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<\/a>That\u2019s the idea that has enabled Venice Beach-based online floral retailer The Bouqs Company <\/em>to raise $43M in funding since 2013 (despite CEO John Tabis\u2019 failed Shark Tank attempt in 2014) and to achieve positive cash flow and 200% annual growth [1,2].<\/p>\n The company promises to deliver fresh-cut flowers to your door from \u201ceco-friendly, sustainable farms from around the world so they last\u201d [3].\u00a0 Appealing to consumer preferences for sustainability and transparency [4,5], Bouqs customers purchase their arrangement online for a flat shipping-inclusive fee. Selecting from parameters like delivery window and source of origin including the \u201cVolcanoes of Ecuador,\u201d \u201cThe Hills of Colombia,\u201d and \u201cThe Fields of the USA,\u201d arrangements arrive as soon as the next day from California and in less than a week from South America [3]. The customer value is evident: flowers last longer \u2013 up to three weeks compared to days \u2013 and customers save 15 – 50% relative to traditional retailers (and up to 80% for weddings!) [6,7]. Bouqs also asserts that margins for their growers are better by 20% [7,8].<\/p>\n <\/p>\n So, how has Bouqs done it and to what extent has digitalization been critical to their success?<\/p>\n First, it is important to understand the traditional supply chain that Bouqs is disrupting, which lacks transparency and often results in low-quality flowers and waste [8, 9]. \u00a0Most cut flowers in the US come from South America \u2013 Ecuador and Colombia together account for 90% of stems imported in 2015 [10]. While conditions in these locations are ripe for growing (though sometimes at an environmental and social expense, which is another topic altogether), the challenge is delivering them to consumers before they deplete their food and water stores and wilt, a process which begins upon cutting [10, 11, 12]. Cold helps to slow the decline, necessitating cold-chain practices to maintain temperatures of 33-35 degrees [12, 13].<\/p>\n Flowers move from farm to wholesaler to retailer via trucks and planes and warehouses in a process than can take anywhere from 10 days to weeks [8, 12, 13, 14]. Hand-offs between different players in the supply chain increase the risk that refrigeration will lapse, reducing quality [12, 13]. These factors, together with long lead times which pose challenges to forecasting demand and a limited shelf life, result in 30 – 50% of stems wasted across the full supply chain and flowers near the end of their life upon delivery [9, 13].<\/p>\n Bouqs\u2019 business model, centered on their supply chain, capitalizes on the opportunity to address these problems by shipping directly to consumers, bypassing middle men like brokers, distributors, and retailers, and getting flowers to consumers faster [2]. \u00a0This is enabled by the implementation of proprietary technology at partner farms so that growers receive customer orders immediately and directly upon ordering. Flowers are cut just-in-time and packaged into the box in which customers receive their arrangement [1,2,3]. Bouqs optimizes supply and demand by collecting data on farmer crops and production and leveraging consumer preferences to adjust product offerings in real time [2,14]. Bouqs also uses historical data to predict and ensure supplier readiness to meet demand [2,14].<\/p>\n The result is that Bouqs holds no inventory and farmer wastage is nearly eliminated [15]. In this streamlined, direct-to-consumer model, suppliers have insight into end-consumer demand and Bouqs has the information and flexibility to respond to consumer preferences and changes in farmer production [15].<\/p>\n Moving forward, growth will undoubtedly be important to Bouqs, which currently only partners with roughly 50 farms [8]. As it grows, Bouqs\u2019 current predictive abilities may be tested, as consumers face more choices around sourcing, for example. \u00a0Bouqs will need to accurately anticipate customer demand via predictive signals and diffuse orders across farm partners.<\/p>\n While Bouqs has successfully leveraged technology to build a streamlined, transparent and responsive supply chain, additional opportunities may exist down the road to further optimize a flower\u2019s journey from farm to consumer [16].\u00a0 Innovations related to packaging, such as improvements in trackability and refrigeration, could increase end user transparency and mitigate additional risks to flower quality. While the automation of cutting and packaging flowers could also be up for consideration, the hands on, farm-to-table nature of the product seems central to Bouqs\u2019 value proposition in my opinion.<\/p>\n <\/p>\n In terms of innovation, I\u2019d love to see Bouqs enable even greater customization. What if customers could create their own digital arrangements, which are then cut by farms and shipped? What other opportunities do you see for Bouqs to optimize their supply chain or product through digital solutions to sustain their competitive edge?<\/p>\n <\/p>\n (798)<\/p>\n <\/p>\n Sources:<\/p>\n <\/p>\n","protected":false},"excerpt":{"rendered":" How digitalization is eliminating waste and breathing new life into the cut-flower supply chain<\/p>\n","protected":false},"author":9814,"featured_media":25188,"comment_status":"open","ping_status":"closed","template":"","categories":[3235,3912],"class_list":["post-25123","hck-submission","type-hck-submission","status-publish","has-post-thumbnail","hentry","category-digital-supply-chain","category-flowers","hck-taxonomy-organization-the-bouqs-company","hck-taxonomy-industry-agriculture-and-agribusiness","hck-taxonomy-country-united-states"],"connected_submission_link":"https:\/\/d3.harvard.edu\/platform-rctom\/assignment\/rc-tom-challenge-2017\/","yoast_head":"\n<\/a><\/a>\n