Transportation: Searching For Payback

Every now and then, the media will report that gas prices have dropped, but we’re all still remembering the good old days when you could get one gallon for less than $1. Search online, and you’ll find all kind of opinions on gas prices. Some media stories even try to convince us that high gas prices are good (because they spur online spending and ethanol research). But mostly, gas prices are a burden, especially for small businesses.

Our columnist Tim Higham shared some comparative equations in a recent edition of our Benchrunner e-newsletter. “A grower shipping 400 truck loads (averaging 1,250 miles per truck) each year is paying $83,333 more for fuel [compared to 1997 prices], just to ship the product,” he says This doesn’t include the increased costs you pay to your suppliers for their increased fuel costs.

A USA Today article reports 20 percent of 1,200 owners and managers of small businesses have delayed purchasing vehicles and other high-price items because gas costs more. And that USA Today article was written back in 2005, when the average fuel price was $2.27 per gallon, according to the Energy Information Administration (EIA), part of the U.S. Department of Energy. EIA expects the average for this summer to be $2.95. 

Finding Profit Elsewhere

So what are some options for squeezing extra money out of production to pay for that higher transportation? Check our our Payback Primer on page 49. Senior Staff Editor Laura Drotleff talked favorite pieces of equipment with growers, while I heard suppliers’ thoughts and advice on return on investment for big equipment purchases.

Return on investment is personal and philosophical. What’s your approach? Look for the newest machine with the most modern capabilities? The one that provides the quickest payback?

For some ideas come wintertime, build a virtual greenhouse with Agricultural Research Service’s Plant Pathologists Jim Locke, Jonathan Frantz and Charles Krause. Their Virtual Grower software, downloadable from http://www.ars.usda.gov/services/software/download.htm?softwareid=108, lets growers experiment with different heating types and their effects. You enter location, the size of your greenhouses, building materials and heating schedule, and then compare costs using several types of heating methods. The Virtual Grower is a work in progress, so check it out and send suggestions to the guys at ARS. Get some ideas for your operation and help out others.

Leave a Reply

More From Finance/Operations...

October 10, 2017

Sharpen Your Skills in Cost Management and Profitability With This Online Course

The University of Florida is offering a new online course on costing and profitability. The course will take growers through the process of how to accurately evaluate cost of production, labor efficiency, pricing, and equipment investment decisions.

Read More
Willoway Nurseries Team

October 1, 2017

How Willoway Nurseries Gets Its Staff Engaged in The Company’s Future

Willoway Nurseries in Avon, OH, is creating a culture with people who think, act, and feel like owners. Learn how its team is taking the business to the next level.

Read More

September 21, 2017

Horticulture Is All About Connections

The beauty of our industry is that we are more than willing to reach out and help those around us. What connections can you make today to help your business, and what can you offer to help another grower?

Read More
Latest Stories

October 10, 2017

Sharpen Your Skills in Cost Management and Profitabilit…

The University of Florida is offering a new online course on costing and profitability. The course will take growers through the process of how to accurately evaluate cost of production, labor efficiency, pricing, and equipment investment decisions.

Read More
Willoway Nurseries Team

October 1, 2017

How Willoway Nurseries Gets Its Staff Engaged in The Co…

Willoway Nurseries in Avon, OH, is creating a culture with people who think, act, and feel like owners. Learn how its team is taking the business to the next level.

Read More

September 21, 2017

Horticulture Is All About Connections

The beauty of our industry is that we are more than willing to reach out and help those around us. What connections can you make today to help your business, and what can you offer to help another grower?

Read More
Worker taking cuttings at Vivero Internacional.

September 11, 2017

Vivero Internacional Elevates Clean Cuttings to New Hei…

One of the last independent cutting operations, this fast-growing company raises the standard for delivering clean, high-quality unrooted cuttings.

Read More
Selecta Sponsor bed at Raker trial gardens

September 5, 2017

C. Raker & Sons Acquired By Roberta’s Unique Garden…

Ownership will change hands in December, and Raker will supply young plants for the 2018 season. Beyond that, leadership of the two operations say they are excited to move forward with a partnership that will continue to supply the industry, and gardeners, with top-quality plants.

Read More

August 1, 2017

MPS Honors D.S. Cole Growers for 10 Years of Sustainabi…

At Cultivate’17, a ceremony to mark a 10-year milestone since D.S. Cole Growers became involved with More Profitable Sustainability (MPS), as the first U.S. grower to achieve MPS certification, took owner Doug Cole by surprise. Separate celebrations also recognized Metrolina Greenhouses and Dümmen Orange for achieving MPS certification.

Read More
Nexus greenhouse construction for Knox Cannabis Facility

July 27, 2017

Ornamental Growers Will Revolutionize Cannabis Industry…

Professional growers have much to offer the emerging cannabis market, according to the co-owner of Knox Medical, one of the licensed cannabis producers in Florida.

Read More
Ball ColorLink logo

July 11, 2017

Get Guidance on Running Your Business from Ball ColorLi…

Representatives from Ball ColorLink will be on-hand at Cultivate’17 to answer questions and present business-building tools and industry insights to growers.

Read More
Lean Consortium in Washington

July 10, 2017

Washington Growers Join New Horticulture Lean Consortiu…

The group of growers has committed to learning and applying the principles of Lean, a method for eliminating waste that results in more value to customers delivered at a lower cost, in a shorter time, with fewer defects and less human effort.

Read More

April 11, 2017

Jerry Halamuda of Color Spot Nurseries Retires

The co-founder of Color Spot Nurseries has retired, effective immediately, and has named a replacement.

Read More

March 21, 2017

How Greenhouse Vegetable Growers Can Prepare for a Prod…

The United Fresh Produce Association is holding a Recall Ready Workshop in April that is designed to help growers properly manage a recall, from liability to communications.

Read More

March 14, 2017

Expanded Customer Footprint, E-Commerce, Succession Key…

Costa Farms' acquisition of indoor foliage producer Delray Plants rocked the industry, but the story behind Delray Plants' sale is the same as for many growers struggling with succession planning. For Costa Farms, the strategic purchase expands its customer footprint and also fast tracks its foray into e-commerce.

Read More

March 10, 2017

Costa Farms Expands With Purchase of Indoor Houseplant …

Costa Farms annnounced March 10 that it has acquired Delray Plants, one of the leaders in the indoor houseplant industry. The two operations are committed to the same values, principles, and goals to grow the industry, and will fit well together to accomplish this, say Randy Gilde, CEO of Delray Plants, and Joche Smith, CEO of Costa Farms.

Read More
Ken and Deena Altman

March 7, 2017

Altman Plants in Escrow to Purchase EuroAmerican Propag…

Ken Altman, a co-owner of Altman Plants based in Vista, CA, has confirmed that the operation is currently in escrow to purchase EuroAmerican Propagators, the Bonsall, CA-based young plant and finished plant grower that filed Chapter 7 Bankruptcy on Jan. 23, 2017. Ken and Deena Altman are co-owners of Altman Plants and The Plug Connection, along with their son Matthew, who has recently bought into the family business. The 55 acres of land and all of the facilities on it, which were previously owned by Jerry Church, a partner in EuroAmerican Propagators, are part of the purchase agreement currently in escrow, Altman says. However, it would not be absorbed by Altman Plants, which in 2016 was number 3 on Greenhouse Grower’s Top 100 Growers list with more than 11 million square feet of environmentally controlled greenhouse production, 62 acres of shade production, and 400 acres of outdoor field production. Altman Plants’ property […]

Read More
EuroAmerican Propagators Greenhouses

February 14, 2017

Suppliers Comment on Plant Genetics’ Fate After EuroAme…

Since the operation’s bankruptcy filing on January 23, 2017, suppliers associated with EuroAmerican Propagators have updated Greenhouse Grower on what the operation’s bankruptcy means for them – and how it will impact grower customers.

Read More
Stephanie Whitehouse

January 17, 2017

Stephanie Whitehouse Takes Her Passion for Plants to Di…

Stephanie Whitehouse, who has spent the last seven years as the Sales and Marketing Director for Peace Tree Farm in Kintnersville, PA, recently joined Dickman Farms Greenhouse and Garden Center in Auburn, NY, as the company’s new Retail General Manager.

Read More
Laura Drotleff

December 6, 2016

Are You Driving Young Growers Away? [Opinion]

In a time when the industry is facing a critical shortage of both labor and skilled, educated growers, it's important that grower operations don't unwittingly turn candidates off to a career at their business or in the industry in general. Take a closer look at your hiring practices to ensure you are being inclusive and not breaking any laws.

Read More
Trays move on an overhead conveyor to the end of the production line, where workers carefully pack the cleaned, sized, graded, counted and sorted Calla tubers

November 29, 2016

Texas Judge Halts Overtime Rule; Here’s What It Means F…

According to Craig Regelbrugge at AmericanHort, the injunction against the overtime rule is welcome news for horticulture.

Read More