Growing consumer interest in products that are green, local and sustainable, along with the increasing popularity of farmers’ markets, points toward systemic growth for the flower segment, but major obstacles remain.
Organic flowers currently account for only a fraction of the overall cut-flower market, valued at $6.6 billion in 2010 by IBISWorld. The category suffers from both supply limitations and often unattractive price premiums. Most of the farmers who produce organic only dedicate an average of three acres to flowers. With virtually no organic wholesale operations, growers are primarily limited to direct selling through community-supported agriculture (CSAs), farmers’ markets and the natural retail channel. Nevertheless, the segment delivered solid 3% growth on sales of $67 million in 2010, according to NBJ research. With sales up $2 million for that year, the growth of organic is well above the 1% increase for its conventional counterpart. The Perishables Group reports that total floral department sales in the mass channel averaged $3,068 per store per week over the past 52 weeks, up 1.2% from year ago levels.
The organic flower market today is a lot like organic foods in the ‘90s, according to Marc Kessler, owner of CaliforniaOrganicFlowers.com, a national online seller of organic flowers. “Back then, if you were lucky,” says Kessler, “there was one co-op in each town with a tiny cooler of sad-looking vegetables. Retailers wondered why no one was growing organic, and growers said there was not enough demand. Organic flowers are stuck in that loop today.” We know where organic foods ended up, he adds, so the question becomes: Will organic flowers spend 20 years caught in the loop?
Melissa Feveyear, owner of Terra Bella Flowers in Seattle, is one retail florist who has had to scale back on her original proposition of year-round organic flowers due to the inconsistency of supply. “Four or five years ago, there were a bunch of factory farms and large flower producers who started growing USDA certified flowers,” she says. “But when the economy slowed and people started pinching pennies, many of these growers stopped with organic, saying there was not enough demand and that the cost to certify was too high.”
As a result, Feveyear moved toward supporting local growers who are not USDA certified but use organic practices. “Our clients know that our products are grown consciously and locally,” she says, “and that seems to be the big key for them, not organic, although that can be a plus.” Feveyear says that, while she can’t call some of her flowers organic, she can capitalize on the same concepts that have made farmers’ markets so popular—a desire to support smaller, independent farmers and suppliers.
Such a model can work for small businesses, like Terra Bella, which serve as gatekeepers and offer transparency to their customers. However, the industry is predominantly built on flowers coming from farms in Ecuador and Colombia to large U.S. wholesalers. Many of these flowers now tout new “sustainably grown” certifications, such as Veriflora and Eco Flora, which leads inexorably to consumer confusion.
Customers who want truly organic flowers may have to request certified organic to get them, even from seemingly dedicated organic sellers, Feveyear says. In speaking about the organic certification process, Kessler notes: “You know it is strictly managed with legal requirements, penalties and inspections. There is no legal definition for sustainable, so anyone can make it up and call it sustainable. Even if their heart is in the right place, and they are doing their best, it’s confusing.”
Kessler, who has been in business since 1995 and started with a dedicated organic product online in 2005, gets around the entire problem by controlling his own supply chain from seed to vase. “Our solution is to grow all of our own flowers, so we are assured of our supply,” he says. “But we don’t offer the same flowers year round. It’s seasonal, just like with vegetables.” The company has to jump through all the necessary hoops to remain certified, he notes, keeping complete harvest records and tracking a bouquet’s entire history from harvest to shipping. “It is not easy, but it has also made us a more efficient, better business.”
Certified or not, there are still big questions about consumers’ commitment to organic beyond food items. According to Lynn Byczynski, editor and publisher of Growing For Market, a national magazine for market farmers, and author of The Flower Farmer: An Organic Grower’s Guide to Raising and Selling Cut Flowers, having a certified organic label on flowers does provide a marketing edge, but little else. “People love the idea of organic cut flowers, but I can’t say they feel the need to pay more for them,” she says. “Prices have to be competitive with conventionally grown and local markets.”
There is really only a small niche of consumers who will buy organic flowers because they are better for the planet, according to Kessler. “I don’t think we can build a strong market on that,” he says. “I think the real breakthrough will come when growers are creative enough to offer unique varieties and extraordinary quality. If you look back, organic food didn’t break out until it became associated with better taste and quality.” Fragrance, he adds, is a good place to start. Few conventionally grown flowers currently have much fragrance at all.
Feveyear is also taking steps to control supply by working with local Washington growers to create the Seattle Wholesale Growers Market, set to open in April and sell to the floral trade. The proposition sounds like a good one to Kessler, who says farmers are traditionally not good at selling and don’t have the time to spend away from their fields. Byczynski believes that these recent developments will improve the market. “People now are lots better educated about the value of organic production,” she says. “Cut flowers can be a very profitable niche for growers. If the ultimate goal is sustainable organic farms, flowers will be a real help as a category to those farmers.”