Eight months into the job, Speedling Inc.’s president and CEO David Robbins has been exploring the potential to expand the plug producer’s global footprint in vegetables and ornamentals while bringing transplant technology to a wide range of agricultural markets.
Based in Sun City, Fla., Speedling is owned by Wearn Brothers Ltd. (WBL) in Singapore. It has eight production facilities in the United States and 10 in China. In the U.S. ornamentals market, Speedling ranks at No. 5 on our Top 100 Growers with 5,322,000 square feet of greenhouse production, 37 percent of which is offshore. On our Top 25 Young Plant Growers, Speedling ranks at No. 4, producing more than 300 million plugs a year.
Robbins came to Speedling from perennials powerhouse Northwest Horticulture in Mt. Vernon, Wash. Prior to that, he was COO and CFO of vegetable transplant grower Greenheart Farms in California for 13 years. He expanded that business from $5 million to $18 million in sales and crops to include poinsettias, roses and reclamation grasses.
But his first exposure to agriculture was in the food business, as a frozen foods plant manager at age 23 in 1974, moving up to become CEO at age 32. Products also included canned and dehydrated foods, as well as beverages. Robbins encouraged vegetable growers to use transplants.
“In tomatoes, we went from 2,500 acres produced with transplants to 20,000 acres in just five years,” he says. “Today, 50 to 60 percent of California’s processing tomatoes are produced from transplants. Growers get more yields from hybrid seed in transplants. It’s exciting to change the paradigms in agricultural systems.”
He was able to accomplish the same thing with roses at Greenheart Farms, replacing labor-intensive bare root production with containerized transplants.
At Speedling, Robbins sees incredible opportunities. “This is a much bigger company that’s more diverse geographically and internationally,” he says. “Being 50 percent agriculture and 50 percent ornamental brings real strategic advantages. This has more potential than a specialized company.”
Being owned by Asians in Singapore made it a natural fit for Speedling to launch business ventures there in 1998. In addition to producing ornamental and vegetable plugs for Chinese consumption, Speedling is involved in producing cut flowers for secondary markets, like Thailand and Malaysia. Although Robbins questions if it would make sense to ship cut flowers to the United States and compete with South America, he believes the China operations could compete against Africa in Europe.
Another possibility is exporting cuttings that can be rooted in the United States. In China, Speedling is already working with breeders like Goldsmith to serve the Chinese market and plans to expand breeder relationships in both flowers and vegetables. Key vegetable crops include peppers, tomatoes, artichokes, asparagus and other field crops. New crops include rice transplants, which would help Chinese farmers conserve water, and Chinese herbals for both domestic production and export to the United States.
Doing business in China is difficult but it can be done, Robbins says. “In China, you never own property. If you have at least 51 percent control, you can have a five-year contract with the Chinese government, but if things aren’t working, it can be different next year,” he explains. “We rely on U.S.- and Canadian-trained Chinese employees who can be trusted to take our business to the next level.”
Contrasting activities in China with those in the United States, Robbins says China is more primitive with a focus on the basics, and in the United States, Speedling is focused on refinement. “While the U.S. market evolved over time, China is more like Australia, going from rudimentary to automatic overnight,” he says. “The difference is 500-acre farms versus 20-acre farms and a greater need for efficiencies. In China, a lot of the farms are 10 acres or less. There are consortiums of farmers and the challenge of getting everyone to agree. They also need to invest in infrastructure to bring product to market. We want to be part of that.”
The past few years, Speedling has focused on profitability. Under Robbins, Speedling will be focused on maximizing efficiencies and performance, forging strategic alliances and becoming more proactive in sales and marketing.
At one point, Speedling was going to reinvest in its Sun City facility. But does it make sense to build expensive greenhouse facilities in the path of a hurricane? “While Sun City is ideal for climate and location serving the Florida market, it doesn’t make sense because of hurricanes and flood zones,” he says. “Why invest in $30 per-square-foot greenhouses when real estate is going up $10,000 an acre a year? Our intent is to continue in Florida. We’re making risk assessments of our locations. We’re also investing in joint ventures with other growers in brand new, automated facilities.”
To become more proactive in sales, Robbins has approved the hiring of two regional sales representatives to manage relationships and support the broker network.
“We don’t want to compete with the broker network,” he says. “We want to get closer to our grower customer. If a grower goes from 120 stores to 110 stores and loses X percent of business, we’ll know that. It’s field support and relationship management.” Part of this support includes investing in information technology to interface with customers, including real-time availability with instantaneous updates.
Robbins sees relationships as a way to drive business and develop pull-through programs that truly are a win-win for the entire distribution chain. “In ornamentals, we have to convince the consumer there’s more value,” he says. “Between the breeder, grower, finisher and store, someone gets a lot of margin but not everybody. I’d like to see more fairness in pull-through marketing.”
One mandate from Singapore is to introduce at least one new product each year. New markets that are ripe for transplant technology include plants grown for biofuels, grain products for cattle and any biologically grown materials.
“There’s a lot of promise in anything that has low seed production or expensive seed,” Robbins says. “Our growth will be as much as 50 percent in five years, and I believe that’s conservative. It’s a tough business, but there’s a lot of opportunity. For me, this work feels like feeding the world and giving the gift of flowers.
What we produce are good products, nourishing for the soul and body. And I can come to work in jeans and do something I really believe in.”