Flower Seller Hopes to Ride Organic Boom Blooms
Free of Pesticides Find a Market, but Profits Still Haven't Blossomed
By JOEL MILLMAN
Staff Reporter of THE WALL STREET JOURNAL
August 16, 2005; Page B7
Consumers embrace the organic when it comes to the fruit and vegetables they eat. Can organic flowers be next?
Gerald Prolman is counting on it.
Mr. Prolman, founder of Organic Bouquet Inc., is trying to develop a new industry dedicated to growing, marketing and, above all, profiting from organic flowers.
This year, his OrganicBouquet.com, based in Mill Valley, Calif., expects to sell $3 million of pesticidefree flowers -- about 70% of them long-stemmed roses. Selling online and in high-end supermarkets like Whole Foods, the florist also reaches potential customers through alliances with companies and nonprofit organizations concerned about pesticide use and the health of workers. It's a niche in the $20 billion-a-year U.S. floral business that didn't exist five years ago, but one that has yet to prove profitable for Mr. Prolman.
An "extra" in most budgets, flowers, especially roses, have drawn attention world-wide from humanrights workers and environmentalists, not because of any danger to the buyers, but because of the heavy amounts of pesticides that the growers of such flowers can be exposed to.
With nearly 60% of the cut flowers purchased in the U.S. grown overseas, mostly in Colombia and Ecuador, much of the concern about pesticide and fungicide use on flowers has focused on operations in the Latin American countries.
"Growers of ornamental plants, especially cut flowers, tend to use exceedingly high levels of hazardous pesticides," says Margaret Reeves, senior scientist at Pesticide Action Network North America of San Francisco. "And they don't have the same constraints in terms of chemical residue, because their product is not consumed."
One result, Ms. Reeves says, is that workers in the cut-flower industry routinely are exposed to higher levels of contamination than other agricultural workers, a problem made worse because they work in enclosed environments, typically in greenhouses.
In recent years, however, some growers have become more responsive to the concerns of environmental groups and labor-rights activists.
"Farms are learning how to improve continuously," says Juan Carlos Isaza of Asocoflores, a trade association for Colombia's cut-flower industry whose Flor Verde program has been teaching growers to use fewer pesticides and chemical fertilizers. "In the 1990s, our image was very negative, and I think there was an overuse of chemicals, just like anywhere flowers are grown -- even the U.S. and Holland. Now people are learning how to use pesticides more carefully, and using less of them."
But for Mr. Prolman, the way to ensure the safety of the workers, protect the environment from chemicals that might endanger the ecosystem, and enrich the soil in a responsible way is to simply go organic.
If enough consumers can be persuaded to "buy green" when purchasing roses, Mr. Prolman reckons, more plantations will produce them under improved conditions.
Along the way, Mr. Prolman has had to be just as nimble a marketer as fund-raiser, consciousnessraiser and incubator of other businesses, principally the South American plantations that grow his wares.
"Basically, when we started, there was no supply, no demand and no capital," says the 45-year-old Massachusetts native. "I had to develop all of that myself."
What he did have was practical experience. His first venture was Made In Nature, a fresh-produce vendor Mr. Prolman launched with fellow eco-entrepreneurs in San Francisco in 1989. It grew successful enough to attract the attention of produce giants like Dole Food Co., which acquired the brand in 1994. A year and a half later, when Dole decided to shed noncore assets, Mr. Prolman bought Made In Nature back, later selling it again to another vendor, Vacu-Dry Co., of Sebastopol, Calif.
Mr. Prolman made enough money on each transaction to repay the organic "angels" who staked him with a sufficient return on their investment to tap them again for funding when he launched Organic Bouquet in 2001. "We believe in the business model," says Don Weeden, whose San Francisco-based Weeden Foundation has invested nearly $200,000 in two Prolman ventures. "He's got the Internet to market with now, which didn't exist before."
Even before it could hunt for investors, however, Organic Bouquet needed growers. Organic fruit and vegetable farmers were plentiful in California, but the dot-com bubble had just burst in 2001, while skyrocketing energy prices across the state left growers reluctant to try an unproven venture like organic roses.
"Growers weren't looking to grow organic flowers, because the market wasn't demanding them," says Mr. Prolman, and "the market wasn't demanding them because they weren't available." The solution lay in South America, where enough low-cost operators had access to virgin land that they could begin to produce organic flowers immediately. To get them started, Mr. Prolman signed contracts locking in the price of every organic rose they grew -- freeing growers from relying on brokers and daily spot prices, which can swing wildly from season to season.
Searching for growers in Ecuador and Colombia, Organic Bouquet had help. Because of concern among consumer groups that flower growers should use methods that don't endanger workers through consumer groups that flower growers should use methods that don't endanger workers through overexposure to pesticides, some South American growers have already been "Green Label" certified. That designation -- pioneered in Germany by the Fairness in Flowers campaign, a grass-roots alliance in Europe set up to certify growers' environmental and labor practices -- meant they met one of Mr. Prolman's requirements: They were already using methods easily adapted to organic farming.
"They weren't completely organic, but they were close," he says.
Selling roses online for as little as $39.95 a dozen, Organic Bouquet now competes on price with other big online vendors like FTD.com and 1-800-Flowers.com. The company is seeking to boost sales by appealing to socially conscious consumers, for instance, by offering a 10% to 15% discount to members of the World Wildlife Fund or People for the Ethical Treatment of Animals; PETA gets 5% of every sale Organic Bouquet makes to a PETA member, which allows buyers to make a cash contribution to their pet cause when they buy.
Organic Bouquet also has become the in-house florist for ice cream makers Ben & Jerry's, the South Burlington, Vt., unit of Anglo-Dutch food giant Unilever. Ben & Jerry's employees enjoy a 20% discount, and Mr. Prolman's company is seeking similar arrangements with others.
"The true 'flower power' is that our two organizations are simpatico," says Christie Heimert, spokesperson for Ben & Jerry's. "They're the go-to guy when we want to thank a client by sending flowers."