Dutch flower Cluster summary

The Netherlands has always been a major player on the world market for cut flowers. Around 60% of the world export market for flowers is traded in The Netherlands, with sales of $16,7 billion of Floricultural products in 2008. The Netherlands started cultivating and growing flowers with tulips from Turkey by the end of the sixteenth century. As a market for flowers emerged, greenhouses of glass, heated by gas were built and in 1908 the first flower trade organization was founded.

In 2009, there were two flower auctions (of which FloraHolland is the biggest in cut flowers) trading 20,000 varieties, 3,770 growers, 693 exporting companies and 20+ associations, councils, research centers et cetera. The square meters of greenhouse were declining in The Netherlands, but yield was growing through new production techniques. Production was growing rapidly in competing countries with a more favorable climate and lower cost of labour like Columbia, Ecuador and Kenya, but most of these flowers were still traded via the Dutch auctions and ran through its extensive logistic system.

In 2009 44.8 million flowers were sold in 125,000 daily transactions, most of them being roses , chrysanthemums and tulips. In 2011, The Dutch Flower Cluster faces some major strategic challenges. Rapid technological developments, for instance internet applications and remote buying, pose a potential opportunity as well as a challenge for the Flower Auction. Another challenge lies in the changes in the cluster network and linkages. Examples are the emerging competition from African and Southern American countries, and the links with economic development of these countries. Increased prices of fossil fuels put pressure on Dutch growers (natural gas for the greenhouses) as well as on transportation, comprising a large portion of product cost.

The Netherlands has always been a major strength in the global cut flower market. In fact, more or less sixty percent of the global export market for cut flowers is traded in the Netherlands. In 2009, there were two main Dutch flower auctions, including FloralHollad, the biggest auction with regard to cut flowers. The auctions are the hub of the cut flower industry where researchers, growers, exporters, distributors and retailers join together to play their several(prenominal) roles within the industry.

Recently, The Dutch Flower Cluster has had to face many major challenges. Emerging emulation, technological changes, issues with logistics, increases in government polity etc…has forced the Dutch to be innovative and make fair efforts to keep its position in the global flower market. We purpose that the Dutch Flower industry detain operating internationally, displace away from the auction model, and not increase tariffs and trade barriers to the competition and not decrease government regulations.

 Even with increasing cost and increasing competition, the Dutch flower industry is a appoint player in the global flower market. In pose to keep competitive and stay profitable, they must expand and continue international business. This same reason is why the Dutch should not increase tariffs and trade barriers to other, international, competitive flower growers. The Dutch should in like manner embrace new technology and move away from the tralatitious auction model. This can make the process of buying easier thereby increasing retailer loyalty and perhaps securing relationships with new retailers.a