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STRUCTURES AND FACILITIES I have outlined the concepts which I believe will help you become a successful commercial grower—no matter what types of plants you choose to grow. But there is one final topic that needs to be touched upon before ending. Although some of you will grow outdoors, almost entirely without the need for production facilities, most commercial growers eventually build some type of structures. And some growers produce their crops entirely indoors in very specialized facilities. Everyone who is planning to grow plants commercially should have a basic knowledge of how to choose and utilize the structures and facilities they may need. The generally high monetary investment required for greenhouse culture of ornamental plants requires that growers develop an intensive management plan to fully utilize their facilities. Many alternative greenhouse production plans are potentially profitable. Growers must select a production program which best fits their particular circumstances (which would include such factors as personal inclinations, facilities, potential markets, climate, etc.). Under present conditions, greenhouse production schemes which emphasize growing for the recreational gardening market are likely to be the most profitable. This segment has expanded more in recent years than other markets (such as cut flowers and foliage plants) and is by far the largest in total crop value. It would seem that a grower is better to bet on a proven winner than to experiment with less proven markets. FGR_85: Specialized indoor greenhouse facility. I will summarize a few general recommendations about facilities shortly, but there is no substitute for first hand knowledge about particular options which are available. I suggest that you review these options by consulting the catalogs of manufacturers and distributors who offer them for sale. These catalogs can be easily obtained free by contacting the companies directly— instructions about how to do this along with phone numbers and addresses and web sites – just Google it! The structures, facilities, and machines utilized to grow crops are a management tool. They help you protect crops from undesirable environmental factors, and they allow you to perform work more quickly and effectively. The only reason you should invest in such tools is if they accomplish these purposes economically. Each acquisition should be carefully evaluated beforehand on the basis of both need and economy. Structures and machines which don’t add to business profits cannot be justified—they merely serve as expensive toys. Climate important: It’s vital to know the local climate before building any structure used for horticultural purposes, especially those intended for protecting crops (such as greenhouses). Records available at the U.S. Weather Service are the best source of information. Additional local weather data may be obtained from state weather services, agricultural departments, and county agents. The usefulness of many horticultural facilities is greatly influenced by weather factors. As you evaluate weather data, pay particular attention to the extreme situations which occur rather than normal conditions. For example, you should be concerned more about maximum wind velocities, snow loads, and temperatures that your facilities must withstand than about the average days which come and go without notice. Be prepared for the worst! FGR_87: Cold frame tunnels used to protect shrubs from extreme cold. Note the open ends on the structures. Too much heat in winter can kill plants. Flexibility important: It’s best to design structures and facilities so that they retain the maximum amount of flexibility possible while still adequately fulfilling current needs. Business requirements will change over time. If your facilities are flexible, they can be modified at a minimum of expense to meet new conditions. Before acquiring any single purpose facility or machine which cannot be significantly modified or used for other purposes, you should examine the entire proposition carefully to see if there are more suitable options which allow greater latitude in choice. Assembly line planning: Workers at a commercial nursery or greenhouse often handle thousands of plants each day. Therefore, the production facilities must be arranged in an assembly line manner to efficiently accomplish the various tasks. A good deal of planning should precede the layout of each individual assembly line area, and you must make sure they all fit together logically in the overall production process. The assembly line in a small greenhouse or tree nursery does not usually need to be organized into a complex technological wonder such as those seen at large automobile factories—but it does need to be laid out in a logical, productive manner. And if special tools or machinery are used, they should be of a quality which allows people to work rapidly. Larger horticultural businesses may be able to efficiently utilize more sophisticated production lines. In its most basic form, an assembly line simply means that work is arranged in a “what’s next” fashion. Every step follows the previous one in a logical arrangement which allows for the most efficient and rapid movement of the product towards completion. Production lines should be designed with a certain amount of flexibility to account for occasional glitches or necessary variations in production processes. Rigidly arranged assembly lines may be extremely efficient for single product production, but they often cannot be used for any other purpose without extensive modification. Classifying the thousands of ornamental plants into neat pigeon holes for convenient study is difficult. There are so many cases where a plant could as easily be placed in one category as in another, and there are numerous examples in which plants fit a particular classification under certain circumstances but more appropriately belong in another under different situations. In spite of the difficulties, it’s informative to classify plants into groups which are defined by particular parameters. The method of classification used here depends upon both the ornamental use of plants and upon major anatomical and physiologic characters. Each name given to the groups supplies readers immediate information about the entire assemblage of plants composing it. We will be using the following classification scheme as we investigate certain topics of interest about each group. • Bedding plants—generally meaning annuals which are planted each year to the garden and into containerized outdoor gardens. • Herbaceous perennials—meaning those non-woody plants used in the garden which have a normal life span exceeding 2 years. • Roses, shrubs, and trees—defined mainly by their woody character but also possessing characteristic flowers in some cases (Roses). All could also be classified as woody perennials. Many are also used as potted flowers (Roses, Azaleas, etc.), and as foliage plants (Palms, Bonsai specimens, etc.). • Potted flowers and cut flowers—meaning those plant varieties which are commonly grown for eventual display of their flowers in the home, office, or other specific sites where decoration is desired. • Indoor foliage plants—commonly composed of varieties having a tropical or semitropical origin which are tolerant to low light levels but also including some plants originating from temperate climates. Certain plant groups such as Cacti, Succulents, Bonsai specimens, and water gardens are often discussed as foliage plants. Although some commercial horticulturists grow and market a great variety of plants with different characteristics and uses, the majority tend to specialize their efforts to a greater or lesser extent. Oftentimes growers specialize in one or more of the groups mentioned above. Specialists are certainly wise to concentrate upon learning all they can about the particular plant groups they work with, but they should also acquire some general knowledge of other ornamentals as well. This information can often be useful as business conditions evolve within the overall industry. It’s not uncommon to see growers and marketers switch from one specialty area to another as circumstances change. An overall knowledge of all the different ornamentals helps business persons evaluate the most profitable crops to emphasize under particular situations. In the presentation of plant groups which soon follows, some reference to specific varieties may occasionally be made, but we cannot begin to discuss the vast range of plant material which is available. Even a superficial study of all ornamental varieties would require many large volumes. Our purpose is to gain an overview of the subject so that you can pursue further detailed investigations. Any person who has been active in ornamental horticulture for many years and who is familiar with at least the broad range of plant varieties now available cannot help but be amazed at the tremendous number of new and improved varieties which have eclipsed older cultivars. Horticulturists who began their career 30 years ago would find only a few varieties that were popular at that time being widely employed today. The ornamental horticulture industry is very lucky because the basic materials with which it works are extremely varied in nature and can be made almost endlessly more so through human manipulation. Thus customers can be offered new and exciting merchandise each year. This is one important source of the public’s continuing interest in plants. Commercial horticulturists who fail to realize the major role which new varieties play in drawing customers are courting disaster. Gardening and other horticulturally related pastimes have been popular in the past and will continue to prosper in the future because there is always something new. Many other industries are not so fortunate: they are dependent upon merchandise lines which may be popular for awhile, but, because of their inherently limited variability, offer little in the way of new products to stimulate continued demand. Whatever group of plants a person works with, much attention must be placed upon discovering the new plants and the new uses which they can serve. This is a central requirement for all commercial horticulturists who hope to survive in today’s extremely competitive marketplace. Not only do horticulturists compete with one another, they are in danger of losing market share to other lines of merchandise which consumers may find attractive at the expense of plants. As long as horticulturists make sufficient effort to take advantage of the natural “newness” inherent in their merchandise, there is little chance of other products gaining in relative desirability. Nature’s variability also touches horticulturists in another way. Although much information about plants can be generalized, it will always be a field which is dominated by local experience. This is because geography and climate conspire to generate thousands of microenvironments to which plants must adjust in order to prosper. Therefore, horticulturists must always relate the information they acquire about plants to the specific climatic situations in which they will be utilized. As you study the different groups of plants, always leave mental room for adapting this information to your local circumstances. The inability to easily find information about plants which pertains to exact situations is often a nuisance to horticulturists, but this is also one of the blessings we inherit. Commercial horticulturists who are knowledgeable about local conditions and the varieties which prosper under them are in great demand. They need have little fear that competitors will render them obsolete. Taking advantage of nature’s variability to sharpen one’s competitive advantage is a primary means by which commercial horticulturists can assure their continued success. Bedding plants: Bedding plants have been the most swiftly expanding crop in ornamental horticulture during the past 2 decades. There are now indications that this growth may be slowing somewhat. Garden plants offer both the producers and marketers a chance to move large volumes of product at profitable prices. It’s a business where significant income can be generated within a short time span. And it often requires very little monetary investment. The exciting profit potential in bedding plants is, however, realized only by a minority of growers and marketers who develop and practice effective policies which consistently provide the consumer with superior products at the opportune time. Modern shoppers are short on time and patience; they want immediate gratification of their needs now! Although price is an important concern to them, it’s secondary in most consumers’ minds to the service objectives mentioned above. Although much of the explosive growth in demand for bedding plants has been fueled by chain stores featuring them as a prominent spring item, it’s doubtful if this practice has resulted in booming profits for the grower supplying these markets or the garden plant department of chain stores. It has certainly caused marginally successful independent producers and marketers a good deal of trouble in the last few years. The bedding plant industry seems to be at a watershed. Continued production and marketing with an exaggerated emphasis on low price and volume cannot continue without serious economic catastrophe for the majority of growers who supply this market segment. Although chain stores, with their great amount of merchandise diversity, may derive some eventual benefit from featuring bedding plants as loss leaders, growers generally operate a one product business and cannot survive unless they demand and receive profitable prices for their single product. It’s doubtful if the majority of larger growers have yet realized the dangerous ramifications of their headlong pursuit of volume through chain store sales. And it’s even less likely that chain store garden managers realize the bottom price for bedding plants is fast approaching. Bedding plant growers simply cannot produce quality merchandise at prices appreciably below current levels. No doubt, the tug of war between producers and chain stores will eventually be concluded with results acceptable to all involved parties. But there will be some dislocations encountered before the problems are resolved—the primary pain will be felt by growers. Wiser growers and marketers are pursuing a course of action which insulates them as much as possible from the marginally profitable segment of the industry just described. These smart operators are concentrating upon producing and marketing garden plant material which cannot effectively be handled through current chain store marketing practices. Hopefully, more growers will gravitate towards a longer range perspective which emphasizes future high profits rather than volume production at any price. Everyone who is involved commercially with bedding plants must strive to give consumers a good product at the proper time. Accomplishing this goal requires meticulous advance planning and scheduling. The product is extremely perishable and truly popular for only a few weeks out of the year. Production and sales records should be analyzed carefully each year in order to determine trends in consumer purchases—this is the only valid measure of what the customer wants. Too many growers and marketers handle the plants they like rather than basing decisions upon the preference of consumers. The short season for bedding plant sales has traditionally been one of the factors which severely limits the potential for good profits. Many growers and marketers are slowly extending the marketing season to an earlier and later time frame. This is being accomplished by carefully scheduling additional product to be available at these times, and then allowing the public to vote with their purchases. In general, this has been one of the most successful marketing strategies of recent years. Anyone who does not participate in lengthening the season of use for bedding plants is bound to lose market share. To a greater or lesser degree, the major comments we have made concerning bedding plants apply to every plant group we shall discuss. The problems and their solutions may vary somewhat, but, basically, the entire ornamental plant industry is in a transitional phase which features the traditional growers and sellers competing with low price volume oriented growers and mass marketers. Neither of these two methods of operation is inherently wrong—in fact, there are opportunities in both. But a good deal more sorting out needs to occur before the two industry segments can comfortably coexist. The main obstacle to healthy coexistence is a lack of understanding by many participants as to exactly what role they should perform. Smaller growers and marketers must realize that they cannot compete head on with mass marketers as regards price. And smaller to medium size growers should realize that adequate profits will be hard to come by if they attempt to wholesale plants to mass marketers. The larger growers and marketers are perhaps more realistic in their present business strategy; most of them realize that their primary objective is volume with an acceptable degree of quality. But there are some larger growers who fail to understand the problems which this strategy entails; it means razor thin profits on huge quantities of merchandise. There is little margin for error on the grower’s part. In a traditionally risky business, this reliance upon small profits can prove devastating when occasional misfortunes arise. Herbaceous perennials: The potential market for herbaceous perennial plants would seem to be quite large. Almost every consumer shopping for garden plants comments that they would like to purchase flowers which don’t require being planted each year. But this theoretical demand does not always translate into actual sales. There are several obvious reasons why total perennial demand sometimes falls short of expectations: 1) Most perennials don’t bloom as continuously through the growing season as do annuals (when this is explained to consumers, they become less enthused with perennials); 2) it’s often difficult to bring many perennial varieties into bloom at the opportune marketing season (impulse sales are thus reduced for perennials as compared to easily flowered annuals); 3) perennials are generally more costly to produce than similar sized annuals (therefore requiring a larger initial investment by the consumer). Conservatively oriented growers and marketers may wish to consider the points mentioned above before they become over-enthused with some of the more optimistic demand reports for perennials. A good many of the favorable comments are undoubtedly true, but it seems that more perennials would be encountered at chain store outlets if the most optimistic scenarios are to be believed. Even if one wished to view the perennial market with caution, there is still a good deal of potential opportunity. The very fact that this type of plant is not seen in mass market outlets in good volume would seem to indicate that more could easily be sold if they were presented properly and at the right price. The traditional means of offering growing perennial plants has been to pot them up very early from large seedlings or from bare root transplants. This results in a big, healthy looking clump during the spring selling season—but it’s an expensive method of production since propagation often occurs up to 1 year before plants are sold. Many consumers balk at the high cost of these larger plants. There has been some tendency to offer somewhat smaller plants, but seldom does one see perennials being sold as juvenile transplants in the same manner as most annuals are marketed. It would seem that there may be a tremendous market for small perennial transplants. Many varieties can be grown on the same schedule as popular annuals, therefore making these particular perennials cost competitive. Perhaps the major reason such perennial plants are seldom encountered is simply that few growers have broken with the time worn methods of production. Since perennials are seldom marketed in great volume by chain stores, these plants are often a high profit item for independent garden centers. Less competition means it’s easier to sell at a good price. Most temperate region perennials are quite cold tolerant; in fact, many varieties must be grown very cool to develop properly. This means that perennials may often be grown and marketed by people who lack greenhouse facilities. It’s one of the least expensive methods of becoming a commercial plant grower—the main ingredients being a good deal of hard work and a small plot of land. Actual monetary outlays can be minimized by careful planning of the operation. The thousands of perennial varieties offer individual growers and marketers alike a chance to establish themselves as experts in this field. Seldom will larger diversified growers and mass marketers feel inclined to handle any but the more popular cultivars, thus leaving a clear field for smaller entrepreneurs to exploit the large majority of perennials. One fact which should be mentioned about perennials is their general suitability as mail order items, especially if shipped in the dormant state. Every horticulturist is familiar with the numerous magazine advertisements for perennials which occur nationwide each year. It’s obviously a good business method for many people and one which every perennial grower should consider. Mail order has many benefits to offer beginning entrepreneurs, but the ins and outs of this selling method must be carefully investigated in order to assure success. Every person who intends to grow or sell perennials locally must take into account the large number of plants sold through mail order. This competition negates, to a certain degree, the general scarcity of perennials to be found at chain store garden departments. Various horticultural experts often campaign for garden plants to be sold in the younger stages so that they become more fully established before flowering occurs. While this may be a worthy cause, it is, in general, doomed to failure. Anyone who has observed consumers shopping for plants knows that most people are irresistibly drawn to plants which are flowering profusely. This may be the single largest stumbling block in the way of perennials becoming a truly massive crop— it’s very difficult to bring most perennial varieties into bloom at the opportune marketing time. Thus the impulse buying potential of perennials is largely lost. This fact must be considered in any perennial growing or marketing plan. Roses, shrubs and trees: The market for woody plants is perhaps even more distinctly separated into service-oriented and volume- oriented segments than are the markets for other ornamental plants. In general, most woody plants can be rather easily handled as a commodity type item by chain outlets. If reasonable efforts are made to care for woody plants, these outlets can offer the consumers a very acceptable product. Bedding plants, perennials, and flowers (as compared to woody plants) usually require more detailed and timely attention so that it’s especially difficult to offer a good product under chain type marketing conditions. FGR_99: Tree growers must focus on service and expertise. The point of the previous statements is to emphasize once again that independent woody plant marketers must concentrate (even more intensely than other independent horticultural retailers) upon service and specialized products. The thousands of woody plant varieties necessary for varied geographic areas and landscape purposes offer a distinct opportunity for independent nursery owners to display their expertise. Independents may also choose to handle especially large-sized landscape plants which are inappropriate to mass marketing channels. The independent operator has many such advantages to emphasize—this is the only realistic means of competing against the price and volume strength of chains. One aspect of woody plant production and marketing which has not received sufficient attention is the eventual survival and vigorous growth of plants in the final landscape. Most retailers and consumers assume that if a plant is adapted to the climate and looks healthy it will grow into a beautiful specimen in the landscape. This is not always the case. Many containerized and otherwise root-restricted plants never develop properly because the root system has been injured by one or another means. The cause of injury may often be physical restriction of roots by the container or temperature extremes in the root zone. In other cases the roots have been excessively pruned prior to planting. Whatever the cause, the eventual disappointment of customers is a serious problem for the industry. Potted and cut flowers: Flowering plants and cut flowers have traditionally been the staple crops of most year-round greenhouse growers in temperate North America. These crops were often sold at on-site retail facilities. While this scenario still persists to some extent for potted flowers, it has changed completely in the cut flower arena. Many potted flower growers still grow for their own use or for local independent retail shops. These growers usually produce a varied line of crops and stress high quality plants for traditional flower shops. Another group of growers has now emerged which emphasizes production oriented towards mass market outlets. While these latter growers and marketers are certainly concerned with high quality, they also stress volume production and low prices. This is the old two tier marketing system we have spoken of several times. Local cut flower production has been reduced many fold. Fifty years ago, this was the most important greenhouse crop; now it’s dominant only in a few isolated instances. In certain areas of California and Florida, cut flower crops are still big (both in the greenhouse and in outdoor fields), but a great amount of production has shifted to foreign locations such as Columbia, Israel, Spain, Australia, and The Netherlands. The ease with which cut flowers can be shipped by jet freight has tended to concentrate their production in the most desirable and economical locations throughout the world. As a result many cut flower producers in the United States have gone out of business or shifted to other crops. Mass market outlets have been aggressively selling potted flowers for many years, and they are now heavily into cut flowers. Therefore, we may assume that the equilibrium between independent retailers and chain stores is fairly well-established in this product area. It can easily be seen that independent flower shops are holding their own quite well, especially those which have emphasized a profitable niche which cannot be duplicated easily by chain outlets. Some independents have certainly experienced hard times or even gone out of business, but most are flourishing. This situation shows what we may expect to happen in other areas of ornamental horticulture as the relationship between chains and independents matures. Each will hold onto that proportion of the market which it can serve best. Neither one will cause the other to become extinct. While independent retailers have been able to hold their own, smaller growers of potted flowers have been hard hit by mass production growing methods. Many of them have been able to survive only by emphasizing spring bedding plant production more heavily. Larger growers have turned some crops into low price commodities in many areas—Poinsettias, Mums, and Easter Lilies are examples. There are indications that this situation is easing somewhat as prices approach the lowest possible range which is profitable. Certain volume producers have been forced out of business due to insufficient profit, while others are scaling back production to more realistic figures. Indoor foliage plants The indoor foliage plant industry is an example of what can take place when too much emphasis is placed upon rapid expansion. In the 1970’s and early 80’s, foliage plant consumption increased greatly, but production increased even more quickly. Not enough attention was focused upon product quality and upon long range plans to provide a stable basis for the industry. When consumer demand for foliage dropped slightly in the early 1980’s, there resulted a severe oversupply of plants. Many growers were forced out of business and some marginal retailers curtailed their involvement with foliage plants. Only the stronger growers and marketers remained on a profitable basis. This scenario is perhaps being replayed in the bedding plant and potted flower industries today. It illustrates the folly of turning ornamental plants into a commodity rather than aiming production and marketing towards creation of a special status for these items. Even with the shake-out which occurred in the foliage industry, there are today many growers and retailers who have adapted profitably to the new circumstances. Foliage production offers one great advantage in that it can be carried on year-round in both southern tropical locations and in northern greenhouses. But in order to prove profitable, it must be done efficiently and with careful advance planning. Quality must also be emphasized. FGR_103: Pothos are a popular foliage plant. Even in northern greenhouses with high fuel costs, local growers who manage and market their foliage crops carefully can make money. This is not an easy task since competing southern growers can ship material north quite economically, but it can be done. One of the main quality problems in foliage plants is the lack of acclimatization for material shipped out of southern growing regions. A good amount of these plants are not prepared properly for market. Vigorously growing plants which are shipped directly to retail outlets generally don’t perform well in the indoor environment. They are not acclimated to lower indoor light levels. This situation results in less than desirable performance for consumers and a generally poor reputation for foliage plants. Such a situation inclines many people towards choosing silk or plastic plants for display. The key to a healthy foliage plant industry is plenty of emphasis upon quality. The introduction of new varieties is also essential if the continued interest of consumers is to be expected. FGR_104: Spider Plants are an attractive seller. PLAN EARLY FOR FUTURE PROFITS Growing plants, trees, and flowers profitably is not an easy task which can be accomplished overnight. Hopefully, the outline of business, marketing and plant production concepts which were presented above will save a lot of time by pointing you in the proper direction to solve the many specific problems which must be dealt with as you build a successful horticultural business. By starting now to lay the basic groundwork for a venture, you can almost guarantee that specific future projects will be accomplished easily and quickly as the need arises. There is no sense in concerning yourself with numerous details at the beginning; they will only serve as distraction from more strategic long term objectives. |