365-Day Forecast

Industry leaders shared their visions of the future with Greenhouse Grower. Here’s a sample of their prognostications. 

What might 2007 hold?

Growth will come from hanging baskets and containers as well as premium potted annuals. We will continue to see the vertical integration in the industry led by more service, merchandising, marketing and product development being co-developed by the growers and retailers. Growers need to be more keenly aware of how stores are laid out and how fast they turn product to build their production plan in a way that flows with how stores sell their product.

– Abe VanWingerden, Metrolina Greenhouses 

My forecasts are for continued consolidation of the industry, more smaller growers looking to alternative or specialty crops and increased cooperation among smaller growers. I think this will help small- and medium-sized operations maintain profitability (at least I hope so).

– Erik Runkle, Michigan State University (MSU) 

I really believe the people-plant connection is built into us, so we have growth potential in 2007 and forever. There’s much more to this than just getting rid of pallets and cinder block. It’s in the attitude about it.

– Sid Raisch, Horticultural Advantage 

What market segments might grow or decline?

The greatest growth potential is in "do it for me" (DIFM) and made-to-order. Today’s retirees and dual-income families are busy and have the money to beautify their home. These same customers who also value unique things like a custom-planted container garden. I think painted poinsettias will continue to gain market share as they appeal to the younger generation and the made-to-order market.

– Kerstin Ouellet, Pen & Petal 

I doubt most Baby Boomers will keep their McMansions long into retirement, so a key will be adapting to meet their new lifestyle which may mean smaller properties managed by a property manager.

– Bridget Behe, MSU 

Annuals and perennials, vegetables and herbs will continue to see growth. Trees and shrubs may not, as the category clearly benefits the most from new home starts.

– Gary Mangum, Bell Nursery

"Prices are mostly a decision of how much ink to put on a piece of paper. We have to think ourselves out of the current price and into the new one." 

– Sid Raisch

Growth areas are going to be services, whether it be container gardening, landscaping services, DIFM vs. DIY, etc. I think the green roof concept may get some legs over next few years. Areas of decline would be commodity plants and acceptance of bad quality.

– Jeremy Deppe, Spring Meadow Nursery 

Professional landscape services are up and there is growth in the major retail area. A renewed interest in potted plants and continued interest in container gardening can help capture new consumers who may not have large gardens but still buy plants.

– Jeff Gibson, Ball Horticultural

The segment with the best growth opportunity will be growers who can tap into the DIFM trends either through their own landscape divisions, or those that can partner with someone with that accessibility.

– John Holmes, Laura Kunkle, Steve Carver, OFA 

Contract growing is definitely a trend that I see increasing, especially with growers that are feeding vendor managed inventory (VMI) programs.

– Vinny Naab, Naab Horticultural Marketing 

Cool tropicals up, "old lady plants" down. Pre-done planters and large baskets up, and anything that reduces time and adds immediate pleasure up.

– Laurie Scullin, Floragem 

What pressures do you see impacting growers in 2007?

Energy costs for heating and transportation will be key. Some regions already deal with water regulations – for other regions, legislation is coming.

– Bridget Behe 

The balance between supply and demand appears to be our biggest dilemma. We used to be able to control the market, the quality and the price and get away with it. Whatever the grower needed was taken care of by an automatic price increase. Now we are being squeezed and need to look at all aspects of our business to see how we can remain profitable with flat demand and flat prices.

– Doug Cole, D.S. Cole Growers 

Energy has been at the top of our mind for the last little while, but others have all been problems for years. The real issue is that growers are not getting prices up, and that has nothing to do with their costs.

– Laurie Scullin 

Clearly labor availability is a concern for the green industry. All segments are impacted by available labor, cost not being an issue. I’m so sick of hearing about our industry’s need for "cheap labor." Our industry needs people who are excited about what we do and want to stay and grow with the business. Quality labor becomes even more important as more companies focus on further supporting sell through at the retail level through grower-driven merchandising.

– Gary Mangum 

Labor pressures only seem to be worsening for the green industry, partly driven by increasing immigration enforcement and partly a result of workers being drawn into more lucrative jobs in other sectors, such as construction. On that front, a slowing housing market may take some pressure off in the year ahead, but in the green industry, the more year-round the job, the better positioned the employer to attract and retain workers.

– Marvin Miller, Ball Horticultural 

Rising fuel costs, regulatory issues such as chemical application and controls, and VMI will continue to put additional price pressures on growers.

– Jeff Gibson 

The increased minimum wage will certainly affect growers, but in the long run it should have a positive impact on the economy.

– Kerstin Ouellet

How can growers raise prices?

We don’t do enough listening to and watching our customers to know what is and isn’t working for them. We are challenged to provide value when we don’t really understand what they do with our products once they get home. There is value in pre-constructed containers for individuals who have more money than time, there is value in delivering and planting items, and there is value in creating a memorable experience by building the backdrop for a beautiful wedding or party.

– Bridget Behe 

We as an industry need to make every effort to grow and ship excellent material, every time. We need to invest in the future by working with the breeders to select the best performing plants for the consumer – not just the greenhouse bench. And finally, we need to work with our retail partners to present the material in a way that’s attractive to the consumer. The better job we do, the more "lifetime" relationships we will create. When folks have a great experience they tell others. They do the same thing with even more vigor when they have a bad experience.

– Gary Mangum 

Get in the practice of pricing for value, not just cost. We have undervalued the product by thinking it was always about price for the customer. Once supply is in line, the efforts to increase demand will be that much more fruitful.

– John Holmes et al 

What trends do you think will have a market impact?

New uses for products, such as green roofs, with an emphasis on the environment will likely increase. Lifestyle impacts our industry most, so we need to be where people relax, entertain and decorate.

– Bridget Behe 

The smaller wholesale growers will be looking for niche markets where they will produce high-value crops that don’t warrant high volume.

– Doug Cole 

As the chains get more savvy with their marketing and POP, they will continue to gain market share.

– Bill Swanekamp, Kube-Pak 

The aspect of instant gratification with larger plants that’s not often talked about is consumer success. Bigger is better for instant impact, but it’s also better for consumer success.

– Gary Magnum 

Shrubs are going to go through the roof. Landscapers are going to be a more important part of the industry than ever before, and will be making decisions for people, which may cut down on demand for diversity of plant material.

– Allan Armitage, University of Georgia 

The new shrub varieties that are being introduced into the marketplace are focusing on new exciting colors, easy-to-grow varieties, multiple seasons of interest, have impulse appeal, have good insect and disease resistance and are dwarf and compact and will dominate the shrub segment in the coming years.

– Jeremy Deppe 

Sustainability is not so much a trend as a new way of thinking. Our industry has to explore ways to be part of the sustainable movement in a profitable way.

– Bill Doeckel, Ball Horticultural 

Contract growing will continue to impact overall industry growth. The most active building of greenhouse structures is currently going on in the retail sector, not necessarily wholesale. On the consumer side, we will see growth with fewer, but larger, more expensive per unit item purchases. Retailers and growers will need to respond accordingly through better presentation, packaging and product assortment.

– Jeff Gibson 

Contract growing could create more efficiency and help with overproduction. The growth of mega retailers will continue the push towards more contract growing, the growth of mega growers and attrition of smaller growers who have not or cannot change to meet the needs of their end consumer or their clients.

– John Holmes et al 

Frequent delivery schedules are the most critical need.

– Sid Raisch 

Contract growing and consolidation. In heavily populated areas, enough volume is present to allow folks to compete and be independent.

– Jeff Warschauer, Nexus 

How can we grow demand with consumers?

There are whole generations of consumers that are reaching the age where gardening has the potential to be relevant as an antidote to their high-tech world. Young people think and buy differently, and our industry has to figure out how to appeal to them.

– Anna Ball, Ball Horticultural 

We need to help consumers be better gardeners, and we need help them to be more confident in gardening.

– Susan McCoy, Garden Media Group 

We need to build relevance to younger consumers using technology as a window into their lifestyle. We need to maintain relevance to Baby Boomers through retirement. We can’t afford to lose either as a potential target market.

– Bridget Behe 

Identify under-served market segments, such as the ethnic consumer as well as the DSOIFMs (Do Some Of It For Me) willing to do some of the work and hire someone to do the rest.

– Kip Creel, Standpoint 

The independents need to realize that they are not only competing with the box stores, but with Starbucks, Olive Garden and The Pottery Barn.

– Doug Cole 

Look inside the box store. You walk through a beautiful bathroom display, not just an aisle with plumbing parts, and they offer to install, deliver, seminar you, etc. We still offer "plumbing parts."

– Laurie Scullin 

We need to position floriculture products against other non-necessity items. The wine industry has managed to position wine as the perfect hostess/host gift, whereas flowers are often not even considered.

– Kerstin Ouellet 

What are your thoughts on collective promotion?

Flowers and plants not only feed the soul but also increase productivity, make people healthier, keep the air cleaner and reduce crime! As an industry, we need to figure out ways to get these messages out. Doing so will not only benefit our society but also the floriculture industry – and could help us attract new consumers.

– Anna Ball 

Programs such as America In Bloom are having an impact, one city at a time, especially when industry members partner with the municipality, commercial and civic interests; with such exposure and a little marketing imagination, growers, landscapers and garden centers have reported increased sales from involvement in the AIB efforts.

– Marvin Miller 

Success or survival of one company in the channel of distribution has implications for partner businesses, and collective dollars can do more good synergistically than dollars invested by themselves.

– Bridget Behe 

Voluntary is good, but I don’t see it working to the extent necessary in this industry. It’s very difficult to get the broad support needed on a fully voluntary basis.

– Gary Mangum 

Collective promotion is very valuable and should be mandatory. The model is there and it has been proven to work.

– Jeremy Deppe 

If 10,000 growers and garden centers provided an average contribution of $100 to AIB, it would increase the budget by 600 percent! With its limited resources, in just five years AIB has engaged over 130 communities and touched 20 million people with its program and message. That is a tremendous impact with little dollars. With a 600 percent increase, the impact would grow exponentially.

– John Holmes et al 

What do you see as the most successful promotions to date?

Flower Possibilities is a good example of voluntary collective promotion that is having an impact. But much like plants, promotions don’t produce an impact overnight.

– Bridget Behe 

A few years ago, the Society of American Florists had really clever posters with bouquets of three different sizes pictured, and the headline asked, "Exactly how mad is she?" I thought that was funny and clever, and exactly the kind of promotion our products need. This kind of promotion of floriculture products needs to go into all kinds of consumer media, and we can only get there if we work as a unified group.

– Kerstin Ouellet

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