Singing Over Spring?

Singing Over Spring?

Was spring a success or a failure for your greenhouse operation this year? Your answer, of course, depends on your definition of “success” and the goals you set for your operation months ago.

Did you have your sights set on sales increases of 10 percent over 2008? Five percent? Perhaps your goal simply was to survive the season and ride out the recession so you’d be in position to give spring yet another shot in 2010.

However you define success, the growers who took our Industry Pulse Follow-Up survey in June tend to agree Spring 2009 was a good one. Eighty-six percent of survey respondents called spring a success for their business this year. Only 14 defined it as a failure.

So what made spring a success for so many? Many respondents attribute their success to the boom in herbs and vegetables. Among those who grew them this spring, 34 percent report sales increases of more than 10 percent in the crop category. Another 22 percent report sales increases between 5 and 10 percent, and only 4 percent of respondents report sales decreases from 2008 to 2009.

“Herbs and vegetables seemed to have a big appeal to the 30-and-under crowd, a group our industry has struggled to attract,” says Janet Kister, a grower who co-owns Sunlet Nursery in California. “This may prove to be the spark that excites our next generation of gardeners. If they’re successful with edible gardens, they may have enjoyed the experience and want to graduate to bedding plants and beyond.”

Ornamental bedding plants also fared well this spring. Among the respondents who grow them, 18 percent report similar sales in 2009 as 2008, and 42 percent report sales increases.

Sales of container perennials and flowering potted plants this spring also mirror 2008 sales. Twenty-five percent of growers report similar sales of container perennials this spring as 2008, and 24 percent report similar sales of flowering potted plants. Growers reporting sales increases this year outnumbered growers reporting sales decreases in both categories.

Digging Deeper

As a whole, when we asked growers how Spring 2009 sales compared to Spring 2008 sales, the majority (20 percent) reported sales increases between 5 and 10 percent. Sixteen percent of survey respondents report sales increases of more than 10 percent, and another 16 percent report same sales for the two springs.

Only some growers had spring sales increases, though. Thirty-seven percent of respondents report sales decreases, and nearly half of those reporting decreases report decreases of more than 10 percent.

Clearly, there were winners and losers this spring. There are every year. But the success and failure of growers may have been more extreme in 2009 than past years.

“February and March is when the recession started to sink in with the consumer,” says Ed Van Wingerden, a grower who owns Ever-Bloom in California. “They panicked and stopped spending. Once ‘thrift fatigue’ set in, they opened their wallets again. The economy is not better today than it was in February or March, but now that the consumer realizes the sky is not falling after all, they are back to buying flowers.”

The economy was indeed a major challenge for growers this spring. Thirty-nine percent of survey respondents say it was the biggest challenge they faced this spring, but the economy was not the biggest challenge facing growers. That distinction goes to the weather, which 55 percent of growers reported as their biggest spring challenge.

“Our industry is greatly affected by weather,” says Bill Swanekamp, a grower who owns Kube-Pak in New Jersey. “Because the weather in the Northeast was so bad this spring, it is hard to say how much, if any, the economy [affected] sales.”

Based on a review of our Weekend Weather Updates, featured weekly throughout spring on GreenhouseGrower.com, weather in the Northeast was generally comparative to the Midwest, Southeast and Southwest. The weather was “average” in all four regions, and we calculated the weather as “above average” in the West.

Opportunities

In addition to questions about spring challenges and spring sales, we asked growers two open-ended questions about opportunities − the biggest one they capitalized on and the biggest one they missed. Of the 97 respondents who listed an opportunity they capitalized on, 32 percent directly mentioned or referred to herbs or vegetables as the biggest opportunity they cashed in on.

Herbs and vegetables were also mentioned directly when we asked growers about the biggest opportunity they missed. The resounding sentiment was, however, somewhat positive, as herbs and vegetable growers say they could have grown more of both.

On the whole, most growers met consumer demand for their products, be it vegetables, bedding plants or another crop. Eighty-three percent of growers report growing enough to meet consumer demand this spring, whereas only 17 percent report not growing enough.

A couple other interesting survey finds:

– When growers were asked where they had the most sales growth this spring, the majority (29 percent) say at independent garden centers. Another chunk (28 percent) saw the most growth at their own retail shops.

– When growers were asked where they had the most sales decline, the majority (23 percent) say with other growers. Another large percentage (19 percent) indicated they experienced their most sales decline with independents, and 14 percent experienced their most at the mass merchandisers.

We also asked growers whether they believe our industry is and always has been recession proof. The result: 59 percent say no, and several growers elaborated on their answer. Alice Longfellow, a grower-retailer at Longfellow’s Garden Center in Missouri, was one such grower.

“I believe we used to be recession proof, but not today,” she says. “So much of our business is dependent upon the sale of large, specialty items and people did not buy them as much this spring.”

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