Testing times for florists as revenue streams wilt
Vendors stare at big losses during usual peak season period as consumption falls due to transport constraints, virus outbreak
To lower the influence of the novel coronavirus epidemic on business, Chinese flower merchants are taking active steps to find a way out through both flower imports and exports and domestic sales while seeking to maintain a positive frame of mind during the special period.
Valentine's Day on Feb 14 is normally a "carnival" for flower sellers from China. This year though, the epidemic has suspended transport flights while keeping most people at home. This meant plunging demand and difficult times for flower vendors.
"Currently, the flower transportation capability related to the Chinese market is reduced to 10 percent of the normal level. Consumption of flowers, not like daily necessities, is greatly affected during the special period," said Guo Yanchun, the top executive of the Chinese general agent of Netherlands-headquartered flower care producer Chrysal.
"Our company majors in flower care products, which are relatively easy in stocking. We are already experiencing the influence of the epidemic. However, the influence for the fresh-cut flower enterprises is even bigger," she said.
Chen Yingxu, general manager of Beijing Jing Ke Hong Xiang Import and Export Trading Co Ltd, said the shipment of roses that were supposed to be transported to China between Feb 6 and Feb 9 are yet to be shipped due to several flight cancellations.
"We haven't calculated the loss yet. In one of our bases in Beijing, a batch of flowers which is worth nearly 70,000 yuan ($10,033) was forced to be stored. We don't know when the flower market will reopen. If the situation doesn't get better, the whole batch will be scrapped," Chen said.
In the domestic market, Dai Tangtao, a flower merchant in Southwest China's Yunnan province, said that "due to the virus outbreak, our business is not as good as that of last year. As people are all staying at home, there will be fewer consumers."
Data from the Dounan Flower Market in Yunnan, the largest fresh-cut flower market in Asia, showed that between Jan 27 and Feb 5, trade volume in the market slumped. The auction transaction volume was 431,500 yuan, which was merely 4.78 percent compared to the same period in 2019.
Currently, fresh-cut flowers from Yunnan take up 70 percent of the market share in major cities in China. It is also exported to 46 countries and regions worldwide.
"As sales during the Valentine's Day normally account for one third of that of the whole year, it is estimated that the loss of Yunnan's flower industry, including supporting industries such as logistics, during the special period will reach 3 billion yuan to 5 billion yuan," said Wang Jihua, deputy director of the Yunnan Provincial Academy of Agricultural Sciences.
He noted that the Flower Research Institute under the academy is now offering free consultation services to floriculturists in Yunnan to help them stabilize plantation and production, and resume operations when the epidemic ends.
On Feb 10, Dounan Flower Market resumed flower auctions, having been shut down for several days due to the novel coronavirus outbreak.
Wang said the reopening of the market will make up for some of the previous losses.
"Although both the number and amount of transactions declined compared to the same period last year, in the medium-to long-term, practitioners are still confident about the flower market," Wang said.
"The country is experiencing high-quality economic growth, and generally speaking, the flower industry is quite profitable. With the improvement of the epidemic prevention, consumption during special occasions such as the upcoming Women's Day, will see a resumption of growth and offset the previous losses," he said.
Although many domestic flights have been canceled, flower merchants are still fighting for chances to sell their products. Sichuan flower merchant Tang Xingjuan said some areas such as Beijing and the Xinjiang Uygur autonomous region still allow air shipments.
Given the fact that most Asian countries had restricted flights to and from China, many flower merchants in Yunnan are turning to the market in Thailand. The Ministry of Foreign Affairs said Bangkok has not yet officially banned flights and flower trading with China.
Thanks to the Belt and Road Initiative, potted flowers and some cut branches from China are being transported by high-speed rail to the Netherlands in Europe.
The upcoming 2020 Tokyo Olympic Games has likewise seen the demand for flower, flower utensils and related craft products increase as well.
Industry experts said that those international markets may ease the trade pressure to some extent, but a limited labor force during this period meant confirmed orders still face the problem of getting shipped.
The best thing to probably do is wait for the turning point when the epidemic is over, they said.
E-commerce startup florists are also thinking of a way out during this time. With Valentine's Day here, FlowerPlus, a Shanghai-based e-commerce flower platform, is using heartwarming copywriting to encourage consumption.
Its copywriting includes phrases such as: "I will run toward you with flowers as soon as I am able to." Or another line: "During the days we cannot meet each other, flowers will tell my endless yearning."
Then there is the apt and terse quip: "Flowers in, virus away."
Reflower, another internet florist, is now selling 40 carnations, which normally fetch a price of five to eight yuan each, at 39.9 yuan. A combination of five pieces of Kenya-imported Rosa rugosa Thunb and five pieces of gypsophila are now selling at 89.8 yuan, a sharp drop from the platform's previous average price.
"For flower merchants, one lesson learned from the epidemic is that they should enhance e-commerce and related digital technologies, and improve productivity, to stay prepared all the time," Wang said.
China is one of the largest markets for international flower companies. As scores of flights have been canceled, some of them are now trying marine transportation to ship flowers to China. But Chrysal's Guo said it is an utterly inadequate measure.
"For the types of flowers which require strong timeliness in shipment, such as roses, considering marine transportation is unrealistic. The flower merchants will either miss the blossom of the flower, or the special occasions, like Valentine's Day, during transportation," Guo said.
Taking the long-term perspective, though, industry practitioners are still positive.
Guo explained that "we are aware that the difficulties we are going through is only temporary. When the epidemic ends, market demand will be back to normal. Chinese consumer confidence is constantly growing, and it is for sure that people's demands for aesthetic appreciation and emotional expression will stay strong."
She noted that for now, enterprises in the industry only need to have clear plans. In the short term, business opportunities still exist as the fight against the epidemic continues and people still need spiritual inspiration and emotional expression as they do in normal life.
In the medium-to long-term, enterprises should be prepared when the situation gets better and recovery is completed.
"Maintain a positive frame of mind, stay alert and be fully prepared. I am confident that we will eventually make it through," Guo said.