Update: Dümmen Orange Acquires McHutchison and Vaughan’s Horticulture; Here’s What it Means
Dümmen Orange announced on Nov.1 that it has acquired McHutchison and Vaughan’s Horticulture, U.S.-based wholesale plant brokerage firms, to fulfill its strategic ambition for enhanced distribution and customer reach.
Greenhouse Grower caught up with Dümmen Orange North America Operations Director Kate Santos and Mike Tizio, CEO of McHutchison and Vaughn’s Horticulture, to find out more details about the acquisition, including the reason for the sale, and how it will affect both businesses and the broader horticulture industry going forward.
“We are innovators who want to bring better green products to our customers and we want to do it in better ways,” Santos says. “We see this acquisition as an opportunity to build a sustainable platform for the distribution of our current and more importantly our future floriculture innovations. This acquisition aligns us with an organization that will help us expand our reach to grower customers across the U.S., thus helping us serve our customers better.
“We also intend to use this platform to test and innovate new distribution strategies to the market, such as bundling our new innovations with our core traditional offerings in order to establish consistent product value across the marketplace.”
Tizio says he welcomes this development and supports this next step in the evolution of both organizations.
“We wanted to align with one of the most respected leading breeder companies in our industry, which will deepen our product knowledge and offer us stronger back-office support that allows us to offer our customers and vendors better service and help us grow our business,” he says. “We look forward to the expanded product offering and the technical and marketing resources that Dümmen Orange will offer our team to help grow our business.”
Dümmen Orange CEO Biense Visser says the new partnership will provide better distribution of new and current product lines.
“The McHutchison and Vaughan’s Horticulture acquisition increases our customer reach, while also facilitating the introduction of new products like calla lilies, phalenopsis, and grower solutions.”
Companies Will Continue to be Managed Separately
The initial announcement emphasized that Dümmen Orange breeder activities and McHutchison and Vaughan’s Horticulture brokerage activities will continue to be managed and operate as autonomous business units.
“Dümmen Orange North America will continue to operate under an open platform of distribution through all of their current broker partners to promote and grow existing business relationships and ensure customers interested in Dümmen Orange products continue to have a choice in their preferred suppliers,” Santos says. “Similarly, McHutchison and Vaughan’s will continue to provide a full service offering to their grower customers by developing their valued third party vendor brokerage relationships.”
Despite the partnership, both organizations want to ensure their existing broker and breeder business partners that there will not be any preferential treatment between the two companies.
“This is why the brokerage and breeding business will be maintained as separate sales units and we will not offer preferential pricing to the McHutchison and Vaughan’s team,” Santos says. “We highly regard all of our broker partners and the support they provide us in promoting and selling Dümmen Orange product across the country. We intend to continue to work with each of these partners to not only sustain our current business with them, but to grow it.”
Tizio adds, “Both companies will continue to prioritize customer needs and offer their customers choices through a full selection of genetics in the case of McHutchison and Vaughan’s Horticulture, and a full selection of preferred brokers to work with, in the case of Dümmen Orange.”
Because of Dümmen Orange’s rapid expansion, doubling in size since 2015, Santos says the complexity of the breeding company’s portfolio of products has also increased, considering many of its products have non-traditional distribution models.
“We needed a platform to support our growing portfolio, where innovative distribution strategies could be tested and implemented to streamline supply for our customers, in order to protect the value of our new innovations and continue to support the market with our traditional products in a sustainable way.”
The expanded customer reach through the McHutchison and Vaughan’s Horticulture acquisition will support Dümmen Orange in realizing these objectives.
“While we see this acquisition as facilitating delivery of our key new introductions into the market, the overall alignment of our offerings is not contingent upon this purchase as we continue to strive to align our global product offering for local markets where demand exists,” Santos says.
McHutchison and Vaughan’s Corporate Structure Will Remain Intact
The McHutchison and Vaughan’s Horticulture sales force will continue to operate as always – providing high-quality service and the best products for their customers, including a full selection of genetics, regardless of the supplier that provides them, Santos says.
“The leadership team at McHutchison and Vaughan’s Horticulture (Mike Tizio, Scott Crownover, and Keith Cable) will all remain in their current roles, and are all excited to continue leading McHutchison and Vaughan’s Horticulture into this new opportunity,” Santos says. “The Dümmen Orange leadership looks forward to supporting them in continuing to drive the company’s success.”
In addition to being an opportunity for both companies, Santos says this new partnership will be advantageous to Dümmen Orange’s and McHutchison and Vaughan’s Horticulture’s vendors, customers, and stakeholders.
“Together, we are able to reach every corner of the U.S. market, we are able to better understand customer needs and wants, and are able to better serve these customers and
provide better support for them through the entire value chain,” she says.