Price sensitivity analysis and factors influencing purchases of ornamental plants among local institutions

Nik Mohd Masdek, Nik Rozana and Ali, Roslina and Ahmad, Aimi Athirah and Muhammad, Rasmuna Mazwan and Haimid, Mohd Tarmizi (2019) Price sensitivity analysis and factors influencing purchases of ornamental plants among local institutions. [Journal / Magazine]

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Abstract

The floriculture industry is considered a high-value industry. Ornamental plants are mostly used for landscaping, interior and outdoor decoration, generally aimed at creating aesthetic value. New native and exotic flower varieties were developed to meet consumers demand, either public or institutional consumers. The objective of this article is to explore the potential of the ornamental plant industry and its sensitivity towards price changes in the market. A survey using purposive sampling was conducted among institutional users consisting of municipalities, hotels, developers, government and private premises. Institutional consumers emphasized three aspects or key factors in making decisions on the selection and purchase of plants, which should be in accordance with the specifications and requirements of a company or institution, as well as easy to maintain. When there was more than one option that meets the criteria and specifications required, then price will be the determinant factor. Local institutions generally accept and were willing to pay the proposed price for the ornamental plants studied. Sensitivity to price changes was measured descriptively and can be seen through the average minimum and maximum price that was payable, which differed for each ornamental plant. The percentage increase or decrease mirroring their acceptance occurred when the price changes. Acceptance towards the price was highest for dendrobium horn-type orchid while the lowest acceptance was for the mini plant, Piper porphyrophyllum. Generally, all the plants were well accepted and can potentially be used in large scale by all institutional users, although findings indicated there was a tendency of higher usage potential in airports and municipalities for interior decoration and landscape beautification.

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