The week before the California Spring Trials, we learned The Conard-Pyle Co. is reining in the production and distribution of rooted young plants for its Knock Out roses. Effective July 1, Syngenta Horticultural Services and Star Roses will be the exclusive brokers and Greenheart Farms and Northwest Horticulture will be the exclusive young plant producers. Star Roses is Conard-Pyle’s sales and marketing arm.
Introduced 10 years ago, the Knock Outs have revolutionized the shrub rose category the way Waves revolutionized petunias. Although it’s fairly normal for new products to be introduced on an exclusive or limited basis, it’s rare to see an established product that’s a runaway success get reined in 10 years later. A few of the brokers and licensees who are losing access feel a great, money-making product is being taken away.
Conard-Pyle did receive backlash from at least two of Syngenta’s competitors. This took the rose breeder by surprise because the broker side is a small part of its overall business but turned out to be the most vocal. Although broker sales may be the be-all, end-all in annual bedding plant sales from breeders to growers, this isn’t the dominant sales channel for nursery products. Most of the nursery growers who produce Knock Outs are bare root propagators and self propagators who would buy directly from Star Roses.
Conard-Pyle has worked directly with all of its licensees to implement changes. This was necessary because the Knock Outs are moving to a mandatory branded pot and tag program, which could not happen without streamlining supply. Growers who do not want to participate will no longer be producing Knock Outs. Jacques Ferare, who oversees new product development and licensing for Conard-Pyle, says 90 percent of the growers who are producing Knock Out asked the company to do this.
“They said, you have a brand. You’d better act like you have one,” Ferare says. “Knock Out started out like any other introduction and was very successful. It has become a brand. Growers and retailers will still be able to get the plant they want, just in a different way.” Conard-Pyle realizes the changes it is implementing may result in decreased overall sales volume for Knock Outs but felt it was necessary to protect the integrity of its brand.
Bill DeVor of Greenheart Farms, who explained the changes taking place during the California Spring Trials said Conard-Pyle needed to rescue the Knock Outs from becoming devalued and commoditized in the marketplace. This especially has been an issue the past few years, as nursery growers have been hit harder by the economy than bedding plant growers and have been more tempted to dump product on the market at low prices. “The market is saturated now. I’ve seen a gallon pot being sold for three bucks at retail,” DeVor says. “That’s why Conard-Pyle had to get its arms around the product.”
For those who lost the rights to produce and distribute Knock Outs or don’t want to participate in the branding program, there are other good landscape rose lines that don’t have the name recognition. This is an opportunity for those lines to gain market share and for breeders and producers to differentiate.
Although the greenhouse and nursery sides have been coming together, supply chains are still rooted in very strong traditions. Conard-Pyle is trying to create a 21st-century model that’s in between fully open and totally closed production and distribution. Other nursery brands, like Flower Carpet Roses and Endless Summer hydrangeas, are closed in their production networks.
Kudos to Conard-Pyle for not accepting that all successful products are doomed to eventually become commodities. This breeder has the courage to break the cycle.