Flower Business in Bangladesh

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Prepared for:

Kazi Ayesha Siddiqua Lecturer, Department : Business Studies Course Title : Microeconomics Course Code : ECN-201

Prepared by:

MD. Shariful IslamUG01-18-08071MD. Ahasanul HoqueUG01-23-10-052MD. Sohel RezaUG01-21-09-034MD. Mustafizur RahmanUG01-20-09-039

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LETTER OF TRANSMITTAL

6th August 2011

To Kazi Ayesha SiddiquaLecturer, Department Of Business StudiesState University of BangladeshDhaanmondi, Dhaka

Dear mam,

In the following pages, we have presented the summer 2011 Microeconomics – ECN: 201 report, which you had authorized us to prepare and submit by 6th August 2011 as Microeconimics-ECN:201 – course requirement.

We collected all the relevant information through your instruction. We think that is the report contains the information that you need to get an idea about the Flower Business in Bangladesh. If you need any clarification or any further information We would be happy to provide it to you.

Sincerely,

MD. Shariful IslamUG01-18-08-071MD. Ahasanul HoqueUG01-23-10-052MD. Sohel RezaUG01-21-09-034MD. Mustafizur RahmanUG01-20-09-039

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Acknowledgement

It is a great pleasure for us to acknowledge the assistance and contributions of a large number of individuals to this effort. First we would like to thank our lecturer Kazi Ayesha Siddiqua for her concrete knowledge about preparing this report and the whole subject that have helped us to lead this paper to its successful completion.

A lot of effort had been there to make this report even than this report, could have not been prepared without the genuine and ardent support of few people.

We are going to get help to many people in the context of preparing this report and some of the persons have been very helpful and cooperative with information and suggestions. So by this way I could finish the report properly and on time.

Our heartiest thank goes to all others who directly or indirectly helped me to make this report complete and successful one.

Last but not least, we gratefully acknowledge the support, encouragement, and patience of our families.

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Executive summary

This report on Flower business in Bangladesh is done to find out certain objective regarding the strategic approach Adopted by Flower business man to stand strongly in the competitive flower market. The outcomes of these report are properly analyzed to find out the various aspects like flower business position and competitors position in the market. This report on information about flower business market not just give description about the flower business but it also talks about the various marketing strategy adopted by the business man. Analysis of flower business helps to find out the problems of the business and to find out the way to overcome this problem.

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Table of Content

S.N. Topics Page no.1 INTRODUCTION 07

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OBJECTIVE07

3METHODOLOGY

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4 FLOWER MARKET INTRODUCE 08

5 MARKETING CHANNELS 106 DATA ANALYSIS AND RESULT 12

7 PROBLEMS IDENTIFY 14

8 OUR SUGGESTIONS 15

9 CONCLUTION 16

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INTRODUCTION:

A flower a day makes the problem go away. Everybody gives flowers. Everybody gets flowers. Nobody is branding flowers.

Here are very important facts about flower business in Bangladesh:

In occasions people give a bunch of flowers – not just one, wrapped in some paper, plastic or other form of packaging.

Flower is the universal symbol of love. So any flower company can broaden their scope from being in the flower business to being in the “love” business and most importantly – DEMAND A PRICE PREMIUM.

OBJECTIVES

To collect current data from present flower business market and identify to flower business problems and give to solution of problems.

METHODOLOGY

PRIMARY DATA SOURCES

Observation method, and

Experiment

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( Internet for government taken steps)

FLOWER MARKET INTRODUCE

In Bangladesh, small-scale flower production initially started inlate seventies by some innovative farmers with the production of tuberose, but largescale commercial production was started in mid eighties in Jhikargacha Upazila ofJessore district. The most common, commercially grown flower species in Bangladesh are tuberose (Polianthes tuberosa), rose (Rosa indica), marigold (Tagetes erecta, T. patula), gladiolus (Gladiolus spp) and orchids. Bangladesh is well suited for cut flower and foliage production due to its favourable climate and other conditions such as scope to expand cultivation in unutilized homestead lands, cheap labour, relatively low capital investment in contrast with high value addition and good prospect for exports. Cultivation of flower is reported to give 3-5 times and 1.5-2 times more returns than obtained from rice and vegetable cultivation, respectively. At present, 10,000 hectares of land covers flower cultivation taking the lead by Jessore district. More than 5,000 resilient farmers are growing flower and foliage in the country and about 150,000 people are directly or indirectly involved in floriculture business as their sole livelihood. At present, the government has been emphasizing the need to accelerate diversified agricultural production.However, floriculture has not received any direct attention or organized intervention for development. The achievements that have taken place silently in the floriculture sub-sector of agriculture, is almost entirely by the private sector initiative in an unorganised way and without support from the government.Therefore, if the flower industry is explored by farmers, traders, exporters and policy makers it can significantly contribute to the national economy by earning foreign exchange, generating employment and increasing GDP.

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In Bangladesh flowers are cultivated commercially in few areas only. On thebasis of high concentration, Jessore district is considered as one of the leading cut- flowers producing zone in Bangladesh. 'Godkhali flower market', is popularly knownas the centre of floriculture of Bangladesh, under Jhikargacha upazilla of Jessoredistrict where there is an annual sale of Taka 15 crore worth of flowers that covers 70percent of the country's total flowers for both domestic use and exportationFurthermore, Shahbag area of Dhaka city was also selected as the study area to collect data for the wholesale market, because Shahbag flower market is the only wholesale flower market in capital Dhaka which was established in 1990. The interviews focused on flower marketing system, marketing costs and returns, constraints of flower business and the possible solutions of flower problems of market.

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Marketing channels

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Farmer

Local trader (Jessore)

Wholesaler-cum-retailer(Dhaka City)

Retailer (Dhaka City)

User

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The following channels can be identified on the basis of market channels

Channel- I Farmer -local trader- wholesaler-cum-retailer -Retailer user

Channel- II Farmer -local trader –retailer- user

Channel- III Farmer -local trader- wholesaler-cum-retailer -user

Channel- IV Farmer -wholesaler-cum-retailer -retailer -user

Channel- V Farmer- user

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Data Analysis and Result

Age Number of person

Sex MaterialStatus

Instruction Capital

Cost &

Earning

Collecting source

Below 20-25 Person

3

Male 2 person un-

married &1 married

2 person illitrate & 1

HSD

5000 to

20000

Daily

Shahbag, Khamarbar

y.

25 to 30

Person 9

Male 5 person married &

4 un-married

5 person illiterate, 3 Ele,Deploma, 1 HSD

5000 to 3 lac

Daily

Savar, jessor,

jhainidha

40 to below

55

Person 8

Male 7 person married &

1 un-married

3 person illiterate & 3 HSD, 1 ele.dep, 1 University

deg.

5000 to 11 lac

Daily

Gazipur, jessor, nator,

Narangong.

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Pie Contribution of each value to a total

On the basis of age

We can see in pie that the large number of portion is 25 to 30 age. And the most of the person are married and earn suitable profit from this flower business. Second are medium portion of pie is 40 to below 55 and they are also earn suitable profit and satisfy of this business. Last little number of portion is below 20 to 25, they are youngest person of flower business or the are doing this business in part time.

Below 20-25

25 to 30

40 to below 55

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Problems Identify

Marketing cost of flowers for farmers:

Cost item Tuberose Rose Gladiolus MarigoldPlucking and assembling

0.9 1.4 1.25 0.3

Transportation

0.77 0.9 0.9 0.25

Cleaning and sorting

0.75 0.9 0.75 0.1

Grading 0.32 0.45 0.42 0.2

Loading and unloading

0.5 0.7 0.75 0.1

Spoilage and damage

1.8 4.45 3.8 0.3

Other 0.25 0.3 0.25 0.02

Total 5.29 9.1 8.12 1.27

Average prices for tuberose, rose, gladiolus and marigold were Tk. 60, Tk.130, Tk.110 and Tk.6.50 per hundred respectively. But on this price the farmer can earn suitable profit but not a whole seller or retailer. This is a major problem of business. All retailer are not satisfy with little profit. They are facing also transport problem, preservation problem, price problem and Lack of adequate market information.

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Major problem are Lack of storage facilities, Unsold flower, Inadequate space within the shop, Fluctuation of demand, and Strike and hortal.

Our suggestions

Storage facilities should be established both in public and private sectors.

Traders need scientific knowledge and training on handling, grading, processing and displaying flower in attractive way for sale.

Market information should be made available to the all regularly.

Government and local government may take necessary steps to establish permanent wholesale and local market.

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CONCLUSIONS

The findings of the present study indicate that business of flowers is a profitable business. The return over cost is almost double, which indicates high profitability. It can be said that flower cultivation and marketing has wider scope in Bangladesh, so it could certainly be benefited financially if performance of marketing system of flower becomes well developed.

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