Some growers have been buying hard and live goods more conservatively this year as a result of 2008. What are the reasons? How will their buying habits affect the spring season? We recently caught up with Dave Watt of Express Seed Company, general manager for the live goods broker based in Oberlin, Ohio, who offered a few thoughts on recent buying trends he’s seen.
Why are buying habits more conservative for live goods this year compared to past years?
“Growers are viewing this year as a correction with their planning. I think we’ve had unusual circumstances in the way we’ve broadcasted concerns over the economy. The action being taken is just a maturing of many discussions that have been going on over the years–discussions about pay by scan, at-once ordering, cost-effective planning and maybe most importantly, the shrink factor. The reaction is all part of that, and it’s come a little bit to a head because of all those circumstances combined.
“I think through that, you’re going to find a more conservative nature this year that should correct things.”
Have you seen conservative bookings already? Are you anticipating them?
“I see continued growth for our company with our customers, but it’s all coming at the same time. Any conservative aspect of the bookings is occurring on the shoulders. I saw a lessening in product demand for that part of the season.
“On the peak side, people are still bullish. You have to think about what the products are early on and after the peak, or what your shrink is. What happens early on if there’s a snowstorm? In the past, at least in our part of the country, you might say I need my product up here as early as April 1 to hit certain markets. If it doesn’t snow and the weather is good, everybody’s going to be saying ‘I don’t have enough ready-to-sell products.'”
Are growers looking for more flexibility in payments?
“First of all, I think our industry is sound. I think our grower base has to make business adjustments the same way every other business has to make today. There are business management decisions that need to be made and adjusted continually in a moving market.
Are there common mistakes growers are making when it comes to ordering?
“Growers have, perhaps, waited to book some products in a manner this year that the supply side wasn’t prepared for. The suppliers we use who produce cuttings and seeds and so forth might not have been as prepared for delayed ordering. As a result, when their orders came through, there had to be a lot of additional inventory management manipulation.
“If the supply sources are not in tune with a grower’s conditions or situations, there’s going to be a breakdown somewhere. Our effort over the last seven years has been to tighten up the supply chain as much as we can. We’ve tried to contribute to a more efficient planning process, and we think this is kind of an unmeasured cost. But there are a lot of costs that go into trying to manage orders for availability that were never planned for.
How will this year play out?
“I think it’s going to be a good year. My hope is growers are going to come through this year in a healthy light. I’m hoping for good weather and good sell through at the store.
“As an industry, we have a tendency to swing the pendulum way too far if we’re following up a good year. We swing the pendulum too far the good way. You have to strike a balance somewhere.”
Do you have any last-minute advice for growers?
“Not necessarily advice, but an opinion: Work with suppliers who have a real keen interest in keeping you healthy. That’s really the No. 1 objective for the supply side of our industry: Keep the grower healthy, and we will all stay healthy.”