"It has a blue flower."
Translation:Tässä on sininen kukka.
Both are correct, though I don't think there's enough context here to choose one. "Sillä on ..." indicates possession, but I think primarily for animate subjects (say, your dog was walking around with a blue flower in its mouth). "Tässä on ..." indicates (quoting from the Wiktionary entry for "olla") "possession of a feature or capability, as opposed to simple possession; almost always for inanimate subjects". This would be appropriate for talking about some plant whose flowers are blue, not some other color.