Flowers plus internet equals e-commerce success

Seeing the potential of internet long before Pinoy entrepreneurs harnessed the power of e-commerce, Philippine Cut Flower Corp. (PCFC) developed a website, based on an MBA thesis, that eventually grew into one of the first online success stories in the country.

The idea behind the “Island Rose” brand in 1999 was to enter the retail market without bypassing a stagnating wholesale business, PCFC Vice President and COO Arnold Andaya told GMA News Online in an interview at their farm in Tagaytay over the weekend.

"The internet was already booming in the US and the Philippines was just starting way back then. We looked for some companies as an inspiration for our business model and then we started the Island Rose website,” Andaya noted.

“It’s probably safe to say that we were the one who first started selling flowers in bouquet form online … We are also, probably, one of the first successful online ventures in the Philippines, though we started very small and back then the internet connection was still through dial-up modem,” he added.

To spur retail business

The website, www.islandrose.net, was the brainchild of PCFC President and COO Dustin Andaya, Arnold's brother.

“The website was my brother’s thesis in his MBA. The capital for the website was such a small amount, maybe between fifty to a hundred thousand,” Arnold noted, saying the money basically covered website development and product packaging as the company was already producing flowers.

The idea was also born out of the need to spur business activity via retail trade, considering that the wholesale clients of PCFC – its main market at that time – seemed to have reached a plateau.

“Our biggest challenge was to encourage our clients to sell more, but it was hard to push them because some of them just sit and wait for orders to come,” Arnold said.

The challenged was how to get into the retail market "without really hurting" the wholesale clients.

Farm-to-market model

Through the website, PCFC started a farm-to-market model that essentially offered freshly-cut flowers deliver to the buyers or the buyer's intended recipient.

Faced with the challenge of delivering flowers to their buyers, without going into the business of logistics themselves, the brothers Andaya decided to take in courier companies as partners.

The partnerships allowed the Andayas and the couriers to develop the market. "And we stayed with our core competence, which is growing and selling flowers," Arnold said.

Filipino thoughtfulness

The website and the partnerships created a business model that helped transform PCFC from a supplier to traditional flower shops to the country’s first online retailer of roses in a multi-million-peso industry

“Keeping relationships alive” is the mantra behind the success of Island Rose, Arnold noted, saying the foundation is built on Filipino thoughtfulness and rootedness in the family. "Normally, we give gifts to our girlfriend or wife, so we are banking on the first gift in mind, which is flowers.”

Arnold believes that flowers actually compliment other gifts like gadgets. "If you give your wife a phone and accompany it with flowers, it makes the phone romantic ... and that creates the mood.” — VDS, GMA News