Rwanda’s flagship flower producer, Bella Flowers, has received strategic advice to pivot its production towards fresh and plastic flowers tailored for the local market. The recommendation comes as part of efforts to mitigate ongoing losses incurred by the company.
Bella Flowers, a government-backed project operating under the National Agricultural Export Development Board (NAEB), was established in 2014 with an initial investment of Rwf2.2 billion, disbursed in phases. Additional funding from the Rwanda Development Bank (BRD) totaling Rwf4.3 billion was allocated to support the acquisition of essential infrastructure, including irrigation systems and equipment.
The company embarked on its journey into floriculture in July 2016, initially focusing on the cultivation of cut roses across 6 hectares. However, the Auditor General’s report for the year 2022 revealed a consistent pattern of financial losses sustained by Bella Flowers since its inception.
To illustrate, during the 6-month period leading up to June 30, 2021, Bella Flowers recorded sales totaling Rwf3,662,806 while incurring costs of sales amounting to Rwf3,014,988, resulting in an 18% gross profit margin ratio. In comparison, the company’s performance for the equivalent period ending June 30, 2022, showed sales of Rwf2,188,571 against costs of sales reaching Rwf2,963,235, indicating a reduced gross profit margin ratio of 35%.
The advice to shift its focus towards fresh and plastic flowers for the local market is intended to help Bella Flowers reposition itself and address the financial challenges it has been facing. As a strategic government investment initiative aimed at enhancing the floriculture industry in Rwanda, the company’s future actions will be closely watched as it seeks to adapt and thrive in the evolving market landscape.