Royal FloraHolland has decided not to proceed with the current Central Auctioning model; From Farm auctioning is not an alternative

Royal FloraHolland will not proceed with rolling out the current Central Auctioning model to other product groups and has decided against developing the From Farm auction concept. This conclusion and decision follow a thorough study conducted over the past year into various auction scenarios. The results of the study show that these forms of auctioning do not sufficiently contribute to a future-proof and balanced auction landscape for the cooperative, buyers and growers. With this decision, Royal FloraHolland is opting for clarity towards growers and buyers and for focus within the organisation.

Pause and careful evaluation 
The development of the current Central Auctioning concept began several years ago. It had a clear objective: a single price point and location independence, thereby optimising price formation. However, the reality proved more challenging. The further roll-out of this form of Central Auctioning has therefore been paused in 2025. This is because the effects on price formation were, on average, neutral and did not yield any clear improvements, whilst undesirable side effects did occur, such as further volume shifts between hubs and rising logistics costs.  

Over the past period, Royal FloraHolland has therefore conducted an in-depth analysis of various scenarios with a view to moving towards a single price point and greater location independence. As part of this process, various forms of centralised auctioning, including in combination with forms of From Farm auctioning, have been thoroughly evaluated. David van Mechelen, interim CEO, says: “As the board and management team, we have discussed at great length the opportunities, consequences, possibilities and limitations that these approaches present. Further development of location-independent auctions does not appear to be a viable solution. Studies into From Farm auctioning or Today for Tomorrow also do not appear to offer a future-proof solution for most of our buyers and growers. We have therefore decided not to pursue these forms of auction for the time being.”  

Reasons not to proceed with the development of Central Auctioning  
An extensive analysis of various forms of Central Auctioning, carried out by a team of subject matter experts from within and outside the organisation, shows that none of these are feasible. The further implementation of the current Central Auctioning system still has three price points instead of one. Although combined auctions offer a better overview for (larger) buyers, other expected benefits, such as smaller price differences between hubs, have not been realised, or only to a very limited extent, in practice. At the same time, Central Auctioning has shown undesirable side effects, including a further concentration of volumes at a single hub and a disruption of the supply balance between hubs. Another key conclusion from the analysis is that an ideal scenario, with just a single price point and complete location independence, requires highly accurate forecasts of buyer demand per hub. It also requires complex logistical management. In practice, however, buyer demand appears to be too erratic and unpredictable. This is also evident from detailed analyses based on historical data and AI forecasting models. Van Mechelen: “These observations and conclusions have led to the decision that, for the time being, we will not be developing these concepts of location-independent auctions further and that we will continue to auction using the clocks – central and local – as we have today. For now, we are focusing on other strategic priorities.”  

From Farm auctions not going ahead  
The study also shows that From Farm auctions will prove practically unworkable for a large proportion of growers and buyers. For most growers, the model presents too many logistical constraints, such as limited available buffer capacity at the nursery or the ability to respond to fine-grained demand. Finally, there is no clear picture of the consequences for pricing, and delivery times are longer. Consequently, in many situations this leads to inefficiency in the supply chain. For buyers, From Farm auctions do not sufficiently meet their need for timely availability, predictability and combined purchases of different product groups. Today for Tomorrow auctions are also not possible for some buyers. It requires bidding at the weekend for delivery on Monday. Van Mechelen: “The study shows that these limitations are structural and cannot be resolved through adjustments, given the current rhythm of the sector. This means that, on a large scale, From Farm auctions do not offer a realistic future prospect for the majority of our growers and buyers.”  

Clarity and focus: a vision for the future 
With this decision, Royal FloraHolland is opting for clarity towards growers and buyers and for focus within the organisation; first realising other strategic priorities, so that new developments in auction tactics can be considered again in the future. “We have investigated and tested various alternatives over the past few years. This has provided us with many insights that we can use to our advantage going forward. Among other things, the study shows that Central Auctioning and From Farm auctions have too many disadvantages and undesirable side effects and cannot be rolled out sufficiently on a large scale. As such, they do not offer us a viable solution,” says Van Mechelen. “By making clear choices now, we create clarity and peace of mind, allowing us to focus fully on the future-proof organisation of auctions and the tasks we need to tackle anyway. This year, we are focusing first and foremost on the implementation of 100% order picking in Aalsmeer, which paves the way for the further roll-out of the new and successful day trading proposition, Floriday Day trade. In addition, our ambition is to start auctioning via Floriday this year. To achieve this, our IT development teams are fully focused on replacing the outdated KOA systems. The RFH Pre-Auction and RFH Auction apps will then enable auctions via Floriday. With these developments, we are creating opportunities and laying the foundations for future solutions that better align with tomorrow’s market, such as potentially a single pricing moment across all hubs. We have also adopted a new way of working, whereby we test ideas more quickly, explore them together with growers and buyers, and then begin experimenting with them. In this way, we aim to bring solutions from the drawing board to the auction floor more quickly and see if and how they work in practice. This has proven to be an effective approach, which is appreciated by our customers and offers a greater chance of success.”

You can read more about other developments in day trading soon in the column by Thomas Bugel, Chief Grower Value Management.