State Of The Industry: What Keeps You Up At Night?

State Of The Industry: What Keeps You Up At Night?

A grower’s list of concerns these days is a long one. From poor spring weather and disinterested consumers to increasing government regulations and succession plans, growers have more weight on their minds than ever.

But as stressful as rainy spring weekends and wondering whether your kids are willing to handle the load of your business, the issue keeping more growers up at night than any other is, perhaps no surprise, the economy.

“I sleep well but the economy is my number one concern,” says Steve Free, Grass Creek Greenhouse. “In the past, I felt our industry was relatively recession proof, but growing federal debt and the current administration’s intent to raise taxes troubles me.”

In our annual State Of The Industry Survey, we asked growers to rate their level of concern about a list of 10 topics on a scale from 1 to 5, with 1 being not concerned at all and 5 being extremely concerned. More than half (53 percent) of the growers who responded indicate they are extremely concerned about the economy.

The weather and government regulation are topics that have at least 25 percent of growers extremely concerned. The seven other topics we listed–1) grower consolidation; 2) access to credit; 3) production issues; 4) immigration issues; 5) succession planning; 6) a changing customer base; and 7) importing diseased cuttings–also are concerning, but nowhere near the level of the economy.

“The economy is important to all of us,” says Brian Kanotz, Callaway Gardens. “The weather affects everything even in the greenhouses, so I am constantly watching it. Consolidation affects what I can purchase and from whom. This often requires me to change what I would normally purchase and avoid some growers.”

Adds Richard Warner, Gray Squirrel Farm: “It’s not all about access to credit. You need the sales, and consumers right now are buying only the necessary items and no more.”

A Grower’s Outlook

Kube Pak co-owner Bill Swanekamp agrees the economy is a challenging one. In fact, he says it’s unprecedented because every other recession he’s experienced has been more predictable. This one, however, is a new beast.

“I have been sitting at this desk for 40 years,” Swanekamp says. “I have watched numerous recessions and downturns in the economy, and we’ve seen the economy come back each time. But it just seems to me this downturn is different from others. I think it’s because of the collapse we had in the financial markets and the entire housing industry, with the loss of the manufacturing sector in our country.”

Swanekamp believes the housing market could eventually get a boost, and that boost, in turn, could result in more business for growers. Still, growers expecting the glory days of the 1980s and ’90s to return once this economic cloud fades are probably too wishful. For today’s industry, Swanekamp says, is a different industry.

“In 1991, we had a huge glut of poinsettias on the market,” he says. “Growers threw away a lot of poinsettias. The next year, we cut back and it worked itself out. It took a couple of years, but things got back to normal.

What Else Is Keeping Growers Up At Night?

In our State Of The Industry survey, we asked growers which industry issues keep them up at night most. The economy was the runaway winner that keeps growers tossing and turning, but other issues like government regulation, immigration and consumer spending are weighing heavily on grower minds. Here’s what a few survey respondents say worries them:

“Immigration will always be a problem until our Congress fixes this perennial issue. Due to its inherent nature as being considered unglamorous, as well as low wages, our industry has great difficulty attracting talent.”–Jim Pugh, American Farms

“Having access to quality cuttings and liners, and having them arrive as they are advertised. Without some type of self-governing follow through to guarantee liners and cuttings are disease free, it costs the greenhouses a lot of money to produce cuttings only to find out later there was an issue with them. Not to mention the possibility of a spread throughout your growing range.”–David Holley, Moss Greenhouses

“Loss of independent customers as they continue to get beat up by the boxes. Loss of customers as they age. The next generation not gardening or decorating. How valuable are we in the grand plan of their lives?”–Ed Fairweather, Wessels Farms

“I just don’t see that happening this time.”

Part of the reason why Swanekamp is unconvinced the industry will return to its “glory days” is because we’re in an era in which growers are trading market share with competitors rather than building market share of their own. When one grower goes out of business, a dozen or so growers react to secure that business.On top of that, growers argue there has been too much production taking place over the last few years and nowhere to unload it.

Growers eventually learn from the market, though, and their recent experience with poinsettias is a classic example. According to Swanekamp, one major poinsettia producer told him the number of unrooted cuttings it produced is down 5 to 10 percent this year.

“That means that’s how much less was produced,” Swanekamp says. “That’s a reflection of the market. Fifteen years ago, on Oct. 30, we would be pre-booked on our entire crop. This year, on Nov. 30, we still have 40 percent of our poinsettias. There is so much material out there. Retailers can just call up and say, ‘I need these now.'”

More proof poinsettia growers are in a new era is the big-grower approach of simply striving to cover overhead costs. Making a profit with poinsettias isn’t a goal for everyone, and it’s that attitude that is driving growers away from the crop–at least the commodity, non-specialty items.

“Everybody’s being enticed with discounts,” Swanekamp says. “You see it at the consumer level, and it’s a mentality that’s drifted up the chain.”

The keys for success with poinsettias now–and all crops, for that matter–are developing niche products and making a commitment to marketing.

“At least put a little money into marketing,” Swanekamp says. “For us, the area we’ve put more money into is trade shows and visiting customers. For our trade show, it’s primarily focused on our starter plants, plugs and rooted cuttings.”

Leave a Reply

2 comments on “State Of The Industry: What Keeps You Up At Night?

  1. Reality. Typically I think thing will always improve. But in the past three years, we lose more, and more independent garden center customers through attrition. No new ones starting up to replace them, looks like another lean year. People do not buy extra plants when they are behind in their bills, or underwater. Consolidation only proves the slack demand, otherwise they would building, not selling out to payoff their debts. With the big boxes cutting out ninety percent of the local medium wholesalers, sent us back to the drawing board. The buy fresh/buy local movement helps. Retail at farm markets looks to be stable growth, lots of one on one, lots of late nights.

  2. Reality. Typically I think thing will always improve. But in the past three years, we lose more, and more independent garden center customers through attrition. No new ones starting up to replace them, looks like another lean year. People do not buy extra plants when they are behind in their bills, or underwater. Consolidation only proves the slack demand, otherwise they would building, not selling out to payoff their debts. With the big boxes cutting out ninety percent of the local medium wholesalers, sent us back to the drawing board. The buy fresh/buy local movement helps. Retail at farm markets looks to be stable growth, lots of one on one, lots of late nights.

More From State of the Industry...
PP&L CAST 2015 intros

April 22, 2015

6 Breeding Companies Serve Up New Varieties At Pacific Plug & Liner

Pacific Plug & Liner’s theme this year, Labyrinth, a conservatory of the world’s most captivating plants, was perfectly topped off (pun intended) with fascinators for the women and newsboy caps for the men. The PP&L team dressed their part to act out the gothic “conservatory of the world’s most captivating plants.” Truly, the displays looked like they practically popped out of a catalog, and the costumes were a nice touch. Retailers take heed, the fully merchandised displays at Pacific Plug & Liner are worthy of emulating. We’ll let the pictures tell the story of all the fabulous variety introductions presented at  Pacific Plug & Liner’s 2015 California Spring Trials, where Cultivaris, Cohen Nurseries, Histil Nurseries, Jaldety Nurseries, Southern Living/Sunset Collection and Pacific Plug & Liner all highlighted their 2016 introductions.  

Read More
Speedling 2015 CAST intros

April 22, 2015

Speedling Inc. Presents New Varieties From ABZ Seeds, Hem Genetics, Thompson & Morgan, Vista Farms & PSI

You name it, we saw it at Speedling's California Spring Trials location in San Juan Bautista, where five companies showed off their new introductions for 2016.

Read More
PittMoss on Shark Tank

April 22, 2015

PittMoss Wins On Shark Tank

Mont Handley, president and CEO of PittMoss, appeared on ABC’s Shark Tank on April 17 to try to get the “sharks” to invest in his peat moss alternative. Three investors from the TV show contributed $600,000 to PittMoss for a 35 percent stake in the company. Check out this clip from ABC’s website in which Mark Cuban, Kevin O’Leary and Robert Herjavec discuss getting on board with the product. PittMoss is an alternative to sphagnum peat moss, made up of a mix of proprietary additives and recycled paper rescued from landfill space. Handley founded the Pittsburgh-based company in 1994. What started as a small experiment grew into a full-fledged business with the help of funding provided by an EPA SBIR grant and Pittsburgh’s Idea Foundry. Today, PittMoss is available to commercial greenhouses and nurseries from Michigan to Maine to North Carolina, with plans to grow. To learn more, visit PittMoss’ website, or check it […]

Read More
Latest Stories
HRI logo

April 8, 2015

Horticultural Research Institute Accepting Scholarship …

The Horticultural Research Institute (HRI) is offering seven scholarships for the 2015-2016 school year, totaling $20,000. Applications will be accepted through May 31.

Read More
protecting bees and pollinators video

March 31, 2015

New Video On Protecting Bees And Pollinators Educates H…

A new educational video that provides information on the horticultural industry’s essential role in bee and pollinator stewardship is one result of industry collaboration by the Horticultural Research Institute, AmericanHort, Society of American Florists and the American Floral Endowment. “Protecting Bees & Pollinators: What Horticulture Needs to Know,” narrates the current state of bee and pollinator health, provides information on factors that impact pollinators and the environment and underscores the beneficial role horticulture plays in providing healthy pollinator ecosystems.

Read More

March 25, 2015

NASS Reports U.S. Honey Production Was Up By 19 Percent…

Honey production in 2014 from producers with five or more colonies totaled 178 million pounds, up 19 percent from 2013, according to a March 20 report from the USDA's National Agricultural Statistics Service (NASS).

Read More
cultivate'15 logo

March 4, 2015

Cultivate’15: AmericanHort Announces What’s…

In an industry that has seen major changes occurring at a fast pace, many industry professionals leave Cultivate with their heads spinning and no clear idea of how to regroup and strategize. Cultivate’15 is “Changing the Game.” As this year’s focus, Changing the Game will call your attention to the ways in which our industry has changed and your opportunities to compete successfully.

Read More
Greenhouse Grower State of the Industry

February 2, 2015

Download Greenhouse Grower’s 2015 State Of The In…

The Greenhouse Grower 2015 State Of The Industry Whitepaper includes all the results of the survey, including comparisons on 2014 sales to past years, details on how 2015 production volume and prices will compare to 2014, crops that growers will increase and decrease production on, where growers stand on using neonicotinoids on crops, how many growers will pursue growing medical marijuana and more.

Read More

January 27, 2015

Benchmarks: Let’s Change Our Story

It's a new year. Time for our industry to change how consumers perceive plants by creating a new reality where plants are valued for more than their physical beauty.

Read More

January 21, 2015

AFE Wins Platinum MarCom Award For “Murder, Sex a…

The American Floral Endowment (AFE) took home its fourth award for the animated awareness video "Murder, Sex and Greed." The organization also recently announced that there are two new members on its board of trustees.

Read More
Greenhouse Grower State of the Industry

January 19, 2015

2015 State Of The Industry: Current Green Industry Tren…

Demand for green industry products and services is forecasted to increase in coming years as the housing market rebounds.

Read More

January 14, 2015

Terra Nigra Joins DNA Green Group

DNA Green Group will be expanding its range of cut flowers by incorporating Terra Nigra, a company specializing in breeding and propagation of gerberas and roses.

Read More

January 14, 2015

Florensis Receives Horticultural Entrepreneur Award

During the January 7, 2015 award ceremony in the Keukenhof, in Lisse, Netherlands, Florensis received the Horticultural Entrepreneur Award. Florensis was one of four nominated companies, which also included Arcadia BV, Artemis and Martens Asperges.

Read More

January 9, 2015

AmericanHort Celebrates Its First Birthday

AmericanHort was formally launched one year ago on January 1, 2014, and the association is celebrating numerous successes of the first year.

Read More
Carol Miller

January 7, 2015

We’re All In This Together

Growers and retailers have a common goal — to serve customers better. In this new column, Greenhouse Grower will take a look at ways growers and retailers can work together to take advantage of profit opportunities and better meet customer needs.

Read More

January 7, 2015

Industry Speaks Out Against “Waters Of The U.S.” Rule

The Environmental Protection Agency’s proposed rule change to the Clean Water Act, known as “waters of the U.S.,” has the potential to disrupt normal business practices for growers across the country.

Read More

January 7, 2015

Students Tackle Real-Life Challenges At National FFA Fl…

Top prize winners put skills learned in the classroom to the test at the National Future Farmers of America (FFA) Floriculture Career Development Event.

Read More
Lesley Judd

January 7, 2015

2014 Meister Scholarship Awarded To Ph.D Student

The Richard T. Meister Scholarship was awarded to Lesley Judd, a graduate student with a passion for horticulture and a desire to pass her knowledge along through teaching.

Read More

January 6, 2015

39th Annual Today’s Horticulture Symposium Will Be Febr…

The Professional Gardener Alumni Association (PGAA) will hold the 39th Annual Today’s Horticulture Symposium program will be on February 6, 2015 from 8 a.m. or 4 p.m. in the Ballroom at Longwood Gardens, and will feature an array of engaging speakers.

Read More
Shawn McBurney

January 6, 2015

Society Of American Florists Hires New Lobbyist

Shawn McBurney joined the Society of American Florists' (SAF) staff starting January 5 as the new senior director of government relations.

Read More
Greenhouse Grower State of the Industry

January 5, 2015

Growers Are Optimistic For A Strong Year In 2015

Greenhouse Grower’s State Of The Industry survey reveals that growers are being cautious about the inputs they use, and they’re worried about input costs and regulation, but enthusiastic about the rebounding economy.

Read More