What Goes Around Comes Around
September 1, 2009 My wife’s mother often used the statement in the headline to indicate what you did in the past will come around to haunt you in the future. She was one of the kindest and most considerate people I have ever met. She worked hard, took care of her home, was a great cook and would never say a bad word about anyone. Some people were less than kind to her, but she would always say, “What goes around will come around.”
I’ve thought about her and her saying, and in the last couple of months, I’ve come to the conclusion: “Here we go again.”
In the last two to three weeks, I have read 20 to 30 business and management magazines, listened to television news and even checked the Internet to determine what the feeling is regarding our business position.
Most now acknowledge we are in a recession. With 10 percent national unemployment and almost 20 percent in Michigan, some might say that it is a depression. However, we must realize we have been the richest country in the world since our colonial days.
In an article in March’s U.S. News & World Report, Rich Newman asked, “Are we becoming a soft society afraid to fail and try again?” Let’s take a look at floriculture and the greenhouse industry to see if we are able to fail and try again.
Glancing Back
In the 1930s, our industry had a very formal market structure. There was the grower who sold to the wholesaler who sold to the retailer. Because most of the product at that time was cut flowers and some potted plants, the system was very efficient. Even though the grower thought the wholesaler was making too much money and the retailer thought the price of the product was too high, the system worked fairly well.
In the 1950s, former vegetable field growers started producing flowers and vegetable transplants. Most of these products were not sold through wholesalers, but directly to small independent stores.
I remember going to my local hardware store and seeing wooden flats of tomatoes, peppers, petunias and impatiens for sale by the plant. Most people would buy a dozen. The plants were cut out of the flat and wrapped in newspaper. At that time, the plants sold for three to five cents apiece.
By the early 1960s, the products being developed by the vegetable and bedding plant growers no longer fit into the formal marketing system. In the early 1950s, cut flowers were the largest part of floriculture with potted plants second, foliage plants third and bedding plants last.
In the last 50 years, we have made bedding plants the largest part of floriculture. Cut flower production has moved to South America. Production of potted plants has not increased greatly percentage-wise, nor has production of foliage plants.
Lesson To Be Learned
In the July 2009 issue of Time magazine, there is an article titled “What Barack Obama Can Learn from FDR.” When FDR was elected in 1932, he faced a tremendous job restoring the economy and getting people back to work. It couldn’t be done in 100 days. It took years to bring back the economic system with the guidance and help of the federal government.
FDR’s goal was to develop programs that provided security and safety for the country. He started the Social Security system and the Federal Deposit Insurance Corporation (FDIC). His administration developed plans for infrastructure, banking, the arts, agriculture, labor, the environment, welfare, housing and unemployment.
With the people and government working together, we took the country from the dark days of the 1929 stock market crash and turned it back into a strong, stable society by 1945. During this time, our country also helped win World War II at a great cost to our soldiers and at great expense to those who supported them at home.
Some people say it took seven years for the United States to recover from the 1929 stock market crash, while others say it took 25 years. Now, more than 70 years later, we have some of the same situations that existed in the early 1930s. What goes around comes around.
In floriculture we see a marketing system that looks like it’s reverted to that of the 1930s to 1950s, with growers, wholesalers and retailers, only today the large growers may also be the wholesalers. They are the ones who deal with the big box stores and use smaller growers to provide the product they can’t or don’t want to produce themselves.
Our safety net for our employees may be as poor as it was in the 1940s to 1950s. Many have lost over 30 to 40 percent of their retirement savings because of the financial disaster of Wall Street and unscrupulous bankers.
While the environment sounds like gloom and doom, we need to make our plans to not only survive but also thrive under these conditions. I have eight ideas I think might help in deciding how to survive and thrive in the next 10 years.
The Ideas
• Successful businesses are founded on need. Do you provide what people want and need? Are you able to produce it when they want and need it? Can it be done profitably?
• In times like these, your business has a chance to show its strength. If you have the right employees, they have the right skills and you have a vision of what must be done, then you have what it takes to survive this difficult economic time.
• Be original! Remember, if you have the right people and the right facilities, one original thought can be worth more than 1,000 questions asking: “What should we do?”
• Learn from experience. It is important to know that the only thing more painful than learning from experience is not learning from experience.
• Time is important. Time cannot be expanded, contracted, accelerated, slowed, mortgaged or saved. You have to use time wisely. Every minute counts. Use it or lose it! But remember, you will never get it back!
• Don’t be afraid to make mistakes. It is always discouraging to make a mistake, but it is humiliating when you find out nobody even noticed. You will try lots of things. Many will not work and fail quickly. At least people will know you are doing something, and one day you may be successful. However, you will never succeed if you don’t try.
• Let people know who the leader is. It doesn’t matter what direction you point. You need to provide the guidance and enthusiasm to let people know where you want to go and what you want to do.
• Be an entrepreneur. You are given a blank canvas and you must paint the picture. It may take many people to create the finished product, but you are the one who must have the vision of what it will look like in the end.
All these points prove what my mother-in-law, Lola Beauchamp, told me 50 years ago. We are in a recession or a depression right now. Good luck in adjusting to this part of the cycle.
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