THE DUTCH

FLOWER CLUSTER
International Business
How did the Netherlands build the most competitive flower cluster in the world in a country
with a cold and cloudy climate? How has the Dutch cluster sustained its leadership position?

● Overcoming Climate: Netherlands handled the climatic issues by building nurseries made of glasses
which are warmed by petroleum gas. This aided in developing blossoms everywhere throughout the year
regardless of season. It was one piece of cost, so proceeds with adjustment of innovation was a need to
build productivity.

● Innovation: Dutch blossom group - comprising organizations that spent significant time in breeding,
developing, developing, cutting, pressing, saving and moving - was one of the main bunches distinguished.
Use of Glass Greenhouse Innovation heated with natural gas boosted yields. Artificial lighting, specialized
systems to manage the logistics process, climate-controlled greenhouses, mechanized growing and
harvesting technologies added to efficient, higher and green productions.

● Auction market: It gave a stage to sell and purchase blossoms so that the dealers will get the most
extreme cash and purchasers will get new quality blossoms at a sensible rate. The straightforwardness and
evading brokers improved the effectiveness of exchange without question. These key viewpoints helped
the Dutch blossom bunch to keep up its authority position.

● Transport network: Railways provided efficient transport between auctions. Netherlands had an
extensive logistical network and had invested heavily in its transportation systems, allocating 6% GDP in
2008 compared to the EU average 4.1%. Additionally, busy airports, railways and highways network,
transport facilities through rivers and canals, and Rotterdam port provided domestic and global
connectivity.

● Location: Demand from European countries was higher. Of the top ten largest importers (exhibit 5), eight
were European countries. The transportation was cheaper, faster and convenient.

● Supporting ecosystem: The Dutch developed an entire ecosystem that supported and helped boom the
industry through Growers, Suppliers, Auctions, Logistics, Transportation, Distribution, Research
organizations.

Through a solid ecosystem built around the cut flower industry as well as continuous innovation, quality - the
Dutch Flower cluster maintained its competitive advantage.
Why has flower production internationalized over the last decades and how are the flower
clusters from different countries competing?

The Dutch groups associated the bunches everywhere throughout the world through their calculated frameworks
and closeout houses. Even though they were associated, they were contending each other utilizing their own
favourable circumstances and inconveniences. The fundamental separation factor was the expense. The nations
with alluring atmosphere and less expensive work created blooms at less expensive expense than those which were
utilizing nurseries.

These bunches are internationalized in following manners:

● International sell off: International sale distributed the cost and prompt on industry for producers.
● Dissemination of creation innovation: Dutch providers began to spread the data on creation, for example,
item development, and put resources into remote creation and strategy in late 1950. 3. LTO( Land-en
Tuinbouw Organisatie Nederland )

The association gave the projects to improve the executives. Moreover, it likewise encouraged considering outings
to remote nations to advance trade among producers.

Rivalry between bloom bunches from various nations:

Merchants among various nations contended on value, advancement, calculated and in any event, bundling at the
bartering. At starting, the cost of the bloom is high, and afterward it diminished at a consistent rate. Purchasers can
choose the adequate cost and the amount they need. At last, brokers may make some modification on creation as
per the arrangement cost and volume.

● Columbia: Second largest after the Netherlands, and 25% export size that of the Dutch, growing costs
exclusive of transportation costs were half that of the Dutch because of good climate conditions, cheaper
labour. The number of farms growing and importing knowledge from the Netherlands added as a threat to
Dutch market.

● Ecuador: Primarily a rose exporter, Ecuador started taking over as a flower exporter to multiple countries
primarily US, Russia and the Netherlands. Ecuador’s export share was half that of the Columbia.

● Kenya: Cut flower industry is third largest in Kenya after Tea and Tourism. It’s share was half that of the
Columia in the flower market. These were originally Dutch growers with bulk sold to Europe via Dutch
Auctions itself.

Blossom creation internationalized in the course of the most recent couple of decades by transportation implies.
The capacity to move blossoms via air expanded the worldwide spread of blossoms created in all areas.
Additionally, the Dutch bunches help in supporting different nations added to the bloom creations development.
The Dutch group, either by their guide and additionally their closeout houses, associates the groups situated in
every aspect of the world. Be that as it may, they are for the most part serious with each other, each with their own
favorable circumstances and hindrances, the fundamental serious factor being cost. For instance Columbia has an
extraordinary atmosphere for all year blossom creation, without the need of nurseries. Thus Columbia's cost is for
the most part transportation, while the Netherlands fundamental cost is atmosphere control by methods for a
nursery.
What recommendations would you make to FloraHolland? To the Dutch government? To
major growers?

The main challenges the Dutch Flower Cluster overall must solve are primarily:

● Increasing international competition

● Withstand leadership position
● Cost efficiency
● Maintain ecosystem

Our recommendations:

● FloraHolland is a type of motivating force for utilizing their sale procedure in plans to raise their
investment rates back to where they used to be. It is a unit which combinely through help of different
growers, operates to execute auction operations in the Dutch Flower markets. It could thrive further
through
○ International expansion and facilitated trades
○ Help develop alternate markets while keeping the Dutch market primary
○ Facilitate convenient and reasonable buying so the buyers won’t contact growers directly
○ Take the advantage of European location to maintain strong position

● Dutch government We would propose proceeding with the ecological activities they are upholding to
lessen the measure of negative effect bloom creation has on nature. We would likewise suggest that the
Dutch government upgrade their control on the plant assortments they made to diminish the measure of
robbery the China group or some other bunch can pick up from.
Based on Exhibit 10 following can be focused on to increase competitiveness:
○ Logistical infrastructure
○ Soundness of banks
○ Pay and Productivity
○ Strength of Investor protection
○ Flexibility of employment

● Major cultivator / Growers is to keep making new assortments and to consistently keep the nature of
their items number one. The better the quality the less deals will decrease. Growers run the FloraHolland.
It is essential for Growers to co-operate and work together with the government to ensure following is
taken care of :
○ Reduce environmental impact
○ Spray-free zones along with drainage ditches
○ Spraying permits and inspections
○ Keeping fertilizer records
○ Use of animal manure injected into the soil than spread on the top
○ Cultivation of Organically grown bulbs

Including the three major acting forces the FloraHolland, the dutch government and the Growers - the suppliers
and research organizations also play a key role in contributing to maintaining the Dutch stronghold. It is
imperative that the forces play in harmony if the cluster must maintain its strength in the market for years to come.