information department subsequently gathered factual information. Some assumptions or questions were underpinned by it, while others turned out to be incorrect, which in turn led to new insights. All information and insights in turn formed the basis for possible initiatives for the Rose product table.

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Example research question: from wholesale to retailHas the shift from wholesale to retail had a significant negative effect on price? By significant, we mean more than 10%. The answer is yes, however, there has not been a genuine shift. Increasing sales through the retail channel has however had a negative effect on price. The retail channel has grown relatively quickly. Nonetheless, the wholesale segment has still shown some small growth. The wholesale segment is still three times larger than the retail segment. The growth in retail through the supermarket channel in particular explains the negative effect on price. The price in supermarkets is more than 70% lower than average for all lengths.

Example research question: price peaks and dipsHave the seasonal (price) peaks flattened and are there additional dips? No, this is not the case. The price peakes have not flattened and the dips have also not increased. There are still many fluctuations. We are still seeing dips during the year, in whichsupply and demand converge insufficiently. We are also still seeing peaks around certain holidays.

Ten initiatives were defined

The Rose product table defined ten initiatives, divided into three themes: product, market and consumer. These themes are central to the product market plan.

Product• Gain insight into changing product characteristics during the chain• Make better use of the novelty block at the auction clockMarket• Map out global Rose developments and share findings• Map and share USA & Japanese market insights• Study sales in boxes vs. water at the clock• Facilitate growers and customers in developing retail conceptsConsumer• Study and share consumer behavior• Devise a detailed Rose promotion plan and present it for approval• Promote sales in the corporate and events market during slow periods• Expand Dutch Rose Week to Germany

Test tourThe Rose product table presented the initiatives to the FPC Rose. Following agreement of the FPC Rose, the product team focused the attention of growers in the areas with the largest number of members on the initiatives. Ethiopia, Kenya and the Netherlands were visited during this test tour. Based on feedback received, the Rose product table identified the initiative priorities.

GoalsAll four chosen initiatives contribute directly or indirectly to the main objectives of the Rose product table: raise the return at the farm for our members and achieve higher average prices for each segment. In addition, lower costs in the supply chain play an important role, because of the international playing field of the product Rose.

On the following pages you can read more about the four prioritized initiatives.

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Four initiatives will be given priority in 2015: Study sales in boxes vs. water at the clock Map out global Rose developments and share findings Promote sales in the corporate and events market during slow periods Study and share consumer behavior

The other initiatives are lower on the agenda in 2015, with the exception of the initiative ‘Draft the Rose Promotion Plan and submit it for approval’, which initiative is fifth in the list of priorities. The research results into consumer behavior will be integrated into the Rose Promotion Plan. In 2015 we expect to present a draft to the FPC Rose.

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Study sales in boxes vs. water at the clock

Growers are constantly looking to improve their return. This can be achieved by increasing chain efficiency. At the request of growers we examine whether they can market their product differently at the clock, because growers believe that the clock is not sufficiently in line with the market. The expectation is that customers also want to buy in boxes. To increase chain efficiency, customers want the choice to buy in water or in boxes. Our analysis shows that direct flows in boxes are continuing to increase while clock sales are decreasing. Innovation is therefore important.

This is what we are going to doWe will examine whether there is demand in the market for the auctioning of Roses in boxes at the auction clock. To do so we will measure the interest in Roses in boxes at the clock in comparison to the current assortment of Roses in water. We will investigate existing clock buyers and buyers who buy remotely via a Dutch exporter. We will also consider the impor-tance of chain efficiency, and the increase of the margins for growers in the study.

Involvement of growersWe will engage a group of growers in the design and implementation of the study. They will act as a sounding board.

What can you expect?The study will provide you with qualitative and quantitative data on market demand. We will give you a realistic assessment of the feasibility of auctioning boxes at the clock. Depending on the outcome of the study, the next step could be a pilot phase where we test the implementation.

When?We will complete the study in June 2015. Along with the FPC, we will decide whether there will be a pilot phase.

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Map out global Rose developments and share findings

In this initiative we inform growers about the developments of the Rose product category. Production, the market and actualities are key. We focus specifically on developments of not only our members, but global developments as well, so that growers and customers can increase their knowledge of other markets and know where there are opportunities or threats. The Rose product category is under continuous global development, which is why actuality is also a theme in this initiative. We inform our members proactively.

This is what we are going to doWe will inform growers and customers about the global developments of the Rose product category. We will also share information about topics that are relevant to the Rose product category. We will identify these themes with our growers and our customers. Examples of themes are certification and country scans upon sale.

Involvement of growersWe will check with growers and customers whether our information meets demand.We also want to hear what information they are still missing.

What can you expect?You will be given insight into the global Rose flows and developments within the product group. This will take the form of a product market report and themed reports. We will also further inform you by means of a product calendar about the assortment of other cut flowers per season.

When?You will receive a product market report and a cut flower calendar during the third quarter. You can also expect a themed report at the end of the third quarter.

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Promote sales in the corporate and events market during slow periods

In certain weeks of the year, supply and demand struggle to meet, for example during holiday periods. These are the ‘slow periods’. Within the current sales channels it is not easy in the short term to increase the demand for Roses. We do see opportunities for expansion into the corporate and events market. With new sales in these markets, growers and customers can achieve better returns during slow periods.

This is what we are going to doWe will provide insight into the different peaks and dips of the Rose product category throughout the year. We will also look at how those moments relate to peaks and dips of other cut flowers. We will identify a number of moments when prices are under pressure. Together with growers, customers and possibly a specialized agency, we will support and encourage entry into the corporate and events market.

Involvement of growersWe will carry out the concrete implementation of this initiative, together with growers and customers. We will also ask for flexibility from growers, because the delivery specifications may on occasion be different from usual, which has to do with the needs of the corporate or events market to which we will then deliver.

What can you expect?During slow periods we will offer alternative sales opportunities in the corporate and events market.

When?In June we will present an action plan with a clear proposition about how we want to approach the corporate and events market. The following is a schedule of activities. We will keep you informed about the steps we take.

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Study and share consumer behavior

Do customers opt for the Rose because it is cheaper or because the colors are more appealing? Or is it because Roses always bloom and have a long vase life? Do consumers want Roses with a short length to place on the table, or longer lengths in order to process them in a special arrangement? In our industry it is still new to reason from the consumer’s point of view, while doing so is likely to be profitable. Consumer information helps us to respond to the needs of consumers and to produce according to consumer demand. Ultimately, consumers should give preference to the Rose over another product.

This is what we are going to doWe will develop an understanding of the needs and the (buying) behavior of consumers. We will do this by carrying out specific consumer surveys. For this, we will use, among other things, consumer panels. Questions about the different steps in the purchasing process and percep-tions of consumers will hereby be taken into account. We will make transparent consumer behavior in the most important markets in Europe. We will share the results with growers and customers and take them into account in the promotional plan, because the result gives insight into who the consumers are, and what they are looking for and expecting from the Rose. This will allow us to define a strategy and draft a Rose promotion plan.

Involvement of growersWe will test the insights among growers, and help growers to put these insights into practice. Where necessary, we can add depth with follow-up studies, for example, to get an even clearer picture of the wishes of consumers.

What can you expect?You will gain insight into the behavior of consumers and their preferences for the Rose product category. These insights will be integrated in the draft of the Rose promotion plan which will be presented to the FPC Rose later this year.

When?In June 2015 the first basic consumer insights will be produced and shared with growers and customers. More information will be available as the year progresses.

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Would you like to participate or receive more information?

The implementation of these initiatives will take place under the direction of the product coordinators. Would you like to get involved with the initiatives? If so, please contact one of the product coordinators or FPC Rose.

Contact person Position

Leo van Rijn Product coordinator Ethiopia and FPC Rose contactpersonT +31 6 5364 6847 E leovanrijn@floraholland.nl

Ferry Schoneveld Product coordinatorKenya T +31 6 2239 8008 E ferryschoneveld@floraholland.nl

Will Zuiderwijk Product coordinator The Netherlands T +31 6 5316 1553 E willzuiderwijk@floraholland.nl

Janneke de Jong Product coordinator Internationaal and projects T +31 6 4614 5194 E jannekedejong@floraholland.nl

Matthea van der Molen Rose Product Team Manager T +31 6 4614 5207 E mattheavandermolen@floraholland.nl

Mark van der Hulst FPC Rose Chairman T +31 6 1094 5025 E mark@vanderhulstrozenkwekerijen.nl

Do you have any questions or comments? Or would you like more information?Then send an e-mail to productteamrose@floraholland.nl.Or contact your FloraHolland account manager.

Collaboration between growers on product market plans are subject to anti-trust law. Collaboration in the creation of initiatives stated in this brochure has only taken place as long as this is compliant with anti-trust rules.

floraholland.com

FloraHollandLegmeerdijk 313P.O. Box 10001430 BA AalsmeerThe NetherlandsT +31 (0)88 789 89 89F +31 (0)297 39 00 39E klantenservice@floraholland.nl

Photos: The Flower Council of HollandFunnyhowflowersdothat.co.ukFloraHolland