Nortex Wholesale Nursery is a family business–has been for more than half a century. Ralph Pinkus started a retail operation in 1951. Ralph’s son, Jon Pinkus launched a growing operation in 1972. And John’s son, Aaron Pinkus, joined the company seven years ago, and moved into the position of vice president and general manager three years later. Nortex’s employees are like family, too, with some working there more than 20 years.
Sometimes, that much tradition in a family business can stand in the way of progress. That’s not the case with this Wylie, Texas, greenhouse operation and its young general manager, however. A new generation means new ideas, and Aaron Pinkus has plenty of them.
In the last few years, Pinkus and Nortex–a finalist for Greenhouse Grower’s 2009 Grower of the Year Award–have reworked the operation’s product mix, targeted new customers, upgraded facilities and devised new marketing plans. And they’re not close to being finished.
Not Standing Still
Aaron Pinkus aggressively looks for new opportunities. One of his first big decisions was shifting some of the company’s production from bedding plants to the premium color market. The goal was to appeal more to high-end retailers looking for a better quality product. “A few of our greenhouses have a very high overhead. We wanted to do more crops with a higher gross margin to improve our profitability,” Pinkus says.
Nortex upgraded facilities as well. The first step was adding more space tailored for those premium bedding plants. It also expanded with some more efficient greenhouse space, enabling the company to expand its business with local landscapers. Next, the company added a new propagation house to free up valuable square footage in existing greenhouse space. In the last year they have also added additional outdoor production area and updated irrigation and heating systems. Upcoming projects include another 2-acre expansion and adding barcoding equipment to the line.
The marketing budget will get a bump for 2010, too. Last year, Nortex spent most of its marketing dollars promoting its Blue Label Herbs program. Approximately 1.5 percent of herb sales went toward marketing the brand. That number will increase to 3.5 to 4 percent this year.
“In the past we’ve passed on some opportunities primarily because we were concerned about our return on investment,” Pinkus says. “I’ve learned if you’re going to do it, you have to do it right.”
Some of the increased investment will go into marketing materials targeted directly at consumers. Timely information will run on the company’s own consumer-facing BlueLabelHerbs.com website. POP materials with recipes and other uses for herbs will also be placed in retail locations throughout the season.
The Blue Label Herb program is indicative of the direction Pinkus sees the industry heading. “I think one of the big trends in the industry over the last five or 10 years has been branding. A lot of breeders have built some very nice brands and they market them really well,” he says. “Ball’s Simply Beautiful program, for example, is probably the best one we’ve come across as far as being designed well for our area.”
In fact, with the success of Blue Label Herbs, Pinkus thinks branding is something Nortex might do more of itself.
“We work hard to find crops that grow really well in our area,” he says.
Focus On The Independent
Pinkus says the relationships that have helped build the Blue Label Herbs brand are possible because of the type of customer Nortex chooses to serve: independent retailers who look for just that type of differentiation. “We don’t sell to the boxes,” he says. “We sell only to independent garden centers like Calloway’s Nursery, North Haven Gardens, and Redenta’s, and some smaller independents like Covington Nursery or Puckett Nursery.” Higher-end retailers like Whole Foods and Central Market are also key customers.
That focus on the independent has allowed Nortex to carve out a niche as a grower who is eager to try new things for its customers.
“We try to be unique in that we grow a lot of different varieties,” Pinkus says. “That’s been requested by the retailers and it’s become part of our reputation.”
Retail customers have a lot of input into what Nortex produces. The sales staff talks with customers all season long, getting feedback on new plants and ideas. They walk with retail customers at trade shows and at the Dallas Arboretum Trial Garden, making note of what catches their eye. Pinkus works with his growers to see if those suggestions make sense to try locally.
Nortex also keeps good records on its customers, making note of what they’ve bought and how it sold for them during the year, Pinkus says. “A lot of the smaller companies we choose to deal with don’t have really good computer systems that tell them what they’re doing well and what they’re not doing well. We try to help them with that where we can.”
That kind of communication has helped Nortex develop an extremely trusting relationship with its customers. In a sense, their retailer customers are part of the Nortex family, too. “We are able to discuss, very openly, successes and failures. It’s a privilege to be able to go to a customer and be able to help them in a different way than just the product you sell them. We work hand in hand with a lot of our customers and I think that is one of the big reasons we’ve been so successful in the retail market.”
Those relationships have obviously paid off. Despite the concerns about the economy, 2009 was a record year for Nortex.
“Everything went smoothly. We increased sales 8 percent over 2008 and our profitability was considerably higher than the year before, too,” Pinkus says.
Sales representative Frank Trevino echoes Pinkus’ sentiment. “Some of our larger customers were slower, so we had extra material. We were able to move it with new, smaller customers we hadn’t done much with in the past. We have actually increased production a little bit for next year because of that. They’re small but they can move quite a bit of color in the height of the season.”
And although some cool, rainy fall weather got Nortex’s current season off to a slow start, Pinkus says he expects the positive trend to continue this year.
“We have an ambitious plan for spring. It looks like we’ll increase our landscaper business significantly. I also expect an increase with the retailers we picked up last year once we’ve developed a reputation with them as being able to deliver quality when they ask for it. I have high hopes for this year.”