Standardise and collaborate
The second edition of Flower Logistics Africa and the maiden edition of Perishable Logistics Africa, held recently at the Kenyan capital city, brought Africa's key exporters to discuss the role of logistics in finding the right market and price for one of Africa's key exports. The deliberations at the two events called for stricter standardisation across the logistics value chain and greater collaboration within the industry.
Renjini Liza Varghese
Kenya is one of the key exporters of flower and perishables in the world. While the country exports over 200,000 tonnes of flowers per annum to 60 international destinations, perishables also command a similar market share. For the last two years flower and perishable export growth has been hit owing to different factors.
The flower segment, according to Kenya Flower Council (KFC), however is growing at 2 percent, which KFC thinks will improve soon.
While Europe continues to be the key market, Kenyan growers are looking beyond Europe as the demand started surging from the East. So it is a ‘look East’ policy adopted by the Kenyan growers especially with increasing demand from China. The changing paradigms like the entry of e-commerce players are expected to drive the flower and perishable markets in the coming years.
The flower and perishable segments face challenges that include, lack of standardisation in packaging, the high cost of transportation, non-collaboration among the stake holders and how to maintain the right temperature etc.
Jane Ngige, chief executive officer of KFC pointed out, “Farmers are no longer farmers; they have grown to become global business people. So they got to face global business challenges, which will include logistics, investments and so on and so forth. They no longer can sit back and grow flowers or perishables and deliver it to the airports.”
The second edition of Flower Logistics Africa 2017 which revolved around the core theme of “Enhancing Africa’s flower power through better logistics,” and the first edition of Perishable Logistics Africa 2017, with the main topic, 'Creating Africa's future logistics grid for perishables' has facilitated the perfect platform for deliberation on the above-said points. The two conferences organised by the Logistics Africa Update magazine by STAT Media Group discussed in detail the roadblocks and challenges of Kenya’s flower and perishable trade segments.
Packaging plays a crucial role in retaining the freshness and quality of flowers and perishables in transit. There are 300 different types of packaging boxes available in Kenya alone. This, the industry players feel, is of no help and is creating more confusion. Delegates at the conference were in agreement when there was a call for standardisation of packing boxes and industry collaboration. Standardisation also means bringing in consistency.
A cross-section of the shippers highlighted that the higher number of players in packaging segment has resulted in decline in the quality of the product. "More players have spoilt the quality of packaging boxes in Kenya and making the packaging process a challenge," commented Eliud Njenga, director, Credible Blooms and Pigeon Blooms.
While quality stands as the first priority, consistency is another issue which is being pointed out by shippers. "As a sector, we all need to speak the same language for inconsistency. As stakeholders, it is our responsibility to ensure standards are maintained," said Eddy Verbeek, general manager, Florensis, a Netherlands based breeder and plant supplier.
Parit Shah, director, Silpack Industries, elaborated on what is being implemented by saying, "We are raising standards by avoiding previous mistakes in all matters regarding packaging. This is to provide consistency from suppliers to ensure delivery is of standard.”
More than the industry imposing rules on standardisation, Shah stressed upon self-regulation. He added, “There is need for suppliers to have self regulated internal standards to ensure ownership within the industry.”
Jeroen van der Hulst, director, FlowerWatch, draws the attention of the stakeholders towards the importance of adapting successful innovations that are being used by the global peers. He said, "Standards means investing more on coaching the workers at the farms and the processing process. We need to borrow from our partners by incorporating innovation in our processes."
Like the right packaging, maintaining the appropriate temperature is also crucial while transporting cargo across the continent.
The shipper is the best judge of his cargo and the condition of its transportation. He can judge what temperature to is be maintained, the size of the box etc. However, there seems to be a gap in communication.
“There is a disconnect between the shipper and the carriers, and there is a need for a conversation to solve it,” said Conrad Archer, managing director, Panalpina Africa.
Delegates at the conference were of the unanimous opinion that there is urgent need for industry collaboration. However, the question remains, who will take the lead?
The government, participants thought, should take the lead as policy formation is key to the growth of any segment. However, the industry feels that the associations of the value chain seem to be the perfect fit for the job. So going forward, if the associations are successful in joining hands, majority of the challenges will have an answer within the industry itself.