BenchPress Profile: Peter Konjoian
July 7, 2008
Of all your different hats — grower, scientist, educator — which of them are you wearing most these days?
"At this point in my career, I'm spending less time in the greenhouse and more time on the side of education. A torch that I decided to start carrying is that of speaking of profitability and helping fellow growers understand what profit margins are all about. Over that time, I've become a student to agricultural economics. Charlie Hall, [holder of the Ellison Chair in International Floriculture] at Texas A&M, and I are going to be doing a little bit of work together on this topic. We're going to try to bring this message to growers: Why are we having such trouble raising prices as an industry? My opinion is we have learned to grow plants much faster than we learn to sell them as an industry. Economists tell us we may be oversupplying the marketplace. If we're going to raise prices, we need to trust that law of economics of supply and demand, and take a hard look at how much we're producing."
What specific concerns are growers expressing to you these days?
"I'm finding that larger wholesale growers are holding their own and they're doing well because the mass market side of the industry is the one expanding. It's the growers who are strictly retailers, or those medium-sized operations who are doing some wholesale and some retail, who I'm more concerned with. There are more of those medium-sized wholesalers who traditionally were just wholesalers, and they're now trying to open a retail outlet to grab more margin. That, in turn, kind of oversupplies the garden center and independent segment. I think the farmer mentality is to grow more, grow more and get more profit. I think that's where we are right now. These guys are seeing narrow profit margins, and their gut is telling them to grow more. That's not the answer. It's really grow less, so we can limit supply and prices will naturally rise."
What can you tell growers who struggle to sell a good portion of their crops?
"I see way too many growers concerned with the cost of the pot, flat, growing mix or plug. They should be much more concerned with whether the shrinkage rate is 10, 5 or 3 percent. The numbers that we run in research in this area are mind boggling, if they would only pay attention. You make much more back on your profit margin by minimizing the waste than you do trying to negotiate with a supplier over a fraction of a penny per pot. There are way too many growers who are focused on that side. I'm not saying they should not try to minimize their costs, but they turn a blind eye to what goes out the backdoor of the greenhouse. During an upcoming Short Course session with a colleague, we're going to be talking about shrinkage as a silent assassin."
What other discussions are you looking forward to at this year's Short Course?
"Water management. I'm involved in a group called the Water Education Alliance for Horticulture, led by Paul Fisher at [the University of] Florida. What we're building is an academic- and industry-based alliance that will bring all of the companies dealing with water treatment and water management together. They're supporting the project, and it's allowing us to take a step forward because we haven't had to really concentrate on water treatment and management before. Growers are too comfortable with pouring out a lot of water overhead. We need to change that."
Are you still finding new uses for Florel today?
"As we continue to learn about plant hormones, and in particular as we continue to understand ethylene and its role in the plant better, we keep uncovering beneficial effects of this hormone. It keeps on trucking, and we've got a session at this Short Course on Florel. We have a couple of new applications to talk about at Short Course, and there's a nice aspect of this that I think is going to fit into our next cycle. I think it's a nice year to bring Florel back into the discussion."