Others may think the flower business is an easy one, but for those who take this business seriously, they invest heavily not just on modern equipment and technology, but most of all they keep the business up close and personal.
Dustin Andaya, CEO of Island Rose, the brand name and the e-commerce platform of the family-owned Philippine Cut Flower Corp. and the country’s most viable flower plantation located in the cool climate of Tagaytay, says his flower delivery business promotes good-relationships and could help mend broken ones.
“We keep relationships alive,” says Dustin.
Philippine Cut Flower Corporation (PCFC) literally invented the Philippine cut flower industry when it started the first full scale rose production in 1983 and petitioned for pioneer status. Today, the industry has been joined by other growers and has been recognized as an independent contributor to the Philippine economy.
PCFC is the largest retailer and wholesaler of roses in the country. From its five-hectare flower bed in Tagaytay, Island Rose specializes in growing popular Dutch and French variety flowers using state-of-the art greenhouse facilities. The company used to be an exporter of roses to Japan, Hong Kong, and Guam but it had seen the strong local demand and found it more rewarding than the exports market.
The company had decided to stop exporting and redirect its business to the local market. The idea was to deliver flowers to customers direct from the farm.
Fresh flowers in dainty boxes get to their destination on the same day within Metro Manila and overnight deliveries outside of Manila.
To bankroll its modernization program, the company took out loans in 2004 which they have fully paid already.
Today, Island Rose supplies up to 50 percent of the market for roses. The rest is being served by other producers and backyard garden production keeping imports at bay.
It’s busiest months are from February to May where company sales normally grow three times more than the ordinary months. Christmas also delivers huge sales.
“With huge sales, we have to move faster,” says Dustin.
Their flowers are delivered to over 7, 000 islands.
“We have nationwide coverage,” says Dustin.
Flower packages start with the most affordable price of P495 but the delivery and packaging components account for the bulk of the cost of every boxed flower. Flowers should last for a week.
Business is good. This year alone the company expects 19-22 percent increase in sales.
Although Island Rose is already the country’s most modern and profitable rose flower business in the country, Dustin maintains they are still a small company.
“Within the industry, we could be the largest but as a company we are still small,” says Dustin. The industry has remained a largely mom and pop operation, but Island Rose has already bulit a bigger base corporte clients.
The company has also increased the variety of flowers and added other gifts to accompany the flowers.
They recently acquired Express Regalo, an online gift shop – ‘Regalo’ means gift in Filipino – and have also bought Bruges, a Belgian chocolate factory in the Philippines.
When the young Dustin came on board, he revolutionized the family business.
He initially partnered with the Manila Bulletin’s online edition to market his flowers. Then with a P 50,000 capital, Dustin was able to put up an online portal.
Dustin’s online marketing strategy has paid off.
From an 80 percent export market and only 20 percent for the local retail market, Dustin has been able to reverse the situation. Now, their business transaction is mostly domestic and 80 percent of its total business transaction is online making Island Rose the first e-commerce company serving clients nationwide.
“We did not buy trucks but we have couriers,” says Dustin.
The company beefed up its operations further by tapping the world’s largest cloud-based solutions provider NetSuite starting in 2010 making its operations highly automated, efficient and effective. All transactions are made online, including payments.
The company used to ship its flowers through a particular courier but it has now tapped all logistics firms to deliver flowers to all parts in the country.
At first, the company was targeting the OFW market to send flowers to their loved ones back home. Since then Dustin has seen tremendous market expansion.
It could be expensive to send flowers but Island Rose has been able to price their products cheaper because they have eliminated the middle men in the process.
Dustin recalled that his father was not that convinced about the online business, but revenues have been coming in through that business segment.
“By 2004, it was the biggest revenue contributor to our business already,” says Dustin, who used Island Rose for his MBA thesis at the University of Bath in UK.
Dustin was supposed to study at the London School of Economics but his funds got hit by the financial crisis in 1997 thus, forcing him to go to a more affordable school but still in UK.
But studying in Bath proved to be good for the young Dustin.
“The university of Bath is an equally good school and Bath is very beautiful,” gushes Dustin. His stay in Bath also allowed him the chance to go around the country side on weekends.
“We’re looking at the future so we continue to upgrade,” says Dustin.
The company undertook a modernization program in 2006 to replace the old farm. It has invested in its own R & D division.
Island Rose has adopted a new greenhouse technology from a Dutch technology firm to improve its flower production without increasing its footprint.
They have now six greenhouses built on a 2-hecatre lot out of its 5.5-hectare farm producing 2 million long stemmed cut flowers a year. Other ordinary flower farms use 10 to 20 hectares of land to produce one million flowers. Island Rose produces 12 varieties of roses and 8 colors.
“Some flower farms in Benguet cover an entire mountain to produce as much flowers,” says Dustin.
Its plantlings are also imported from the Netherlands but grown at its Tagaytay farm. The young plants are grown 35 to 45 days before harverst. They are replaced every five or six years.
“We are very productive,” says Dustin. While the technology is expensive, Dustin says, it pays because it ensures higher productivity. The Dutch technology, which they started using since 1983, adjusts to the weather conditions automatically.
The greenhouses operate under controlled temperature at 26 degrees during the day and 10 degrees at night. The system is fully automated including the irrigation and is thus water efficient.
“Plants are not like people, they don’t eat three times a week, but they need stable environment so we feed them by the droplets,” says Dustin.
“It is very environment friendly. The only manual operation is harvesting,” says Dustin.
His only problem though is the high cost of electricity. Because everything is computerized and automated, electricity cost runs high. Dustin pays as much as P 100,000 a month in electric bills.
Island Rose was originally established as a side business of Dustin’s father.
“I’ve grown to like it,” says Dustin, who was only 30 when he joined the company. His major contribution in the business is his introduction of the company to the world of internet that transformed the company into the modern way of doing business, the e-commerce platform.
The company has also played important role in the successful marriages of some Filipinas and their foreigner husbands.
“Our business is very personal. It is less of a product, but more of a service and very personal at that,” says the 43-year-old Dustin, who loves riding his big bike on his spare time.
“Without going online, we probably not made it,” says Dustin noting that the cost was really staggering but the figures look good overtime.
Dustin attributed his success to his stubbornness. When he was told against going online, he became more obstinate to pursue it.
“I was just stubborn. I think stubborn equals persistence,” adds Dustin.
According to Dustin, the potentials of the flower industry are yet to be fully tapped.
“In the Philippines, giving flowers has always been associated with romantic gestures, but in the US and in other countries it is a tradition that is why the US market for flowers is huge,” says Dustin. It is not the orientation in this country although the tropical climate could also be one reason giving flowers has not blossomed as a tradition.
“Giving flowers can mend relationships,” says Dustin. Because of this very personal undertones in the act of giving flowers, Island Rose has committed to ensure customer satisfaction.
To reflect that deeper understanding of its role, Island Rose also has changed its corporate tagline to “Keeping relationships alive”.
“From that time on that we changed our company tagline, everything and everyone in the company just changed to adopt a mindset that promotes good and nurturing harmonious relationship,” says Dustin. It makes it so fulfilling on their part to serve as the tool to achieve and improve relations.
“No rude attitude is tolerated in the company. We can afford to lose money from our end but not on the part of the customers,” adds Dustin. Island Rose people are also trained on how to handle complaints.
“If anything goes wrong, no question ask we replace immediately, our people do not need to get any approval,” says Dustin.
The company also upholds the confidentiality of their clients and private messages are kept confidential. Its system has provided no access and not time for a staff to even look at who the sender is. This is to ensure the service maintains that personal touch is not lost among the hands that prepare the flowers.
“You can even personally pick the flowers,” says Dustin.
“You have lots of choices and hundreds of combinations. We mass produce flowers, but we also customize our products,” says Dustin.
So, for the things that are rather left unsaid, for things that are better left unanswered, say it flowers. It can do wonders.