Parker will fight Flores at Christchurch's Horncastle Arena on December 15 in what will be his first fight in New Zealand since May 2017.
The 26-year-old South Aucklander has endured a challenging year, losing his WBO title to Anthony Joshua in April in Cardiff, and then losing in his next bout to fellow British heavyweight Dillian Whyte in July in London.
The back-to-back defeats have seen Parker slip down the rankings, and he will need to claim some emphatic victories by knockout if he wants to contend for a heavyweight belt once more.
But Parker has not managed to knock an opponent out since his victory over Alexander Dimitrenko in October 2016.
He faces a man who has only been knocked out once in his career in Flores. That was against American Charles Martin back in 2014 - a fight he accepted on two weeks' notice.
Higgins believes Flores is the perfect opponent for Parker if he genuinely wants to return to the top of the heavyweight division.
"Every fight has a risk, but this fight is particularly risky because of Flores' proven knockout ability," Higgins told Newshub.
"Joseph needs a test - we need to see where his head is at. If we put him against an opponent with a losing record and no knockout power, we won't learn anything about him.
"On December 15, Joseph definitely has to make a statement, and I think he should finish Flores by stoppage otherwise there will be questions asked.
"After those two massive fights offshore is he still hungry? That is what we'll find out."
If Parker loses to the lower-ranked Flores or fails to impress, then Higgins said there will be deep and honest conversations if Parker still wants to keep boxing.
"I think he should take a long break and go to the drawing board and decide does he still want to be a professional boxer.
"It will be a long hard road back if he does [lose].
"You can always come back, but the fans can be fickle at the best of times. Lots would give up on him, others wouldn't but many would."
Flores described the chance to fight Parker as a "life-changing opportunity."
"I feel like I've seen the best Joseph Parker there is. Yes, he's young, but he's in big fights over the last few years, and that takes a toll," he told Newshub.
"You can be young, but old in boxing age.
"This fight is as important to me as it is to Joseph Parker. It is a life-changing opportunity.
"I hope he's training because I don't want to hear any excuse after I beat him."
Photo credit: Photosport. Caption; Alexander Flores and David Higgins.