of Bio-industrial Mechatronics Engineering, National Chung Hsing
University, 250 Kuokuang Road, Taichung, 40227 Taiwan
phone: 886-4-22857562; fax:886-4-22857135
is known as the top house plant sold in the world. In recent years, due
to the decrease of price in the market, the recognition of the potted
Phalaenopsis was changed from miracle crop to a thin or even no
profit crops. More than half of the Phalaenopsis production is
from the Netherlands, so the industry in this country was selected as a
case study. As a main objective of this study, the fundamental issue in
the Phalaenopsis industry of the Netherlands was investigated and
reported. The demand and supply information were collected from
literature and personal communication with orchids companies. With
respect of this idea, the traditional and
the new production schedule of
Phalaenopsis pot plant were discussed. The change of sale prices
were reported in monthly units. The
uneven demand such as higher requirements during some festivals
and very lower requirements in the summer was considered as the main
reason for the dramatic change of sale prices.
The estimated demand for
Phalaenopsis pot plants in the market was also discussed. The major
finding of this study indicated that the uneven requirement of flowers
in the market and the constant supply of potted plants from flower
companies were the essential problems for the Phalaenopsis
industry. Therefore, this approach fails to achieve a balance between
supply and demand. In order to operate sustainably an orchid production
company, it was necessary to adjust the supply of Phalaenopsis
pot plants for each week. The potential contribution of this finding was
to propose the available methods to alleviate these problems. The
available methods included to adjust the supply quantities of plantlets
for plantlets nurseries and to modify their supply time to market with
the environmental control and cultivation management by orchids
companies. The experience of the development of Phalaenopsis
industry was a lesson for the emerging flower industry.
The Netherlands; production process; monthly demand
due to its exotic, stylish, unique shapes and long-term durability,
become the top house plant sold in the Netherlands. Thus,
was recognized as the most produced and traded houseplant in The
Netherlands and nearly 25% of the value of exported plants was realized
by this product group. The Dutch
cluster has experienced enormous growth since the year 2000. The
seemed to grow from around 8 million flowering
approximately 150 million plants in 2015 . Hence, the Dutch
was considered as the global market leader in terms of the production of
plants . The Netherlands is the worlds’ biggest producers and
and 90 % of the sold in Europe is from the Netherlands [1-3]. The
industry in this country was selected as a case study.
known that 2003 to 2007 was the best period in Europe for the
Phalaenopsis industry. The supply was increased enormously each
year. However, the sale price was stabilized. The Phalaenopsis
plants are considered a miracle crop in the flower industry, and the
industry has developed rapidly in recent years. The key point of this
industry is believed to be the constant supply of Phalaenopsis potted
plants through the years .
turnover was estimated was around 494 million EUR and the sold units was
137 million in 2016 . It occupied more than 83% of all orchids
cultivated in the Netherlander. Almost 90% of the Phalaenopsis
sold in Europe was from this country .
growth of the Dutch
was mainly caused by technical developments, the Dutch horticultural
supply chain and the strong home-market. The
culture and cooling techniques augmented the accessibility of the
Subsequently, growth was boosted by the presence of multiple sales
possibilities and a large and strong home-market.
Subsequently, a decreased growth in the Dutch home-market around 2010
intensified internationalization of the Dutch breeders and propagators.
With the start of heavy competition with the overseas markets, this has
Phalaenopsis in the Netherlands industry was found to be under
extreme pressure .
to help the growers to cultivate the orchid of good quality, some
excellent culture guides have been published. Two nursery companies such
as Anthura and Floriculture b.v. published their famous guides [4-6]. A
significant reports was introduced by American Orchids Society [7-10].
Venamy Orchids company supplied a detailed comprehensive guide in their
web-site . The study of the physiology of Phalaenopsis and
practical culture techniques were reported in various scientific
not too much of the reports concerned of the Phalaenopsis
industry. Griesbach  proposed that the Phalaenopsis orchids
would be promoted as an industry and shared on international market.
Hsiao et al.  has suggested to promote a country brand label for the
orchids products in the international markets. Krause et al.  has
identified the value chain of potted Phalaenopsis for two
countries, i.e., Germany and the Netherlands and proposed the importance
of the business-to-business quality management systems in this value
chain. Grosscurt  studied the topic of the rise of the Dutch
Phalaenopsis cluster and found that the important factors such as
the business environment, cluster size, knowledge and innovation and the
marketing & strategy could play a crucial role on the global market
leadership of the Phalaenopsis clusters were.
potted Phalaenopsis market is presented in Figure 1. In 2000,
only 8 million plants were produced. The maximum production was
estimated 121 million in 2014. The trend of turnover was quite similar
to the quantities is shown in Figure 1.
The trends of the turnover and quantities of the potted Phalaenopsis
in the market of the Netherlands. Data sources are Knijff and Splinter
, Middelkoop [22,24,26] and FloraHolland .
change of the average sale price is shown in Figure 2. Previous to 2009,
the average sale price was found to be higher than 4.0EUR and the
production cost per unit was found to be lower than 4.0 EUR for 10 years
[21-24]. It was stated that with the increase of supply, the sale price
was still remained stable. That was the reason that the orchid was
called as the miracle crops. Actually, the lowest price was observed in
2009 and this price never increased more than 4.0 EUR since 2009
The change of the average price of the potted Phalaenopsis in the
market of the Netherlands. Data source are Knijff and Splinter ,
Middelkoop [22,24,26] and FloraHolland .
recent years, the Phalaenopsis industry in the Netherlands
encountered serious problems and the sale price was decreased
continuously. With the report of Dutch Phalaenopsis industry
under extreme pressure , author interviewed many nurseries and
orchids companies in this orchids industry. They found that growers
would to rent their space to other industries or they no longer wanted
to fill the space of the greenhouse. The observed general trend was to
sell this potted orchids at cost price plus. For example, 75% of the
12-cm pot Phalaenopsis with at 12 flowers were sold for 3 EUR or
more in 2017. However, in 2018, the price was only maintained between
50-60 %. The estimated average auction price of Phalaenopsis
products from week 1 to week 24 was 2.9 EUR that was 0.8 EUR was found
to be lower than that in 2017. The price that sold by auction and
intermediate services during the same period was 3.58 EUR, which was 0.4
EUR less than that in 2017 .
there arose a question such as why the recognized about the potted
Phalaenopsis was changed from miracle crop to a thin or no profit
crops? What was the fundamental issue in the Phalaenopsis
industry of the Netherlands? The methodology of this study was to
collect the related information from literature, especially from the
reports of auction markets. The quantities of production and turn over
were analyzed. The flow chart of production was introduced. Then the
practical method to alleviate these problems was proposed. In this
study, the article was organized different sections as follows; section
2 presented the traditional process of Phalaenopsis pot plant
production and the new production
schedule. Section 3 presented the change of sale prices
investigated in monthly units.
Section 4 presents the market's estimated demand for potted plants of
Phalaenopsis. Section 5 proposed the fundamental problems and
suggestions in the Phalaenopsis industry for the Netherlands. The
final conclusion was discussed in section 6.
process of Phalaenopsis pot plant production
chart of traditional Phalaenopsis production is shown in Figure
3. Breeding, selection and production of seedlings were carried out in
nurseries such as Floricultural and Anthura.
plants reached the desired size (usually determined by leaf width and
culture period), they are transported to production companies such as
Opti-Flor and Ter Laak, where the seedlings are transplanted into 12 cm
pots and sent to the vegetative greenhouse.
Flow chart of the traditional production and sale of Phalaenopsis
in the Netherlands.
growing greenhouse, typical day and night temperatures are maintained at
28 ° C and 26 ° C, respectively. Once these plants reach maturity, they
are moved to the cooling room for spiking. The environment was
maintained at 20 ° C and 18 ° C during the day and night, respectively.
required time period (in weeks) for the Phalaenopsis pot plants
is shown in Figure 2. In nurseries, it usually takes 2 years or more to
produce tissue culture plantlets from the mother plants. These plantlets
are removed from the culture vessels and transplanted into a soft tray
or plug. After 26 weeks of cultivation, the plantlets were planted as
seedlings and then delivered to the production company. In the
production company, it takes half a year (26 weeks) to grow the mature
plants and finally treated the plants by cooling. The Phalaenopsis
potted plants are then shipped directly to the auction market or to the
chart in Figure 4 shows the perfect production plan. Production
companies regularly receive the young plants from nurseries in regular
schedules. Every week or every two weeks, they receive a certain number
of young plants and are ready to produce. After 46 weeks or more, the
flower products of these plants are sold and the production period is
determined [4-6, 15-16].
The required periods (in weeks) for the potted Phalaenopsis in
Due to the
regular production plan, the space utilization of the greenhouses used
for production is indeed very easy to plan. The first phase of the
vegetative phase used nearly 30% of the area; 15% for the second
vegetative phase; 17% for the spiking; and the last 38% for the
flowering [5-6]. The labor required was fixed and it is easy to manage
at these different stages.
production company receives young plants at a fixed time, the nursery
can easily arrange their production plans. They can produce the same
number of young plants per week because they can prepare the same amount
of the same number of plant tissue plantlets per week. In other words, a
sterile laminar flow cabinet can be operated every working day and it is
often easy to prepare the required amount of operator and tissue culture
the key to the success of the Phalaenopsis industry is that the
nursery supplies a fixed number of plantlets. Production companies can
receive similar amounts of plantlets and sell them after a fixed culture
period. In the auction market, the same number of Phalaenopsis
potted plants are sent every working day and a similar number of
products are sold on the market. In the first stage of 2003-2007, each
sector of this Phalaenopsis industry worked well and smoothly.
beginning of the diversity of the Phalaenopsis pot plants market,
different pot sizes were accepted in the market since 2010. The
production schedule for four pot sizes are shown in Figure 5. For
example, 6 cm potted Phalaenopsis only required 35-40 weeks from
the tissue-culture plantlets to reach the mature stages and spent 6-10
weeks for spiking and flowering as shown in Figure 5. After finishing
the young plant stage, 9 cm potted flowers took 9-14 weeks to reach the
various pot sizes, the required cultivation times are different and the
spaces required for different pots sizes are different from each other.
Changes in production schedules not only affect the production period,
the amount of greenhouse space and labor required, but also the delivery
time and quantity of young plants for the nursery.
The new production schedule for the potted Phalaenopsis in the
change of sale price investigated in
quantity of Phalaenopsis pot plants showed problem of over-supply
since 2008 and the supply was not constant during each month in the
auction market. The sales quantities of Phalaenopsis in a typical
auction market for 2008 and 2010 are shown in Figure 6. In some months,
the supply quantity was found to be higher.
The sales quantities of Phalaenopsis in a typical auction market.
●Red:2008, ▲Black, 2009, ♦ blue, 2010.
price of Phalaenopsis in the auction market for 3 years
(2008-2010) is shown in Figure 7. According to Figure, prices in
February, May and November seem to be higher, and prices in summer are
The sale prices of Phalaenopsis in a typical auction market.
trend in data was discovered in 2014, as shown in Figure 8. There are
three sizes of flower pots in the flower market. The price distribution
of the three pots is very similar. It is estimated that prices are
higher in February, March, May, November and December, and lowest in
Sale price of three pot sizes of Phalaenopsis in 2014. The data
source is from Mr. Ivo Biemond, Symphony of orchids .
similar trends were found in recent years [22,24,26]. In spite of
selling the different sizes of potted Phalaenopsis were sold in
the market, the trends of sale prices were similar as estimated in 2008
estimated demand for Phalaenopsis pot plants in the market
estimated trends of the demand are shown in Figure 9. It could be stated
that the law of demand and supply is the basic principle for the flower
market. The quantities of demand were the estimated values from the
information of some typical auction markets [22-26] and orchid companies
Estimated demand of Phalaenopsis in The Netherlands. The
quantities of demand were the estimated values from the information of
some typical auction markets [22-26] and orchid companies [3,26].
types of demands estimated were as follows:
demand: June, July, August and the first 2 weeks of September
Moderate demands: January, March, October
demand: February, May, the last 2 weeks of September, November,
Phalaenopsis production was affected by the supply of pot plants in
production companies. The estimated demand for Phalaenopsis in
one auction market of The Netherlands is shown in Figure 9. Based on the
data, the obtained information were as follows:
the total supply quantity was 600,000 units (in Figure 9), the supply of
each week was found to be lower than that of the demand, and the orchid
price was high. That was true in the era of 2003-2007 and the average
price of this year was higher than the production cost.
the total quantity was 1,000,000 units (in Figure 7), orchid company
gained benefit in some months and loss in other months. As the gain was
apparently larger than the loss, it could be known that they obtained
the positive net income. The average price of this year was found to
approach the production cost.
the total supply quantity was too high (1,400,000 units in Figure 7),
orchid companies obtained a benefit only in some months. Most of the
year, they received a negative net income, that is the total income was
found to be negative. The average price of this year was found to be
lower than the production cost.
to sustainably operate an orchid production company, the total supply of
seasonal or monthly Phalaenopsis potted plants should be
adjusted. In fact, in order to get more benefits, the basic possibility
is to reduce the production cost by increasing the planting area of the
orchid company. Therefore, some companies with smaller greenhouses will
be forced to close the industry. For example, at least 10 companies are
expected to exit the industry in 2019 .
fundamental problems and suggestion for the Phalaenopsis industry
were discussed in the following.
reducing the production costs by increasing greenhouse area, the other
way was possibly to adjust the supply of Phalaenopsis pot plants
in each week or each month, that is, the orchid companies could increase
the supply in higher-demand months such as in February, March and May
and reduce the supply in the hot season. In this way, the supply and
demand could be balanced. The supply of Phalaenopsis pot plants
was found not to be constant throughout the year. There would be higher
requirements during some important holidays and pretty lower
requirements in the summer.
together all into consideration, it could be noted if production
companies adopted, this new production schedule, there was a need to
rearrange the space utilization of their greenhouse needs to be
rearranged. The labor requirement should also be modified. The most
important change in the production schedule was fund to be the supply
time and quantity of young plants. Since the young plants were
delivered, they were not cultured in the same schedule and not sold into
same quantity. The orchid production companies were willing want to
order more young plants in high-demand months and only fewer quantities
production companies could change their production plan, a serious
problem would occur in the nurseries. The nursery was expected to
deliver a high quantity of young plants in high-demand months and less
quantity during some weeks. So there was a need to modify the production
plan. The laboratories required to produce more tissue-culture plantlets
in some months and reduce the production in other months. They could not
produce the same quantity of plantlets for each day or each week. Under
this condition, all sterile laminar-flow cabinets could not be operated
all around the year. This uneven production schedule thus caused
management problem in the laboratory. This was the fundamental problem
for the Phalaenopsis industry in Europe.
to alleviate this uneven production, some methods were suggested as
manufacturing of tissue-culture plantlets in other countries could be
the one possible way. However, overseas laboratories could also face
same problems of uneven production if their production scale was
methods suggested to the growers to adjust their supply time to market
were the environmental and management. For example, regularizing the
setting values of day, night temperature & light intensity and adjusting
the concentrations and ratio of N-P-K. However, the quantities of
regular supply were limited by these methods.
existing uneven requirement of flowers in the market and the constant
supply of potted plants as the essential problems for the
Phalaenopsis industry could not make the balance of demand and
supply. Hence, it was required to balance the supply and demand.
However, as the problems for nurseries and production companies, the
uneven supply to market could induce an uneven production of young
plants and tissue-culture plantlets. If these essential problems could
not be solved, the quantities of the Phalaenopsis sold in markets
would be confined in the limited quantities nowadays. The developing
process of the Phalaenopsis industry was a lesson for the
emerging flower industry.
recognition about the potted Phalaenopsis was changed from
miracle crop to a thin or no profit crops. Hence, there was a need to
study the fundamental issue in the Phalaenopsis industry of the
Netherlands need to be studied. As the main idea of this study, the
traditional process production and the
new production schedule of Phalaenopsis pot plant were
introduced. The change of sale prices were
investigated in monthly units and the
estimated demand for Phalaenopsis pot plants in the market was
exampled. The uneven requirement of flowers in the market and the
constant supply of potted plants were found as the essential problems
for the Phalaenopsis industry. It was also observed that the
balance of demand and supply could not be made easily. So the supply of
Phalaenopsis pot plants for each week or each month should to be
adjusted in order to operate sustainably an orchid production company.
In order to overcome the drawbacks, the methods suggested were to adjust
the supply quantities of plantlets for plantlets nurseries and modified
their supply time to market with the environmental control and
limitation of this research was the lack of the interviews of individual
orchid company and members of the orchid clusters. So the content of
this paper was a brief report in this journal. More detail research
should be performed about this subject. The content of this paper could
provide some ideals of this Phalaenopsis industry.
Chiachung Chen drafted the proposal, executed some experiments,
interpreted some results and write the manuscript critically and
interpreted the results
authors would like to thank the Ministry of Science and Technology of
the Republic of China for financially supporting this research under
Contract No. MOST- 107-2313-B-005 -012.
Conflicts of Interest:
The authors declare no conflict of interest.
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