View: A Positive Outlook On 2009

View: A Positive Outlook On 2009

Al Zylstra, a TrueLeaf Technologies national sales manager based in California, can see the light at the end of the tunnel. He believes the economy is on the upswing and that growers and garden center retailers should be prepared to pounce on the opportunities ahead.

And The Economic Reality Is?
 
Recession. Depression. Economic adjustment. Financial meltdown. Conflagration of Wall Street and financial industry greed. Housing market bubble bursting. Deleveraging. Or, whatever it is you want to call it! How much longer will it last? What can growers expect this spring?

I’m going to go out on a limb and hereby prognosticate that we will soon see that we’ve already hit the bottom of the trough, and that we have already been bumping along the bottom for a few weeks or so. After another month or so, we will begin the slow, initially jerky but none-the-less steady rise back to economic normalcy–whatever that actually is.
 
So, you heard it here, and if it proves true, remember that! If not, well, you should read the Wall Street Journal for that kind of information anyway.
 
How can I say that? Well, first, I spent a chunk of my previous life in the financial industry, learned a few things and endured a few significant economic cycles along the way. I believe history is the best predictor. I read a lot about the economy every day, and I pay close attention to developing economic trends. I’ve had a pretty good track record of anticipating what is going on.
 
So, if you care to know: First, the news media can only report what has already happened, and it thrives on reporting the most negative aspects of what has already happened. Hence, by carefully reading the economic opinions and recited data, it is revealed over the past couple weeks that a preponderance of the negative news is from a few weeks back (late-November). And much of that has been trending back toward the positive for a couple months already. 

The stock market and commodities markets began settling down from their wild gyrations a few weeks ago, and these markets generally reflect bets on future activity–not past results. The financial industry came to the brink of ruin, but it managed to survive by the good graces of the American public and some folks in Washington D.C. who were paying attention for a change. And while not completely behind us, the recovery is beginning.

The auto industry is in the throws of what appears to be a nearly identical process, and with some major adjustments to come, it is not going to be allowed to fail (at least in a wholesale fashion). 

The housing sector appears to be at or near the bottom and poised to stabilize as fresh capital and spring demand come into the market. The consumer retail industry is currently engaged in the post-holiday collapse that has been anticipated already by the stock market and will emerge much leaner and smaller in just a few short weeks (but it’s going to sound really bad for a while). 

A new executive administration is soon to enter office with all of the promise that it usually brings. Finally, the largesse of taxpayer funds is just beginning to pour into the market in historic portions to stimulate the living tweedle out of us. 
 
Add to all of that the inimitable American public’s refusal to stay down for long and our demonstrated ability to pull ourselves up when things look the bleakest, and you have the makings of a recovery.
 
The government has arrived to help. How can it go wrong?    

What’s it mean? We are back to the one basic reality we all know is the primary driver of the success of our business from one year to the next, something even more fickle than the economy: The weather in spring! 
 
There’s nothing that drives garden center sales like a pleasing weekend forecast and a sunny Saturday! And when people have already been enduring a long winter of bad weather and financial discontent, and they have decided they can’t or shouldn’t splurge on some big luxury ticket, they will probably be even more excited or incited to go pick up some plants to perk up the garden and the deck and get on with life.

Celebrate the news that the economy is improving and get a little more enjoyment out of the “staycation” they’re planning this summer and feeling better about anyway. 

Will you be ready to capitalize on it? Or, are you planning to contribute another self-fulfilling prophecy of doom? I think the growers that plan to capitalize on it will win in two ways:

1) They will get the business they usually get, and;
2) They will get the business of the growers and retailers that didn’t plan to capitalize on it.
 
Do you want to participate in the coming economic recovery?  It is coming to a garden center near you soon!

Leave a Reply

34 comments on “View: A Positive Outlook On 2009

  1. Anonymous

    I not only agree, but it is truly refreshing to hear positive talk about our industry and the economy as a whole. It’s understandable that a lot of people are discouraged, but we either push forward or “roll over and die”. So many people I talk to say they’re not ordering hardgoods, shutting down most production, and taking a wait and see approach, all while understanding they may have to close the doors on their business if they have a bad year. How does anyone expect to have a good year if they don’t keep taking the same risks they always have to build their business? Not to mention that plan B is to “see what happens” and possibly shut down… then what? Have thousands of dollars in land, greenhouses, supplies and years of hard work deteriorate while you collect unemployment and look for a new career in the worst job market we’ve had in a decade or two? I’m not saying take new, bold risks, but I feel we all need to refocus our energy away from negativity and find new ways to make money and exist. Find solutions, not excuses. I apologize if this is slightly abrasive, but it’s the truth and we can all get through this with a little help and motivation from eachother!

    I appreciate your great article and insight, Al, and hope that many of us can not only learn from it, but also take advantage of this opportunity!

  2. Anonymous

    Hallelujah. Someone with a positive attitude!! If you keep telling me I am purple, after a while I will believe it; shame on the news people for pushing such negative thoughts to the public. I have always believed that positive thoughts overcome negative; it really takes some effort to be negative and I really do not want to take more pepcids!! I too am planning a GREAT spring, why, because I will make it happen!!

    Thanks for the article Al. That is one At A Boy for you.

  3. Anonymous

    Way to go Al,

    I just returned from the MANTS show in Baltimore, MD with the same positive feelings as yours. As I ponder on the economic state of our green industry and what I should do during the upcoming seasons I feel as though to ease up on production would be foolish. The attitudes of the buyers I found to be positive, even for the ones ( many of them ) that had a drop in sales for 08′.

    Murphy

  4. Anonymous

    Al’s optimism is as refreshing as a warm Spring rain. There certainly is some good news for our industry in lower energy costs, decreasing raw material costs for plastics and other materials, and maybe even a loosening of credit for long overdue capital expenditures. But it’s going to be more about seizing on opportunities created by the drastic economic events that still continue to rock the nation. The trillion or more dollars in economic stimulus the next President and Congress will pass out to the worthy and unworthy will ultimately cause further decay to the US dollar value worldwide. Unemployment rates will continue to rise and when they do finally level off or turn around it will likely be for lower paying jobs than were lost. These two factors should give US growers and manufacturers the opportunity to expand and export.

  5. Anonymous

    2008 Nobel Prize winner in economics, Paul Krugman, would disagree with your optimistic take. Your opinion is neither realistic, nor beneficial to growers.

    The housing market has not found a bottom. The lack of US demand for Chinese and Indian produced goods is taking down their economies.

    We remain tied to an oil driven economy which, when demand for oil returns, will continue to weaken the dollar through an imbalance of trade. Get real.

  6. Anonymous

    I’m sorry Tom, I don’t want to start a debate by any means, but feel obligated to respond to your statement. With all due respect, Paul Krugman didn’t win a Nobel Prize in “fortune telling” or “positive outlook studies”. So who knows what we can accomplish this year and if all the economic experts are so great and have flawless predictions, why are we even in this predicament in the first place?? I don’t disagree with your facts and we’re all very aware of them, but writing something to further drive down the hope, faith, and positive thinking that our whole population NEEDS right now, in my opinion is disrespectful and this isn’t the right place to voice that opinion and basically insult the author!

    I just don’t understand, do you suggest we all sit on our hands and watch time go by until the world comes to an end?(figure of speech). Or should we rally together, look harder for opportunities, help eachother with suggestions, and push forward? I apologize to everybody for taking offense and making it personal in a public discussion, but it would be nice to hear some optimism and opinions of how we’re going to get through this current economy. Not negativity and criticism…anyone agree??

  7. Anonymous

    You got it right Micheal

    I would feel safe to say that every person in our industry has at one time been stressed with our ever changing market.
    Tom, look at your product in relation to the consumer needs and make a couple of adjustments and you will have a more positive outlook. The housing decline has opened the door to the “curbside appeal” sales. Unless your selling pottery or other hard good products the Chinese and Indian market should not have much of an impact on your sales (if so, than find a higher quality hard good to offer). And the price of oil is down, just in time for the growing season. Change the way you think for a moment and you can find solutions.

    My sales and profits have both increased in 08′ and I am looking forward to an even better year in 09′. I will have to make some changes to achieve this, but “hey” if this business was easy than even a pessimist would make money.

  8. Anonymous

    While I agree that we cannot afford to sit around worrying about what is going to happen this spring, I also would say that we cannot get over excited about the great possibilities for this year. As is the case most of the time, it is important to keep a close eye on inventory and keep that merchandise turning. I don’t think this would be the year to try expanding operations or take a big risk on something new. There are better times to try that than now, when so much of the economy is not doing well.
    Sorry Michael but I don’t see the evidence that the housing market has hit bottom nor that the financial markets are completely settled down. And no, that doesn’t mean I’m rude, or that I am driving other people into despair. It means that I am looking at everything I can to make sure I make the right decisions for this season and keep risk to a minimum for now.
    As the saying goes, ‘Slow and steady wins the race.’

  9. Anonymous

    Chris, I apologize if I confused anyone, but I agree with you and Tom both. I think you make great points and we’re all aware of the downsides and risks. I was just glad to hear some optimism and people talking about opportunities, rather than getting discouraged. That’s what the article was about, and I hate to see anyone get off the subject and tell Al that his “opinion is neither realistic, nor beneficial to growers”.

  10. Anonymous

    The interesting thing about this discussion is that everyone is right. Our attitude is a choice and like Al, I am more positive than negative. Having lived thru a few of these “downturns” gives you prosceptive. Part of what no one wants to say is that this was a needed adjustment (part of the free market process). When things get wild (or too wild), the market contracts, slows down and adjusts. My good retailers are making good decisions. A few have closed (my client base is over 600 retailers and 2 have closed) their doors but since when is that a bad sign or even abnormal in any market? Going into business (retail or otherwise), or staying in business requires a certain fortitude that not everyone has. Things are difficult right now, but that is always when we get the most done. Spring will come, just like always, and people will buy plants. Maybe not as much as before…maybe more. But there is still good money to be made and that is the real point.

  11. Anonymous

    I Agree that the economy is not at the bottom. I have talked to several people in
    excavating and construction. The one constant thing that I hear is that we still have some work but nothing new is coming in. A comment from a realtor “I feel like I am unemployed”. I am however optimistic about the greenhouse industry. I still believe that bad economy cant trump good weather, and good economy cant overcome bad weather. Give us nice weekends in april and we should do fine.

  12. Anonymous

    When I was growing up, 40-50 years ago, an old German grower who survived WWII and the economic turmoil of the times, said that when there are bad times, three industeries didn’t collapse, but stayed flat or even increased a bit…liquor, pets and plants. All three are relatively low ticket commodities and make people feel good. I have never seen a spring season that totally tanked. Some springs are more adversely affected by weather and some areas are harder hit, but, overall, spring is spring. My opinion is that with a new administration, new optimism in the buying public, spring will be at worst, slightly down, but not in the crapper.

  13. Anonymous

    Thanks for erasing my previous post. I guess that this is the change we were hoping to see. More censorship, less freedom of speech. Good luck out there “journalists” and small business men and women. Welcome to the USSA!
    Btw, Optimism is always good. Realism is also good. Just “hoping” things will get better isn’t enough. Given the current rapid trend towards socialism, business owners and entrepreneurs had better start working politically for this country or they will be sitting on the sideline “hoping” for a govt. bailout!

  14. Anonymous

    Hi Ricardo,
    We received two comments from you, but not on the same page. The other one is here:
    http://www.greenhousegrower.com/news/index.php?storyid=1769

  15. Anonymous

    While not everyone need agree with Al’s opinion that the economy is set to rebound, several facts still remain: The green goods industry is always more driven by weather than economic factors. Just ask the growers in the Southeast. Last year, the economy was on fire. However, drought conditions in the Southeast caused many greenhouses to close, forced the sale of at least one large retailer and certainly hurt the profits and futures of many in our industry.

    Secondly, those choosing to participate in a recession, that is, cutting production drastically with no chance of making it up, will certainly suffer that exact fate. Al is correct in that some growers will profit from this coming spring. Those growers that have chosen to continue to produce product will have no trouble selling out with margins intact. From the doom and gloom we hear, many growers have cut back. This will undoubtedly lead to a shortage of plants. Growers with stock will be the beneficiaries of this supply vs. demand situation.

    Bottom line: if it is sunny and you have plants, it should be a good year!

  16. Anonymous

    You all make many good points. I have read this with great interest, here’s my take. We are at a pinnacle for change in this industry. I think many trends we have been seeing in our area for more pre-potted & high end items are going away. I think the higher end items are going to be replaced with basic seed items and vegetable flats.
    For many years people had other places to go spend money, now people are no longer satisfied spending money without something to show for it. People were also pressed for time, or thought they were, so they weren’t spending much time in their yards.
    So doesn’t it make sense that people will be more apt to garden this spring? The feel good of plants, the curb-appeal of their yards, the spare time?
    Let’s also not forget that with so many people unemployed the silver lining is that a bad week-end won’t keep people out of the garden centers. This is something no one has mentioned, but it is in the back of my mind, a nice sunny Wednesday may see a garden center swarmed if the weekend before was bad?
    Maybe things will get worse, but they will also eventually get better and this spring we need to get consumers excited about our product again, so that when they have less time and more money again in the future, we aren’t left behind, wondering what happened.

  17. Anonymous

    hello all,

    I currently have a great job, with a company not really being affected by the economy. I work for a cable company and it seems people are at home more and watching more tv, so no real loss on this end. My question is this, I have an oppertunity to go to work for a greenhouse working as the managing grower. they wanted some one with no prior knowledge to train as they see fit. the pay would be about the same as i make now, with benefits. I am just scared of the economy and what will happen to them. they have gone from a million dollar company to 5-8 million over the last 2 years. they sell to one of the big box stores here in the south and have done really good with them. any ideas on if this is good idea to change to this field during this economy or stay were i am at and wade it out? this would be a great oppertunity for me to get in with this mom and pop company that has been around for 16 years, but i’m scared to leave my current job. thanks in advance for any comments, scrutiny or what ever you have for me.

  18. Anonymous

    I not only agree, but it is truly refreshing to hear positive talk about our industry and the economy as a whole. It’s understandable that a lot of people are discouraged, but we either push forward or “roll over and die”. So many people I talk to say they’re not ordering hardgoods, shutting down most production, and taking a wait and see approach, all while understanding they may have to close the doors on their business if they have a bad year. How does anyone expect to have a good year if they don’t keep taking the same risks they always have to build their business? Not to mention that plan B is to “see what happens” and possibly shut down… then what? Have thousands of dollars in land, greenhouses, supplies and years of hard work deteriorate while you collect unemployment and look for a new career in the worst job market we’ve had in a decade or two? I’m not saying take new, bold risks, but I feel we all need to refocus our energy away from negativity and find new ways to make money and exist. Find solutions, not excuses. I apologize if this is slightly abrasive, but it’s the truth and we can all get through this with a little help and motivation from eachother!

    I appreciate your great article and insight, Al, and hope that many of us can not only learn from it, but also take advantage of this opportunity!

  19. Anonymous

    Hallelujah. Someone with a positive attitude!! If you keep telling me I am purple, after a while I will believe it; shame on the news people for pushing such negative thoughts to the public. I have always believed that positive thoughts overcome negative; it really takes some effort to be negative and I really do not want to take more pepcids!! I too am planning a GREAT spring, why, because I will make it happen!!

    Thanks for the article Al. That is one At A Boy for you.

  20. Anonymous

    Way to go Al,

    I just returned from the MANTS show in Baltimore, MD with the same positive feelings as yours. As I ponder on the economic state of our green industry and what I should do during the upcoming seasons I feel as though to ease up on production would be foolish. The attitudes of the buyers I found to be positive, even for the ones ( many of them ) that had a drop in sales for 08′.

    Murphy

  21. Anonymous

    Al’s optimism is as refreshing as a warm Spring rain. There certainly is some good news for our industry in lower energy costs, decreasing raw material costs for plastics and other materials, and maybe even a loosening of credit for long overdue capital expenditures. But it’s going to be more about seizing on opportunities created by the drastic economic events that still continue to rock the nation. The trillion or more dollars in economic stimulus the next President and Congress will pass out to the worthy and unworthy will ultimately cause further decay to the US dollar value worldwide. Unemployment rates will continue to rise and when they do finally level off or turn around it will likely be for lower paying jobs than were lost. These two factors should give US growers and manufacturers the opportunity to expand and export.

  22. Anonymous

    2008 Nobel Prize winner in economics, Paul Krugman, would disagree with your optimistic take. Your opinion is neither realistic, nor beneficial to growers.

    The housing market has not found a bottom. The lack of US demand for Chinese and Indian produced goods is taking down their economies.

    We remain tied to an oil driven economy which, when demand for oil returns, will continue to weaken the dollar through an imbalance of trade. Get real.

  23. Anonymous

    I’m sorry Tom, I don’t want to start a debate by any means, but feel obligated to respond to your statement. With all due respect, Paul Krugman didn’t win a Nobel Prize in “fortune telling” or “positive outlook studies”. So who knows what we can accomplish this year and if all the economic experts are so great and have flawless predictions, why are we even in this predicament in the first place?? I don’t disagree with your facts and we’re all very aware of them, but writing something to further drive down the hope, faith, and positive thinking that our whole population NEEDS right now, in my opinion is disrespectful and this isn’t the right place to voice that opinion and basically insult the author!

    I just don’t understand, do you suggest we all sit on our hands and watch time go by until the world comes to an end?(figure of speech). Or should we rally together, look harder for opportunities, help eachother with suggestions, and push forward? I apologize to everybody for taking offense and making it personal in a public discussion, but it would be nice to hear some optimism and opinions of how we’re going to get through this current economy. Not negativity and criticism…anyone agree??

  24. Anonymous

    You got it right Micheal

    I would feel safe to say that every person in our industry has at one time been stressed with our ever changing market.
    Tom, look at your product in relation to the consumer needs and make a couple of adjustments and you will have a more positive outlook. The housing decline has opened the door to the “curbside appeal” sales. Unless your selling pottery or other hard good products the Chinese and Indian market should not have much of an impact on your sales (if so, than find a higher quality hard good to offer). And the price of oil is down, just in time for the growing season. Change the way you think for a moment and you can find solutions.

    My sales and profits have both increased in 08′ and I am looking forward to an even better year in 09′. I will have to make some changes to achieve this, but “hey” if this business was easy than even a pessimist would make money.

  25. Anonymous

    While I agree that we cannot afford to sit around worrying about what is going to happen this spring, I also would say that we cannot get over excited about the great possibilities for this year. As is the case most of the time, it is important to keep a close eye on inventory and keep that merchandise turning. I don’t think this would be the year to try expanding operations or take a big risk on something new. There are better times to try that than now, when so much of the economy is not doing well.
    Sorry Michael but I don’t see the evidence that the housing market has hit bottom nor that the financial markets are completely settled down. And no, that doesn’t mean I’m rude, or that I am driving other people into despair. It means that I am looking at everything I can to make sure I make the right decisions for this season and keep risk to a minimum for now.
    As the saying goes, ‘Slow and steady wins the race.’

  26. Anonymous

    Chris, I apologize if I confused anyone, but I agree with you and Tom both. I think you make great points and we’re all aware of the downsides and risks. I was just glad to hear some optimism and people talking about opportunities, rather than getting discouraged. That’s what the article was about, and I hate to see anyone get off the subject and tell Al that his “opinion is neither realistic, nor beneficial to growers”.

  27. Anonymous

    The interesting thing about this discussion is that everyone is right. Our attitude is a choice and like Al, I am more positive than negative. Having lived thru a few of these “downturns” gives you prosceptive. Part of what no one wants to say is that this was a needed adjustment (part of the free market process). When things get wild (or too wild), the market contracts, slows down and adjusts. My good retailers are making good decisions. A few have closed (my client base is over 600 retailers and 2 have closed) their doors but since when is that a bad sign or even abnormal in any market? Going into business (retail or otherwise), or staying in business requires a certain fortitude that not everyone has. Things are difficult right now, but that is always when we get the most done. Spring will come, just like always, and people will buy plants. Maybe not as much as before…maybe more. But there is still good money to be made and that is the real point.

  28. Anonymous

    I Agree that the economy is not at the bottom. I have talked to several people in
    excavating and construction. The one constant thing that I hear is that we still have some work but nothing new is coming in. A comment from a realtor “I feel like I am unemployed”. I am however optimistic about the greenhouse industry. I still believe that bad economy cant trump good weather, and good economy cant overcome bad weather. Give us nice weekends in april and we should do fine.

  29. Anonymous

    When I was growing up, 40-50 years ago, an old German grower who survived WWII and the economic turmoil of the times, said that when there are bad times, three industeries didn’t collapse, but stayed flat or even increased a bit…liquor, pets and plants. All three are relatively low ticket commodities and make people feel good. I have never seen a spring season that totally tanked. Some springs are more adversely affected by weather and some areas are harder hit, but, overall, spring is spring. My opinion is that with a new administration, new optimism in the buying public, spring will be at worst, slightly down, but not in the crapper.

  30. Anonymous

    Thanks for erasing my previous post. I guess that this is the change we were hoping to see. More censorship, less freedom of speech. Good luck out there “journalists” and small business men and women. Welcome to the USSA!
    Btw, Optimism is always good. Realism is also good. Just “hoping” things will get better isn’t enough. Given the current rapid trend towards socialism, business owners and entrepreneurs had better start working politically for this country or they will be sitting on the sideline “hoping” for a govt. bailout!

  31. Anonymous

    Hi Ricardo,
    We received two comments from you, but not on the same page. The other one is here:
    http://www.greenhousegrower.com/news/index.php?storyid=1769

  32. Anonymous

    While not everyone need agree with Al’s opinion that the economy is set to rebound, several facts still remain: The green goods industry is always more driven by weather than economic factors. Just ask the growers in the Southeast. Last year, the economy was on fire. However, drought conditions in the Southeast caused many greenhouses to close, forced the sale of at least one large retailer and certainly hurt the profits and futures of many in our industry.

    Secondly, those choosing to participate in a recession, that is, cutting production drastically with no chance of making it up, will certainly suffer that exact fate. Al is correct in that some growers will profit from this coming spring. Those growers that have chosen to continue to produce product will have no trouble selling out with margins intact. From the doom and gloom we hear, many growers have cut back. This will undoubtedly lead to a shortage of plants. Growers with stock will be the beneficiaries of this supply vs. demand situation.

    Bottom line: if it is sunny and you have plants, it should be a good year!

  33. Anonymous

    You all make many good points. I have read this with great interest, here’s my take. We are at a pinnacle for change in this industry. I think many trends we have been seeing in our area for more pre-potted & high end items are going away. I think the higher end items are going to be replaced with basic seed items and vegetable flats.
    For many years people had other places to go spend money, now people are no longer satisfied spending money without something to show for it. People were also pressed for time, or thought they were, so they weren’t spending much time in their yards.
    So doesn’t it make sense that people will be more apt to garden this spring? The feel good of plants, the curb-appeal of their yards, the spare time?
    Let’s also not forget that with so many people unemployed the silver lining is that a bad week-end won’t keep people out of the garden centers. This is something no one has mentioned, but it is in the back of my mind, a nice sunny Wednesday may see a garden center swarmed if the weekend before was bad?
    Maybe things will get worse, but they will also eventually get better and this spring we need to get consumers excited about our product again, so that when they have less time and more money again in the future, we aren’t left behind, wondering what happened.

  34. Anonymous

    hello all,

    I currently have a great job, with a company not really being affected by the economy. I work for a cable company and it seems people are at home more and watching more tv, so no real loss on this end. My question is this, I have an oppertunity to go to work for a greenhouse working as the managing grower. they wanted some one with no prior knowledge to train as they see fit. the pay would be about the same as i make now, with benefits. I am just scared of the economy and what will happen to them. they have gone from a million dollar company to 5-8 million over the last 2 years. they sell to one of the big box stores here in the south and have done really good with them. any ideas on if this is good idea to change to this field during this economy or stay were i am at and wade it out? this would be a great oppertunity for me to get in with this mom and pop company that has been around for 16 years, but i’m scared to leave my current job. thanks in advance for any comments, scrutiny or what ever you have for me.