Whenever a foreigner comes to Brazil and asks a Brazilian grower whether he’s considered exporting, the grower usually responds with little more than a concerned look. Why would you want to export, when you’ve got access to a 200-million people domestic market. Why would you want to export, when you’re growing in a country with 700 supermarket chains, only a few of which have started selling plants and flowers?
Yes, I did ask the Brazilian growers whether they were interested in exporting to other countries. Not such a strange question considering that Holambra is only a 2-hour drive away from the airport in Sao Paulo. Why not export flowers to North America?
Furthermore: about ten years ago, growers set up companies in the north of Brazil, in Ceara, with the aim of growing flowers for exports, to Europe for example. Unfortunately, Martinair was no longer allowed to fly to Forteleza. I’ll spare you the details of the exact reason for this hiccup. But all in all, my question really wasn’t that stupid.
Two aspects that are getting in the way of exports are the bureaucracy and the lack of good cooling facilities at Sao Paulo airport. But Brazilian floriculturists don’t need more than their domestic market either. Because it’s immense. More than 200 million people. Many of those people have no money to buy a bunch of flowers or a plant, though.
But the crisis of 2013-2015 had no real impact on plant sales. That’s because the growers started selling through supermarkets. With support from the auction, which acquires customers at the annual retail trade fair and comes up with concepts.
Growers agree that the retail channel has allowed them to expand their distribution market. The relatively low supermarket prices meant that plants became affordable for ordinary people. Growers are happy to supply for promotional prices and introduce their products to new consumers. The potential of the supermarket segment seems unlimited here. I was told that there are no less than 700 supermarket chains in Brazil.
The crisis did have an impact on flower sales, though. Fewer events meant a decrease in sales. Quite a few florists didn’t survive this period. Also because retailers were taking over a large part of the plant sales. Florists couldn’t exist on flower sales alone. And what about flower sales through retailers? The Cooperflora cooperative has been supplying flowers to supermarkets for a while, and Veiling Holambra is currently also very focussed on developing this market.
On Friday, auction director André van Kruijssen, Jerry van der Spek and Jim Duijvesteijn took me on a tour along seven supermarkets. Jim is doing an internship in Holambra, with Rosas Flamingo, where he’s working on a project for Viva Flora. Jim’s father has nurseries in Honselersdijk and Ghana.
Jerry worked for Dekker Chrysanten for many years and started his own online flower shop, Flores4all, in 2011. He quickly realised that logistics are a huge challenge in Brazil. He shifted his focus to business-to-business and found a cargo company. Four and a half years later, someone asked for four trolleys of orchids and Jerry delivered them in the same time as he normally needed to deliver a bouquet. Wouldn’t it be better to focus on the wholesale trade?
Wholesalers are now placing all their orders for his company ADFonline through an online platform, developed by software company Match-Online. ADFonline’s platform is directly linked to the Veiling Online platform, which was developed by the Brazilian branch of Match-Online, led by Appie Haveman. The auction has a majority share in the company. Jerry also buys for some of his supermarket customers through Veiling Online, with ADFonline functioning as logistics operator. His customer base includes eight chains, with a total of fifty to seventy shops.
He tries to make things as easy as possible for his customers, so apart from managing their purchasing, invoicing and logistics activities and providing them with purchase proposals, he also assists with shelf management.
For example in the form of training sessions for shop floor workers. But also by advising about the type of products that would suit each individual store, based on the type and number of consumers they attract. He works together with his customers to determine the best way to fill the shelves and achieve the highest turnover.
One of the key elements in all this, is the auction’s cut flower project for supermarkets: Poetica flor. “If supermarkets can work with preferred suppliers, ensure proper pretreatment with floral food products, and keep a close eye on chain temperature, they offer plenty of opportunities for the cut flower segment”, said Jerry.
During our visits to the seven supermarkets, we noticed a huge variety in quality of all the different plant and flower sections. Especially Jerry, our shop presentation specialist. We spotted good things and bad things.
But overall, I’d say there still a lot to improve. Does that mean it’s all bad? No, of course not. Lots of progress has been made already. In many places, we were met by a colourful sea of plants and flowers immediately upon entering the supermarket. They were mostly placed at the entrance, on the right side.
Jerry said that that’s exactly how the shop-presentation bible stipulates it. Another plus is when the plants and flowers are presented on multi-level displays. And even more points are scored when there’s an employee who’s responsible for the floral segment, who checks it every day, refreshes the produce on offer and waters the plants. We got to see a few examples where this was in place.
But not everywhere. The last supermarket that we visited still had the roses for International Women’s Day on display. The individually wrapped roses were completely dried out. Not something any woman would still want to receive. It was clear in several supermarkets, that the Brazilians don’t like throwing things away. Too bad. And regarding presentation, the plants weren’t always presented on multi-level displays, sometimes they were simply put on shelves. As a result, the tops of some of the kalanchoe plants were crushed by the shelf above.
Plenty of challenges for Jerry to work on. With ADFonline, he visits the stores on a regular basis and he also tries to improve things by visits to supermarkets in Holland or by attracting specialists to Brazil. But just like in the Netherlands, the Brazilian retailers still have a long way to go. The fact that there is someone to assist them is great. The truth is that the supermarket has already proven to be an important distribution channel for plants and flowers. It was the retail segment after all, which helped many plant growers through the recession here.
As for exports? A few last words. KLM is going to fly to Forteleza. Does that mean we’re going to see Brazilian flowers on the European market or shipped to the USA and Canada after all? No, probably not. Growers feel that the competition from Africa (cheaper) and Ecuador and Colombia (larger flowers) is too big.
I did hear a different idea about exports, though. It concerned the export of plants. I heard a grower say that he’s looking into exporting his plants to Argentina and Uruguay. But my guess is that that won’t happen overnight either. As I mentioned earlier, Brazil is quite a bureaucratic country, which means that even exporting to neighbouring countries isn’t a piece of cake.
Arie-Frans Middelburg
