Persistent pressure towards increased economies of scale will result in a decrease in the number of growers in The Netherlands by at least another 25 percent in the coming eight years. That is the assessment the ING Bank’s Economics Bureau has just circulated.
The forecast of a 25% decline is provided in a thematic study of the sales prospects of the ornamental horticulture industry, which the Dutch bank has undertaken. One of its key conclusions is that the characteristic ‘funnel structure’ of the horticulture chain will likely break down by 2020: information exchange is too limited and feedback from consumers doesn’t reach the traders, let alone the growers.
As it currently stands, growers are rapidly approaching the limits when it comes to productivity increases and sustainable cost ratios already. That lack of leeway is forcing them to look for new business models and product combinations, the ING Bank observes. A growing number of producers bypass the auction clocks, for example, particularly when it comes to plants.
The downward trend in the number of operational floriculture businesses will therefore most likely continue, until at least the year 2020. The estimate of a decrease in the number of independent Dutch growers by at least 25 percent is, in fact, characterized as a cautious assessment by the bank. The figure may well turn out higher than that.
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