Dutch greenhouse growers dare to expand again

Greenhouse cultivation is on the rise again and Westland entrepreneurs are daring to expand again. "Remarkably most expansion plans are with respect to greenhouse vegetables, where the market balance is less stable," according to Ruud van der Vliet, director Companies at Rabobank Westland in Rabobank’s magazine Dichterbij.

After a difficult period, the Dutch horticulture sector is getting back on its feet again. Ruud van der Vliet, director Companies at Rabobank Westland is also seeing an upward trend. "It was already going a bit better in 2014. 2015 was a good year, and with the positive price developments and the low energy prices 2016 promises to be another good year. We’re also seeing more activity among entrepreneurs: extra lighting is being hung in greenhouses and they’re coming to us with new construction plans.”

Ruud wants to make an observation on the positive developments. "For example, with the greenhouse vegetables we have to be careful, because the competition from other countries is great. This is less of a concern in ornamentals. Remarkably, most expansion plans are with respect to greenhouse vegetables, where the market balance is less stable. For us as a bank this represents a dilemma: To which applications do we respond? If we want to improve and strengthen the sector, then in my view you should make the better companies stronger. Those are the companies with a well-considered vision for the future, that take a good look at what the customer wants and cooperate with other parties."

And that is precisely the approach of tomato nursery CombiVliet in Maasdijk and plant nursery Vreugdenhil in De Lier. Both nurseries are working on expansion. CombiVliet bought a plot in North Holland in 2010 where they've had 48 hectares of greenhouses built in recent years. In the coming years the company will be building new greenhouses in stages. Financial director Eric van Heijningen: "We’re expanding with a view to the future. Everybody around us is growing: our competitors, but also our clients and our suppliers. If we want to remain afloat in greenhouse vegetable cultivation and maintain a good negotiating position, we need to grow as well."

Vreugdenhil is also expanding with a view to the future. "We started building new greenhouses three years ago," says managing director Martin Uittenbroek. "When we’re done, we will have 10,5 additional hectares. These are modern complexes, particularly intended for the propagation of vegetable plants.” The expansion was prompted in part by the growth of its customers, says Martin. "We want to meet their needs. But growth is not an end in itself. Delivering quality is. Everything we do is aimed at that."

Besides expansion Vreugdenhil is also pursuing collaboration in order to meet the growing demand. "We are working with plant nursery Klugt. We’re both good with a slightly different product mix. We reinforce each other and together also have a better position at the negotiating table. "CombiVliet also sees the added value of collaboration and therefore joined Harvest House years ago, a cooperative of tomato, pepper, zucchini and cucumber growers. “Harvest House sells our tomatoes," says Eric. "They aim to sell our products directly to retail, without brokers. This way we build a long-term relationship with our clients and have a better idea of what they want. In addition, fewer links in the chain leaves a better margin for us."

“Modern retailers want one-stop shopping," according to Eric. "So preferably only one truck stops in front of their door with everything they want on their shelves: snack and vine tomatoes, as well as cocktail and beef tomatoes. Our expansion and cooperation with fellow growers at Harvest House allows us to offer the whole range in large volumes."

Besides collaboration Vreugdenhil is also pursuing new markets. Martin: "For example, we grow pick yourself vegetable plants for consumers under the brand Pick-&-Joy and we are responding to the demand for organically grown plants. A demand that is quickly rising."

Rabobank Westland was and is involved in the expansion of both greenhouse companies. Eric: "Through 2012 the Rabobank was in fact the only bank we did business with. But because of the changes in regulations that was no longer possible. Together with the bank we went looking for an additional bank. Our consultant adequately supervised and coordinated that process. We’re very happy about how that went."

Martin: "We started our new construction at a difficult time. The decision was justified by making a proper inventory to establish that we had enough clients for those additional greenhouses. The bank has always supported our vision and backed our plans. We are still grateful for that."

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