
The crash of the global flower trade - evilsimon
https://www.bloomberg.com/features/2020-flower-industry-crash/
======
Cthulhu_
As an aside, I've worked at Flora Holland, the company (a cooperative owned by
a hundred and then some growers) that orchestrates a lot of the logistics; the
clip in the article with the carts is a small part of their transit halls.
They start in the early morning with the flowers and plants coming out of cold
storage and auction them off early on; before midday, the halls are quiet and
empty again, hundreds if not thousands of trucks full of carts and containers
having been filled and sent off by then. Each and every day.

Besides the actual shipping of plants etc, one of their major logistical
challenges is managing the hundreds of thousands of iron carts (pallet sized)
and millions of plastic containers (where they put the actual flowers in),
those all have codes and deposits to manage, and every day they have to
calculate how many they need. (same with how many temps they need, they can
vary the amount of people they employ by hundreds if not thousands per day.
Highest amounts are around valentine's day and mother's day).

Software-wise it's also interesting. I can't mention much about their current
day development, but one factoid is for example the auction hall itself. It's
a Dutch auction (see wikipedia), so response times is crucial. It turns out
that the exact position you're sitting in that hall already has an effect on
the response time and whether you win or lose an auction. They tried to put it
on the internet as well so the buyers could do it from home, but they couldn't
solve the latency problem (at least not to the satisfaction of the buyers).

Nowadays though, less and less is sold via the auction, and less and less
actually passes through the main venue; there's a lot more orders in advance
(like shops ordering roses a year in advance for valentine's day), and there's
a lot more direct grower-to-customer traffic.

~~~
lonelappde
Why does latency matter? In a dutch auction, latency shouldn't matter _at
all_. You can take bids in advance up to a deadline, or you can do multiple
rounds of bidding.

Google ran their IPO as a Dutch auction, and latency didn't matter.

~~~
rhplus
From Wikipedia, these markets use the “clock” variant, with the first bidder
winning:

 _“Most commonly, it means an auction in which the auctioneer begins with a
high asking price in the case of selling, and lowers it until some participant
accepts the price, or it reaches a predetermined reserve price. This has also
been called a clock auction or open-outcry descending-price auction. This type
of auction shows the advantage of speed since a sale never requires more than
one bid. It is strategically similar to a first-price sealed-bid auction.”_

IPOs are more like the sealed-bid variant.

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code4tee
It’s a tough market because there’s really no inventory. At least some produce
can be kept in storage for a little while. When the flowers are ready they
either need to be sold or they go bad.

Then of course all the “regulars” have stopped buying. In big cities like NYC
the big office buildings usually all have fresh flowers deferred weekly for
the lobby but that’s all stopped. Weddings, galas and other events are all
canceled.

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neonate
[https://archive.md/0inYa](https://archive.md/0inYa)

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GrumpyNl
Basic economics, when times goed bad, you skip the things you want and focus
on the things you need.

~~~
tonyedgecombe
It's not really economics (yet), even if peopled needed flowers they can't get
them because the store is closed.

The basic economics comes next.

~~~
elwell
> even if peopled needed flowers they can't get them because the store is
> closed

If people needed them, the store wouldn't be closed as being a non-essential
business.

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jsumrall
Anyone know where we can buy some bulk, cheap flowers here in the Netherlands
now?

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mariushn
Meanwhile in South Africa there are food issues... Why not plant vegetables
instead of flowers?

Also to note: workers get $70/mo, while all other middle-men involved get
more.

~~~
kumarvvr
I would assume that the market is self correcting.

If there was shortage of food, it's price would be up and farmers would plant
food crops.

~~~
bluGill
There isn't a shortage of food. Farmers growing food are essential and doing
what they did before. There are logistical issues. Restaurants order food
differently than grocery stores so some supply chains are overfull while
others are empty. Both are looking to the other for help but the setup makes
it in efficient

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kzrdude
It's easier to make stories about businesses than people, but I really think
we need more people stories now.

Rather than the flower trade having a downturn, what about all the people that
planned weddings? A delayed wedding is apparently hardly a disaster, but what
does it mean if nobody can get married for a half a year, what happens?

~~~
7777fps
Not much?

I think in most jurisdictions it's possible to get legally married, just not
be celebrated in the traditional way.

So wedding celebrations have been delayed by 6 months or a year, well so what?

It's such a small thing to focus on and worry about when almost the whole
global economy has been put on pause. There's almost nothing that hasn't been
affected, the inability to immediately celebrate in a traditional over-the-top
way is of such a minor consequence in comparison.

~~~
koheripbal
So what about all the weddings workers that cannot pay their mortgages now?

~~~
7777fps
I'm not saying there's no effect I'm saying that weddings aren't special in
that regard.

That's just as easily (or not!) answered the same as:

> So what about all the workers that cannot pay their mortgages now?

------
Mengkudulangsat
Cut flower export sounds like climate travesty; they are not essential, they
are fragile (requiring energy-intensive cold chain logistics and air-freight)
and after all that effort... they have a shelf-life of a week.

If there is an industry that should be strictly localized, it's this one.

~~~
tonyedgecombe
The argument I regularly hear is that there would be more energy spent heating
local greenhouses than flying the flowers.

~~~
furyg3
It’s possible to run a greenhouse with green energy. It’s not possible to do
that with jet airplanes.

~~~
pampa
Or maybe we could reexamine the need for cut flowers out of season?

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octocop
Ofcourse _Bloom_berg is reporting about this :)

~~~
LeonM
For those not getting the pun: 'bloem' (pronounced 'bloom') is the Dutch word
for flower ;)

~~~
outlace
It's a pun even without knowing any dutch, because, you know, flowers..bloom.

~~~
octocop
mic drop, bloom

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empath75
The repercussions of the global economic depression we are entering are going
to be long lasting and it’s not going to in any way bounce back in a few
months or even a few years. A lot of industries are going to completely
collapse.

~~~
chewz
And a lot of new industries will arise. They already do.

~~~
kuu
Out of curiosity, can you mention a few you consider are raising?

~~~
chewz
E-commerce is booming, courier services are hiring, small mom and pop local
retail is quickly embracing internet orders. In my country we are introducing
parcelmats at scale and preparing for 'foodmats' or 'fridgemats'.

In general replacing cheap labor with automatisation to avoid human contact
will be a thing. Retail, restaurants will look more like in Japan.

Local tourism seems like a sure bet as people probably won't trust claims
there is no virus in places like Bali or Thailand. No to mention there will be
no cheap flights for years to come.

All the WFH will be a huge opportunity for real-estate and construction very
soon as people will start leaving dense urban areas.

Some countries in EU will reform farming and bring strategic production back
home which will be huge kick to economy. And there will be unlimited funding
for that a'la Marshall plan and Eisenhover era.

Local restaurants, florists, barbers, waiters - collateral damage.

