Italian industry under the new normal

Francesco Mati says, “All our activities were affected but one of the reasons we survive is our diversification.”

Author: Aldo Colombo

Italy was the first European nation to be struck by the coronavirus pandemic and has paid enormous social and economic costs. At the time, did we realise that the methods set-up to protect people from the spread of Covid-19 would severely impact the country’s ornamental horticulture industry? However, it was clear from the moment the government allowed the production of flowers and plant to continue while ordering all sales outlets to shut, that there would be problems.

Faced with an unexpected and dramatic drop in sales, Italian growers, wholesalers, and retailers alike struggled to find a way to survive the coronavirus crisis. Different market operators chose different strategies. However, when the country eased the lockdown restrictions, the business environment proved a lot better than anticipated.

In May, June and July, Italian plant retailers enjoyed a strong surge in sales outperforming the figures of the previous years. However, the loss of sales in March and April, usually the most profitable months of the year, will never be recovered.

As such, a lot of growers are still waiting for a substantial financial stimulus package from the government. Hopefully, the EU’s recovery fund worth €750bn, also known as Next Generation EU, will help the Italian Ministry of Agriculture to keep its promises that so far are parole parole parole only. To get aid proves a difficult task for horticultural businesses and financial relief for growers has been little. The bank loans guaranteed by the State, agricultural loans obtained through the ISMEA authority, the wage support for the workers, and many others were arduous to get for flower and plant nurseries already facing troubles with the economic crisis and other structural problems of doing business in Italy.

The various segments of the market were affected differently: to follow are accounts from three growers who share their thoughts and explain their distinctive business strategies.

Grower One: Mati

Francesco Mati says, “All our activities were affected but one of the reasons we survive is our diversification.”

Founded in 1909, Mati is one of the oldest wholesale plant and tree nurseries in Pistoia. They are now a group which includes a landscaping and contractor company, an Academy for green professionals, and a restaurant.

Owner Francesco Mati elaborates, “All our activities were affected but one of the reasons we  survive is our diversification. Our Academy we kept going as we could reach our students through online platforms. The nursery lost approximately upwards of 40 per cent of the turnover, but at least we did not have to destroy our plants, as was the case for flowering plants and cut flowers. After re-opening, we had a good recovery, and we hope for an excellent Autumnal season.

Besides the Academy, Mati manages the landscaping section. He professes, “I have never been so busy with quotations for new gardens or restorations of old ones. If only a small percentage comes into practice, I will be happy. Similarly, for two months maintenance activity in private, and public gardens was stopped, therefore when we re-started, we had to face problems such as the tall grass, the missed seasonal pruning and a massive backlog of tasks.

“The restaurant was the most affected of our group activities: my brother could not operate it for more than three months, and also after he re-opened, he lost a substantial share of the midday clientele that usually work in the surrounding area. However, later in the day, in the evening, people are starting to come back to enjoy eating in our demonstrative vegetable garden with products directly coming from the field to the dish.”

“I also hope that staying at home has made people appreciate more and more their parks and ornamental and vegetable gardens as social gathering places. We still urgently need a deep cultural change, especially in our political class. They should learn from our best experts, like Francesco Ferrini and Stefano Mancuso, who are known worldwide, but not well enough in our country!”

Grower Two: Cristiano Genovali

The industry association AFFI (Associazione Floricoltori e Fioristi Italiani), including cut flower growers, florists, and floral designers, was founded in January by Cristiano Genovali, the former President of the Associazione Piante e Fiori d’Italia. Cristiano recalls, “The first question they asked me was why setting up yet another trade association when there were already so many in Italy? My response was as plain as simple: none of existing ones are about cut flowers and none of them includes growers and retail florists.”

Flower grower and AFFI president Cristiano Genovali.

At the end of February, when everything was ready for Myplant it was at this trade show that AFFI was to make its debut. However, that is when the coronavirus started to engulf the country. Genovali says, “I am a small-scale grower, specialising in cut tulips and summer flowers. March is usually my key sales period, but I had to destroy everything. As the newly elected President of a new Association, I have heard the same stories from my peers in Southern Italy. They had no other solution than to compost tonnes of unwanted flowers which, under normal circumstances they would have been sending across Europe, to the Dutch auctions.

“Social media saw the birth of new groups, and I was immediately involved. Retail florists, floral designers, and event planner continue to be the most severely affected of them all. Their peak sales window is between March and May with weddings, communion ceremonies, Mother’s Day, and Easter, and all of them were powerless to do anything in this pandemic situation. After the re-opening of the country, some of them started, for the first time in their life to sell vegetable plants and herbs, the most requested items during that period.

“For the flower growers, the problem was that under the lockdown weddings were no longer able to take place which resulted in a dramatic drop in demand for celebration flowers in soft romantic shades of white, pink, and light blue. Many growers did not replant because of the uncertainty of the future. We predict that there will be a shortage of products in Autumn, for instance in the stock of Chrysanthemums at the end of October. Or, at least, there will be a shortage of local product, as our international competitors were granted stimulus packages from their Governments. And in the meantime, we get only drops in the ocean for our losses.

Ripartiamo con un Fiore (Let’s restart with Flowers) campaign.

“In June, our board decided that something had to be done and started to prepare the Ripartiamo con un Fiore (Let’s restart with Flowers) campaign that we rolled out on 27 June. Its message to the world was that the Italian cut flower industry is still alive and kicking. In every Italian region and the Republic of San Marino, floral installations bedecked the central squares of the most important towns and villages. It was a symbolic effort, especially from the logistic point of view. We have been on national and local television, in many newspapers and magazines, getting the solidarity of institutions, regional and national authorities and, simple passers-by. This campaign attracted more and more attention to our Association and made us a little bit more hopeful for the future.”

Grower Three: Pagano Piante

Raffaele Pagano with his sister Stefania.

Pagano Piante was founded in 1976 by the late Michele Pagano, brother of the two other horticulture pioneers, Antonio and Cosimo. Michele’s sons, Raffaele and Carlo, and daughter, Stefania, continue their father’s business in Ruvo di Puglia, near Bari, in Southern Italy. They specialise in tropical indoor plants such as Ficus bonsai – specimens too – succulents and cacti, tillandsias, and other green foliage and flowering plants.

“It was the end of February. Our truck was loaded and ready to leave for Myplant, the tradeshow that was to be held in Milan,” says Raffaele. “Then I started to receive phone calls with people asking me what I was going to do. I soon realised that most of my clients were not going to attend the Milan show. Then, Myplant announced the postponement of the show and in those 24-hours, there were dramatic developments for us, as clients were closing their business and ceasing transactions. When Italy was under lockdown, we were desperate. “During one of my sleepless nights, I came up with an idea and the next morning, my sister Stefania and I started to build an e-commerce business from scratch. It took some days of learning by flipping through manuals. Luckily, the website address was already in place.

Pagano Piante: posting parcels from the nursery. Flat parcels are used to ship tillandsias.

“Plant by plant was added to a ready-made e-commerce template including own production and that of other local growers. After five days we were ready: the first evening we had around 100 orders, then 80 followed the next day, and another 100 arrived just before the weekend. So, we had 300 requests to ship on Monday, without any logistical experience. We had a numerically controlled machine for our packings, and we tried them out, throwing the plants together like the fastest delivery men in the world.

“We called four different express carriers: we understood immediately that one of them was unable to deliver the plants, and we informed the clients, refunding them all the costs. They understood, and most of them asked us to reship the plants: reviews were almost 100 per cent positive. The plants, from small pelargoniums to our specimen Ficus, arrived in good condition and we got the trust – and the reorders – from these clients.

“Taking a pro-active approach helped us from the psychological point of view. After the lockdown easing, we started again with our ordinary wholesale business of Pagano Piante. The webshop is now following a ‘parallel’ growth route, and we are still receiving a good quantity of orders online. We want now to improve the customer experience, with a tailor-made site, always adding new texts on how to care for plants, and we’re counting on a strong new base of digitally-acquired clients.”


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