Nursery Service Program Review

Over the last six to eight years, third-party nursery service has developed extensively in the mass market arena, particularly at The Home Depot and Lowe’s. More recently, as in this year, Wal-Mart also has begun to test the concept in select markets and will be studying the results to see if the program bears expanding, maintaining or is deemed unnecessary.

The great debate begins as to why programs such as these would be necessary. After all, doesn’t it seem logical that mega-retailers are much more capable logistically of efficiently hiring and training staff to order, maintain and merchandise live goods? Apparently, the answer is they are more than capable of doing this, but it’s obviously more easily said than done.

Massive store growth amongst Wal-Mart, The Home Depot and Lowe’s has contributed to a talent shortage of live goods experts in their stores at this time. This is not to imply that many of their stores do not have high-performing, expert individuals that can drive business, but I know from my own experience in 15 years at The Home Depot that this was much less the case in 2005 than it was in 1995. Early in the ‘90s, almost every store Home Depot opened had experienced garden experts from the nursery industry to run these departments. This was easy when there were 50 to 100 stores, not 300 to 400 stores.

These high-performing individuals could make a huge, quantifiable difference in same-store sales versus similar volume stores in the same market without such individuals. When I say huge, I mean in the hundreds of thousands of dollars in live goods sales. This is not to mention all the related high-margin goods that will accompany these sales. These folks made the retail shopping experience exciting for the consumer. They created a sense of urgency in the shopper that would keep them guessing about what would be on display on their next trip into the stores.

Folks like these would be or are horrified with the current service formats. They feel they have lost control of the ability to be entrepreneurs in driving their store’s business and in most cases they have, particularly with pay-by-scan programs. The problem seems to be that there were less of these talented and specialized folks populating these retail outlets and mega-retailers were forced to be pro-active about maximizing the ability to merchandise this perishable live goods category properly. 

Service Program Selection

Service programs come in several formats. In the first format, the live goods suppliers provide their own service for their own products. This method is the current standard for most bedding plant suppliers who are selling to mass market retailers. It is by no means new and was initially developed in the Sunbelt markets right along with guaranteed sale programs on mainly color products. Service became necessary for the suppliers to protect their profits.

This method of service program really mushroomed with the onset of single-source suppliers of annuals into big box stores. Going back some years, most retailers would buy selective products from different growers in an effort to "cherry-pick" the best product mix and quality at any given time. If multiple vendors had service programs, this would create territorial battles at the retail stores with survival of the fittest (or craftiest) winning the retail square footage battle.

This is the preferred method of service program in today’s retail pay-by-scan environment. It seems to make a lot of sense that if you, as a supplier, own the inventory and are responsible for its maintenance, that you would have your own folks on staff to make sure product is merchandised and maintained properly.

Suppliers who provide this type of service basically have either built it into the cost of the plants to the retailer or they are able to bill out separately for services provided while maintaining more competitive costing on the live plants they are providing at retail.

Now that these types of programs are well entrenched across retail, many of the suppliers who provide the services (particularly pay-by-scan suppliers) are looking to expand or extend product mix to more effectively leverage the costs of these programs across their enterprise. Some bedding plant suppliers now are considering supplying and servicing woody ornamentals in some big boxes. 

Third-Party Service

The next main service format is third-party service providers. These would include such entities as Stinchcomb Associates, ICS, RPS and Quick Turn to name several. This type of program is either funded centrally by the retailer or jointly by live goods suppliers contributing to a revenue pool, or even some combination of both. Typically these service providers will service woody ornamentals including trees and shrubs. They may be involved with perennials and tropicals in some cases around the country or with certain retailers. They also will provide the service for the bedding plant categories.

This program, while not intending to displace what passes for nursery help in the stores today, by and large has become just that from my viewpoint based on in-store visits mainly in the Northeast part of the country this spring. One of the inherent problems with any service provider in mass retail today is the threat of store personnel assuming that these providers are the sole source of service provided for these categories. Instead of having a synergistic effect that could possibly take the retailer to new heights, service providers are sorely tested to perform at high levels with limited resources.

The problem here is one of simple mathematics. The revenue pool available currently without building too much into the cost of these plants may allow 20 to 40 hours per store per week only in the busiest of seasons such as April and May. Effectively merchandising these departments would take a minimum of 200 hours per week, in my opinion. This includes merchandising, signing, unloading and packing out and watering. There is a huge variance in what is provided and what is needed to be performing at high levels. Retailers who aren’t aware of this gap are suffering from poor customer perception. Store operations can either work as partners and greatly enhance these relationships or can be narrow-minded about the category and limit their current and future potential, and worst of all, lose market share for their retail site.

From my history, a retail buyer or manager will never be completely satisfied with the performance of third-party service providers, no matter how hard they may try. Suppliers who may be funding either fully or partially are also typically very hard to please and seem to always have some type of contentious relationship with these providers. It has to do with feeling like "you’re getting your moneys worth." Quite often they do and there are many times when they don’t.

Store service programs look like they are here to stay. Retail presentation has radically improved, in most cases as a result of these programs. Big box retailers can have their cake and eat it, too, if they convince their operators at store level to partner with these providers and not defer everything about the program to them. My vision as a Home Depot merchant was to have the service provider execute many (not all) of the tasks at hand in unpacking plants off of racks and on to tables, signing the product and perhaps watering the plants. At the same time, my belief was that all of the displaced hours injected into the system would lead to the most unbelievable customer service ever provided with apron-wearing associates literally swarming over the customers. Unfortunately, this was not the case in the majority of situations. If this tide can be changed, then and only then will the independent garden centers have anything to worry about.

Leave a Reply

More From Marketing...

May 22, 2015

Nexus Greenhouses Is Optimistic For Expansion Into New Markets

Cheryl Longtin and Mike Porter, who own Nexus Corporation, say they were excited to attend the grand opening of Gotham Greens’ new structure atop the new Whole Foods grocery store in the Gowanus neighborhood in Brooklyn, N.Y., when it opened in December 2013. The project is just one example of some of the new and expanding markets that Nexus Corporation has expanded into over the past few years. Jeff Warschauer, vice president of sales for Nexus, says the company has enjoyed getting to know and working with the founders of Gotham Greens, Viraj Puri and Eric Haley, and Jennifer Nelkin Frymark, the chief agriculture officer, on their innovative approach to business. “They are very excited and work hard internally – just great people,” he says. “From our perspective, it’s great to see that excitement and vision. The employees there are happy and there’s no turnover; they’re only adding new people […]

Read More
Farwest2015

May 20, 2015

2015 Farwest Show Announces Second Annual Equipment Innovation Day

The second annual Equipment Innovation Day will be Tuesday, Aug. 25, prior to the 2015 Farwest show, which will be August 27-29 in Portland, Ore. Equipment Innovation Day, which was enthusiastically received in 2014, offers a real-time opportunity to see new heavy and automated nursery equipment in action. The demonstrations take place in manufacturing and nursery settings, adding value to the showcase. Attendees will be able to talk with participating manufacturers and learn first-hand from innovative growers who use the equipment in daily operations. The day-long event will be held at the main manufacturing plant of GK Machines, Inc., Donald, Ore. Further demonstrations of field equipment will take place at the nearby nursery of A&R Spada Farms, LLC. Bus travel to and from the event is planned, starting at and returning to the Oregon Convention Center. Attendees are welcome to provide their own travel to and from the site. Preregistration is required. The cost […]

Read More
Bee On Flower

May 20, 2015

White House Task Force Releases Pollinator Health Strategy

An interagency Pollinator Health Task Force commissioned by President Obama released its “Strategy to Promote the Health of Honey Bees and Other Pollinators” on May 19. The strategy, released in accordance with the Presidential Memorandum issued last June, is accompanied by a Pollinator Research Action Plan, which outlines needs and priority actions to better understand pollinator losses and improve pollinator health. The recommended actions will be supported by a coordination of existing federal research efforts and accompanied by a request to Congress for additional resources to respond to losses in pollinator populations. Pages 47 through 52 specifically address pesticides and pollinators. The report calls out plant production, native plants, mosquito control and all urban uses in its Pollinator Action Plan. RISE (Responsible Industry for a Sound Environment) says it supports the goals of improving pollinator health and habitat contained in the White House Pollinator Task Force’s release of its National […]

Read More
Latest Stories
New Guinea Impatiens

May 14, 2015

10 Tips To Improve Retail Shelf Life Of Bedding Plants

Good-looking plants at retail lead to stronger sales and less postharvest shrink. Try these 10 ideas for maintaining quality and keeping plants looking beautiful.

Read More
GrowIt! App Wins Gold At Design100 2014 US Mobile & App Design Awards

May 12, 2015

Suntory And GrowIt! Garden Socially Partner On A New Se…

Suntory Flowers and GrowIt! Garden Socially are working together on a new photo contest that both retailers and their customers can get involved in. GrowIt! Garden Socially is a free garden photo sharing app, and the photo contest is designed to promote Suntory’s plant brands and help consumers interested in those plants find them at local garden centers. Consumers who want to enter the contest can take these four steps: 1. Download GrowIt! for free from the App Store or Google Play store 2. Sign up with a username 3. In the app, add a photo of their favorite Senetti plant 4. In the comments, tag it #SenettiRocks The first photo contest featuring ‘Senetti’ pericallis runs from May 7-18. Three entrants will win gift certificates from their favorite local garden retailer — one $100 prize and two $50 prizes. After Senetti, the next featured brand will be ‘Million Bells’ calibrachoas […]

Read More

May 6, 2015

Orange Is The New Green: An Interview With Dümmen Orang…

The day the news came out about the name change of DNA Green Group to Dümmen Orange, and everything that meant for the large flower breeding conglomerate, Greenhouse Grower Editor Laura Drotleff talked with Dümmen Orange Operations Manager Kate Santos about what the identity shift would mean for the company, its customers and ultimately for consumers. What’s going to happen to the brands and what was behind the decision to do away with those brands and consolidate? A key objective for our organization in moving to one corporate brand is to continue to stay true to the heritage and history of the individual brands that have made us what we are today and what we will build the future of our company upon. For this reason, some of those brands that have a deep-rooted history and much more recognition within the market, will have a longer persistence in our overall […]

Read More

May 1, 2015

Restoration Landscapes: A Specialized Market For Nativ…

Restoration landscapes, depending on their purpose, often require straight native species, along with a confirmation of their known provenance. Research is key in this area and good recordkeeping is a must.

Read More
Dummen_Begonia_UnbelieveableFirstKiss

April 29, 2015

Dümmen Orange Is The New Name For DNA Green Group

DNA Green Group has a new name: Dümmen Orange. The company revealed its new name, logo and brand values at all of its facilities in 16 countries on Thursday, April 23. The well-known corporate brands Lex+, Bartels, Terra Nigra, Dümmen Group, Agribio China, Agribio Colombia, Oro, PLA, as well as the production locations, are changing their identities immediately to Dümmen Orange. Other established brands like Rijnplant, Ecke, Oglevee, Red Fox, Fides, Japan Agribio and Barberet & Blanc will convert over limited time. The company’s CEO Biense Visser calls it a logical next step. “All companies that have been acquired have a rich and successful history,” Visser says. “We have always tried to respect that heritage. Doing so, we created confusion for our customers. Our employees expressed a preference for a more uniform approach to the market, too. That is why we have chosen one large umbrella brand that embraces the entire product […]

Read More

April 15, 2015

Redesigned SunPatiens Website Offers New Tools For Saka…

Sakata Seed America's new and improved SunPatiens website launched March 1, 2015 and provides growing information, marketing support, product location and many more tools to encourage consumer success with SunPatiens.

Read More
Keenland

April 13, 2015

Proven Winners Partners With Award-Winning Designer Jon…

Proven Winners will partner with award-winning garden designer, author and fine living expert Jon Carloftis on a new series of four LIFE + STYLE events in 2015. In true Carloftis style, food and spirits will be paired with inspiring architecture and innovative garden designs featuring Proven Winners plants.

Read More

April 13, 2015

New Consumer Website Makes Buying Roses Easier

A new website has been created as a resource tool for gardeners who are looking for a rose that fits their needs. This website is 100% consumer focused and will inspire confidence and promote rose gardening to the next generation of gardeners. Visitors will also find links to connect on social networks, such as Facebook and Pinterest. The website promotes roses, not specific brands, and that is what makes it unique.

Read More
Rose rosette on Knockout rose, April 2012. Photo credit: Alan Windham, University of Tennessee

March 25, 2015

$58 Million In APHIS Farm Bill Funding Will Support Hor…

Nearly $58 million as been allocated by the USDA's Animal and Plant Health Inspection Service (APHIS) to support the industry's Plant Pest and Disease Management and Disaster Prevention Program, under Farm Bill Section 10007. The program will support mitigation efforts for specialty crops, including providing research and other funding to address plant pest and disease priorities for the specialty crop industry, including floriculture and nursery crops.

Read More
National Floriculture Forum 2015 029

March 18, 2015

2015 National Floriculture Forum Focuses On Marketing I…

The 2015 National Floriculture Forum, held March 6 to 7 in Minneapolis, Minn., zeroed in on the topic of marketing in horticulture and included visits to Gertens Greenhouses and Garden Center, Bailey Nurseries, Bachman’s Floral, Home and Garden and Tangletown Gardens. The annual meeting allows greenhouse and floriculture faculty, graduate students and industry partners to meet and share updates on current research, issues and initiatives.

Read More

February 18, 2015

Range Of Nursery Inspections To Protect Patented Plants…

Plant patents are under protection, and breeders are fighting for their rights to keep growers from illegally propagating protected varieties. It's something you don't want to take a chance on, because the risk is far higher than the reward. More than 300 inspections were carried out last year from New York to British Columbia and from Ontario to Florida to protect plant patents, Plant Breeders’ Rights (PBR) and branded programs.

Read More

February 4, 2015

TPIE 2015: An Electrified Industry Vibe Boosts Cool New…

The general feeling at the Florida Nursery Growers and Landscape Association's 2015 Tropical Industry Exhibition (TPIE) was upbeat and positive. Attendees were inspired by exciting new products and varieties, as well as creative new displays and innovative ideas and left energized for the season ahead.

Read More
Costa Farms Website

January 21, 2015

Costa Farms’ Launches New Interactive Website

Costa Farms is making efforts to educate consumers while pushing horticultural digital marketing forward with the re-design of its website. The new website features a fresh design and improved navigation, as well as a plant finder that gives gardeners easy access to plant information.

Read More

January 5, 2015

Growers Are Successfully Marketing The Benefits Of Pla…

Growers who are already marketing plant benefits and gardening as a lifestyle say they think this could be the best angle for the floriculture industry to promote our products.

Read More

January 5, 2015

Plants Love You Campaign Raises Plant Benefits To Foref…

Plants make us feel good. It’s a no-brainer, backed by numerous studies, but there’s more to the story. And it’s one the Canadian Ornamental Horticulture Alliance (COHA) hopes its Plants Love You campaign will tell in such a way that it will inspire people to make plants a part of their life, and on a bigger scale. COHA is an alliance between the Canadian Nursery Landscape Association (CNLA), the Fédération Interdisciplinaire De L’Horticulture Ornementqale Du Québec (FIHOQ) and Flowers Canada Growers (FCG). Inspiration for The Plants Love You campaign came from COHA’s research, which revealed that 96 percent of consumers surveyed have a favorable attitude toward plants. When COHA delved deeper into the numbers, one thing stood out loud and clear. “It quickly became apparent that while consumers like plants because they are pretty and make them feel good, few understood the environmental and health benefits plants offer.” says Frank […]

Read More

December 9, 2014

New Website For PanAmerican Seed

PanAmerican Seed's new website is mobile-friendly and has a fresh look and enhanced navigation.

Read More
What’s a pumpulent? It’s a pumpkin planted with succulents, and it’s also one of the ways Altum’s is catching customers’ attention with new products and modern marketing.

December 1, 2014

9 Digital Marketing Resolutions For 2015

Whatever your experience with digital marketing, here’s some advice for keeping your business progressing into the new year.

Read More

November 25, 2014

Conley’s Launches New Website

Conley’s Manufacturing and Sales recently launched its newly designed website, which was redesigned to create a user-friendly digital environment for customers to explore Conley's products.

Read More