First published in AMS business magazine. Author: Sarah Gehrke

Lucas Vos is in trouble with his neighbours. As CEO of Royal FloraHolland, he is given a lot of flowers: ‘Every week, my florist comes in and brings three new bouquets, and whenever I go to a grower, I get another bouquet,’ he says. His solution? ‘I give some to my neighbours. The women like me, but all the men hate me because I keep bringing their wives flowers,’ he laughs. Apart from this slight hiccup in neighbourly relations, the floriculture industry is treating Vos well. He came to Royal FloraHolland in 2014 after a five-year stint as CCO at container-shipping conglomerate Maersk in Copenhagen. When he decided to return to the Netherlands, he says, ‘I really wanted to do something…Dutch. And well, I couldn’t get more Dutch than this!’ But there’s more than just the ‘Dutchness’ that fascinates Vos. It’s also that the Netherlands is at the heart of floriculture: ‘The Dutch basically control every facet of this industry, from breeding and growing through the education sector to financing and trade.’

Royal FloraHolland is the glue that holds it all together. The cooperative is owned by 4,500 primarily Dutch growers, and is an international frontrunner in the floriculture industry. With several sites in the Amsterdam Metropolitan Area and in Zuid-Holland, it’s a main hub. The auction sites and the greenhouses, where the flowers are grown, are geographically close – and the customers are nearby, too. With the Netherlands, Germany, France and the UK as his main European markets, Vos says, ‘This is the best logistical set-up you can have. It’s all concentrated in one place. We’re right in the middle of those three main countries, so it’s just perfect.’ 

But these days, things can get more complicated. Flowers are being produced in Kenya and Ethiopia, and customers are not only in Western and Central Europe, but in Russia and China, too. Nevertheless, the flowers are often shipped through the Netherlands, says Vos. ‘Since we have the cooling chain so well under control, even our Russian customers tell us that if they fly flowers directly into Moscow, the quality is not as good as when they go to Schiphol Airport and transship via our marketplace before trucking them over to Moscow.’ After all, it’s the Dutch airlines, KLM and Martinair, that have the expertise in transporting flowers. Furthermore, Dutch growers offer much more variety. ‘You know, Kenya and Ethiopia only offer roses. And every little florist or retail outlet wants to have roses and tulips and chrysanthemums and orchids… so at some place, these big mono flows need to be divided up. And you might as well do that here.’ 

Green moves

With an expanding base of producers and markets, Vos’s background in logistics is certainly helpful in his job at Royal FloraHolland. But he puts it to good use in another role, too. As a member of the Amsterdam Economic Board, he is spearheading a challenge that has been formulated as part of the Amsterdam Sustainability Agenda. ‘By 2025, we want to make the Amsterdam Metropolitan Area CO2-neutral when it comes to the transportation of goods. We’re now trying to form a coalition under the header of the Amsterdam Economic Board and I’m leading that – primarily because I have a background in shipping and I have a vested interest because of the flower cluster, but also because we have Schiphol Airport here, and we have the Port of Rotterdam, the biggest port in Europe, in our neighbourhood.’

While he admits that there is still a lot of work to be done, the outlook is bright. ‘I think the biggest achievement is that the City of Amsterdam has set this ambition and, so far, I’ve only heard people support it, whether they are in government, in business or in education. Everybody’s mobilising behind this target, and that’s great. I really feel a big drive, that people want this, they want to have Amsterdam as a model city in that respect. It’s not being pushed – there’s a pool of private companies that want to make this happen.’

An attractive purchase

At Royal FloraHolland, Vos envisions some changes, too. ‘I think the biggest thing that we’re looking at right now is that a large chunk of the process – the purchase moment, the auctioning moment – is still connected to the physical move.’  Which means that the flowers are transported from the growers to an auction site, where they are then sold and need to be transported again, sometimes to a location near to where they came from. ‘There is some waste in that process. There’s a lot of traffic on the A4 (the highway between The Hague and Amsterdam) that is related to flowers. At certain moments, it’s 40% of the total cargo on the A4. Sometimes, that’s a waste we could have avoided. This is one of the developments that we’re working on, to see if we can take that cost out. That would mean tremendous savings. We could auction the flowers while they are still on the premises of the grower; then we know to whom they’ve been sold and can bring them directly to that customer.’

Currently, just under 50% of flowers sold through Royal FloraHolland are still auctioned (the rest is traded directly between growers and customers, with Royal FloraHolland taking care of the financial transactions.) The auctions are traditional Dutch auctions, which work the other way round from regular ones: prices are displayed on 38 so-called clocks, starting at the highest price and then going down, and buyers wait until the clock has reached a price they feel is right. The biggest customers even have their own dealing rooms with clocks onsite. Vos says between 30% and 40% of the customers buying flowers in the auction are still present at the site, ‘sitting in the benches here’. It’s a true spectacle: huge spaces are filled with flowers waiting to be sold. Despite the auctions taking place early in the morning, at 06:00, they are even a tourist attraction.

But online trading is increasing, with people partaking in the auctions from elsewhere in the world. Will that go further? ‘I think it will,’ says Vos, ‘and that’s what we’re looking at. Our current customers are also asking for that, because they say they can’t get people to get out of bed at 04:00 to drive to the auction site. So, yes, that is a tendency that we see happening and we need to facilitate that.’

While it’s necessary progress, a nostalgic could get a little teary eyed about the eventual demise of the flower auctions and the associated buzz. Is Vos a romantic when it comes to that? ‘Well, you can’t help being a romantic when you see all of this,’ he admits. ‘There’s so much pride in it, and every time we have visitors here they are just amazed by the size of the operation. The site where I’m sitting right now is bigger than Monaco – it’s a huge operation. And it’s also a fascinating combination. Yes, it’s stone-cold logistics, but you handle products that are so delicate, and so tuned in to human emotions. There is no other product that can handle all the emotions. You know – you wouldn’t bring a bottle of wine to a funeral, let’s say. Flowers can deal with every emotion.’  Would he say flowers have a special place in Dutch society? ‘Absolutely. I think they’re part of our DNA. Like Heineken, the Rijksmuseum, Rembrandt… Dutch flowers, in particular tulips, are iconic for us.’