Profit Equals Sustainability
A business isn't truly sustainable unless it is profitable.
June 10, 2008
I’ve taken great delight in following the articles about sustainable agriculture, how we should have green roofs and reduce our use of fossil fuels and leave a negative carbon footprint.
There is an old saying that those who don’t know history will be doomed to repeat it.
Victor Hanson, scholar, quoted in Bits & Pieces, December 2007, said: "I believe there is an old answer for every new problem, that wise whispers of the past are with us to assure us that, if we just listen and remember, we are not alone; we have been there before."
I believe it is time for a little history lesson. There was little or no bedding plant industry in the United States until after World War II. At that time, field vegetable growers started to see the increase in vegetable production in California. While it was small in the beginning, by the late 1950s, production in California was a major source of vegetables.
Michigan, Ohio and other northern states saw a big decrease in their market for field-grown vegetables. Since crops in these northern states cost more to produce than it cost in California, vegetable crops were no longer grown. The point of this history lesson is if you can’t make money growing it, no one will grow it. In other words, there is no sustainability without profit.
My favorite storyteller, Hans Christian Andersen, wrote a fable that I believe applies here. It is titled "The Emperor’s New Clothes."
The fallacy of all this movement toward sustainability is that none of this can be accomplished if businesses can’t make money. If they can’t make a profit, they won’t be sustainable.
People can come and tell you what you need to do to achieve sustainability in your business. They list sustainable crop production, resource conservation and energy efficiency, ecosystem protection and integrated waste management. But they forget that this can only be done if a profit is made. No profit – no sustainability!
We must and do have social and economic sustainability. We must and do pay and use fair labor practices and also provide community benefits. We employ people who live in communities. Perhaps we also volunteer our time to help charities and provide product to support community causes.
We have worked for many years to grow quality plants, develop new varieties and species and design systems to produce better products. Our industry has a great product safety record. In my 50 years of experience, our plants have never been recalled.
I want to share with you five "Ps" that have made our industry profitable and sustainable. I would challenge anyone who wants to take any of these away to show more profitable alternatives.
Plant material, plastics, peat moss, plugs and profits are the five "Ps," the foundation blocks of our industry. Let’s look briefly at each.
1. Plant Material
When I started in the business, we took most of our bedding plants from cuttings. In the early 1950s, Claude Hope and Charlie Weddle with Pan American Seed Co. introduced a few new petunias from seed. From that humble beginning until today, thousands of new varieties have become available. In fact, if you were at the pack trials in California last year, you could see hundreds of new varieties that could become available in the next two years. I don’t know of another industry that has that variety of new material available to them each year.
Plastic containers and covering are the cornerstones of our industry. If it were not for plastics, we would not have the bedding plant industry we have today.
When I started, bedding plants, primarily vegetable plants, were sold at the corner hardware or grocery store in full wood flats with about 100 plants per flat. When you bought them, the plants would be cut out of the flat and wrapped in newspaper for you to take home. Bedding plant growers made up the smallest segment of the floriculture industry. In fact, no real flower grower wanted to be associated with these poor former vegetable growers. There were few hanging baskets and flats grown before the advent of plastic containers.
Back in the late 1950s, an engineer at Rutgers worked with Aart Van Wingerden to cover 10 greenhouses with plastic. Aart told the engineer it would only work if the material would last at least five years and cost less than 50 cents per square foot. Today, the covering of over 60 percent of the greenhouses in the United States is plastic. This development allowed many people who could not afford glass greenhouses to enter the bedding plant business.
3. Peat Moss
When I first started, we used soil mixes that were developed by English soil scientists. John Emis had a book about how to prepare them. Secret formulas were developed by growers and these were the keys to their successes. Everyone used something different. Ray Sheldrake and Jim Boodley at Cornell University were the first to develop a uniform soil mix. Their formula was a peat moss and perlite mix with the nutrients needed to grow the crop. It worked great in the eastern U.S. I tried it in Michigan and all the plants suffered from iron deficiency. Why? The pH of the water was different. Once we adjusted their nutrient charge, it worked great here, too.
It took a few years for the growers to learn how to use the mix, but in less than 10 years, 80 percent of the growers adopted this peat-lite mix. Plant losses in production due to diseases, poor nutrient management and even insects decreased by 80 percent.
I’ll never forget the day Skip Blackmore came to MSU to show me his new invention – the waffle tray. It was a basic plug tray with slits in the bottom. I believe it was similar to a 512-plug tray. His idea was to grow the seed in individual plugs and transplant them by holding a metal plunger over each cell and pushing it through to the transplant flat below.
I was very impressed with the idea, but I told him it would never work. Well, with a number of modifications, it not only worked, but today over five billion plugs are produced in our businesses each year.
So, when people ask us today how our business is, it has never been more true that we just keep plugging along!
I’ve seen people who were millionaires in our industry lose all their money. I’ve seen people who started with nothing and today are millionaires. Good growing practices, good business practices, good people practices and good environmental practices are all essential. But you need good financial practices that result in a profit as well.
I’ve seen people make great business plans with their goals, objectives and lofty ideas, but they do not have action plans or have their people involved in making the plans happen. All of this has to be put together to make a business profitable.
Finally, in Hans Christian Andersen’s fairy tale, he tells the story of two swindlers who pretended to make the most fabulous clothes in the world. They convinced the emperor that those who couldn’t see the clothes were stupid and quite unfit for their jobs. The emperor sent his prime minister to view the making of the clothes and the swindlers told him that, if he couldn’t see the clothes, he was not worthy of his job. The bottom line was that the emperor couldn’t see them either, but he didn’t want to admit it and be judged unworthy himself. So he went into a great procession through the streets without clothes. No one would risk telling him that he was naked until a child said, "The emperor has no clothes!"
I certainly hope that our industry will not lose all we have worked for in the past 50 years because someone wants to sell us new clothes!
Will Carlson is a Michigan State University emeritus professor who has devoted his career to educating growers. He also had the vision to launch Greenhouse Grower magazine with Dick Meister 25 years ago. Drop him a line at firstname.lastname@example.org.