Move gives flowers more power

Bruce O'Brien says retailers will get better access to supply.

A new flower industry joint venture hopes to cut costs and grow the market.

United Flower Growers, which starts trading next month, is a joint venture between the majority grower owned firms United Flower Auction (UFA) and produce wholesaler Market Gardeners.

Bruce O'Brien, managing director of both UFA and the new company, said it was a win-win situation.

"For the retailers they're going to have a heck of a lot easier access to product uniformity and for growers a better form of distribution which will mean they're going to be introduced to new markets at a reduced cost," he said.

The new company would manage about 40 per cent of a domestic flower market estimated to be worth about $50 million in total.

United Flower Auction would bring together the Auckland auction and trading operations of UFA and auctions in Wellington, Nelson, Invercargill and a brokerage operation in Dunedin belonging to Market Gardeners.

"We're looking at orderly marketing," O'Brien said. "It's not about price competition or anything like that it's about trying to make people market their product better."

About 80 per cent of flowers were grown in the Auckland region, which under the new joint venture could be forwarded to localised branches rather than potentially having to be sent to individual small florists.

O'Brien said flower retailers would get a better access to supply of product throughout the country than what was now available.

The morale of producers was low, with little way to recover rising costs because they did not dictate the sales price, he said.

"We've said for a long time, for the last couple of years, that the flower industry in New Zealand needs something to happen to make it be able to evolve to something better than what it is," he said. "We believe we have thrown a rock into the pond and this may just be the thing to make everybody sit up and change their ideas and inject a little bit of life into the marketing."

Market Gardeners chief executive Tom Treacy said the new company provided opportunities for consolidation and growth in the national flower market.

"There are clear advantages in merging our respective operations in terms of the logistical efficiencies and business synergies available," Treacy said. "This move will support a joint commitment to delivering top value and service at auction and to the wholesale trade."