Eight years ago, The Home Depot was hungry for variety. Its customers were looking for new plants and the mass merchandiser was looking for growers who could supply them. At the time, Henry Mast Greenhouse considered itself more of a monocrop grower, with millions of New Guinea impatiens and geraniums filling production during the spring months. A more diversified menu of plants was required to get Home Depot’s business.
“We contracted with a couple of growers in Kalamazoo I had known for 20 years,” says Tim Stiles, president of Henry Mast Greenhouses and Masterpiece Flower Company.
In Western Michigan, where you can’t throw a rock without hitting a greenhouse, setting up a contract system is a bit different than in other parts of the country, or starting with growers without horticulture backgrounds. Masterpiece Flower Company, the distribution and sales company for crops produced at Henry Mast Greenhouses, had the ability to scope out growing facilities in season, taking notes on those they’d like to do business with in the future. Five years ago, the company added a full-time field inspector, a role filled by Mike Hughes, formerly a grower at Henry Mast Greenhouse, to observe growers’ production techniques and abilities. This is now part of the process for any operation that would like to grow for Masterpiece.
Today, Masterpiece contracts with growers to fill bedding plant and indoor plant needs for Meijer and Home Depot stores in 12 Midwest states, and news on that kind of business spreads fast. So much so that growers are contacting Masterpiece inquiring about supply needs.
“When we first started, as we brought our first grower on, I’d be out in the field and in a buying position,” Hughes says. “I was always looking for other things I could buy. I’d stop in and visit, somewhat of a cold call. As time went on, through word of mouth, growers are saying, ‘Mike’s in Kalamazoo today.’ They get my number and ask me to stop over and look at stuff.”
The Right Stuff
Once a grower’s product and process is deemed up to snuff and a relationship is established, a weekly schedule spreadsheet for the season is set up, based on sales forecasts. The grower is given a spec sheet that supports every crop, including information on pot size, type of tag, weights and measures information and varieties.
“We do give some latitude on a bedding plant crop,” Stiles says. “They may grow two series of impatiens or they may want to experiment with a new series of marigolds. We’re all right with that. We encourage that kind of experimentation.” When numbers and prices are agreed on, Masterpiece signs a commitment form.
“An attorney might say it’s an intention to buy, but it’s not a contract,” Stiles says. “We place a great deal of trust in our contract growers and likewise they place a great deal of trust in our company.” These agreements are renewed from season to season. When production starts, Hughes visits growers about twice a week, taking pictures from the young plant level up.
“Probably unlike many contract growers, we let them purchase their own inputs,” Stiles says. “That’s beginning to change, though, driven by economies of scale and the need to coordinate marketing programs.”
Growing is a family thing for the Kloosters. Mike Klooster of Great Lakes Greenhouse and Steve and Don Klooster of Klooster Greenhouses all grow for Masterpiece. Mike estimates that 2Ã¢Â�â€�3 of the growers in his area are growing for another distributor. These relationships let growers be growers and help them hook into a larger growers’ conduit into retail chain stores.
“We don’t see Masterpiece as being the impediment to higher prices or profits,” Mike says. “They’re working well to facilitate both sales and operations. There’s always the competition at store level for prices from one chain to the next. Masterpiece is quite efficient at what they do and that’s good for me.”
Mike describes himself as a life-long contract grower, working with the Kalamazoo Valley Co-Op before growing for Masterpiece. Many of Masterpiece’s contractors are second- and third-generation growers.
“Some people might say our growers have a lot of old habits,” Stiles says. “I guess we all come with that. However, that’s something I think has been a strength for us â€” having that kind of production experience within such a short distance from us.” While contract growers no doubt learn and benefit from Masterpiece’s expertise, there’s learning going on all over.
“They teach us things, too,” Stiles says. “We don’t have a lot of group meetings, but we have a lot of information sharing between growers and our sales staff. We encourage the contractors to work together and go to each other’s greenhouses. We’re their customer and they’re competing for our business, but yet, as they’ve gotten more established with us, there’s a greater sense of security.”
Information sharing and industry experience allow contractors to become specialized monocroppers themselves, which allows easier and more efficient crop management and recropping. It also makes for easier shipping. Growers are responsible for delivering shipments to the Masterpiece warehouse.
“They may pack four to five semi loads a day, some even 10 loads a day,” Stiles says. “And they’re not super large greenhouses. By being large monocroppers, they’re able to really efficiently pick up a lot of material at one time and send it in.” Once crops arrive at the warehouse, they are inspected one last time for tagging, correct retail signage, bar code compliance as well as size and maturity of the plant. Stiles says maturity, being a moving target, is what causes the most problems in the warehouse.
“We’ve rejected some materials from every single grower who has grown for us, not always because it’s bad quality, but for poor assortment or poor development,” he says. “It’s shipped too young.” When working in a pay-by-scan system, crop quality and timing is not negotiable. In this system, Stiles says Masterpiece can manage its own store inventories. Items can be substituted and Masterpiece can fill its stores with only the crops that are ready.
“We never let that commitment schedule drive our decisions,” he says. “We let the crop itself drive our decisions. If the crop is early and the weather is right, we push the crop out.” At the end of each season, Masterpiece sits down with growers to review and evaluate performance. The contractors are also encouraged to give feedback to Masterpiece on how the season went.
“About 75 percent of the grade they receive is solely based on the quality of the plant material they are producing,” Hughes says. “We put a very high percentage on what they’re producing because there’s a direct correlation, a reflection on what we put in the store versus what is selling.”