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To all the dreamers who want to start a nursery

Posted by marooned z9 Ca (My Page) on
Tue, Jun 27, 06 at 11:35

Whenever someone comes to this forum with the dream of starting their own nursery the most commonly suggested starting point is "So You Want To Start A Nursery" by Tony Avent. Well, I have read Mr. Avent's book and now I would like to offer some of my own observations.

First of all, 95% of that book is geared towards operating an extremely large scale nursery. It assumes that you want nothing less than for your nursery to grow into a six-figure-profit producing giant monster of greed. It covers such subjects as multiple massive greenhouses, administrating an army of employees, and having a fleet of tractor-trailers. I'm sure this information is quite helpful to anyone seeking to establish a horticultural empire, but to the man or woman who is content with just maintaining a small business or hobby, all of this information is irrelevant.

I will go on the assumption that it is not the intention of most people to rival such powerhouses of plant production as Jackson & Perkins. I will assume that your success and happiness is not measured by how many sports cars you can fit into your garage or by how much jewelry you can afford to waste money on. For you, I will recommend another book: "Growing Profits: How To Start and Operate a Backyard Nursery" by Michael and Linda Harlan.

This husband and wife team made their living for more than a decade on a mere half-acre of land. I had the priveledge of meeting them last year when I attended their one-day class at the local community college. They are good down-to-earth people and the advice they have to share is perfect for those who simply want to earn some cash by doing what they love.

If you're looking to start a corporate empire, listen to Tony Avent. If you're looking for something else, listen to the Harlans.

Good luck in whatever you choose to pursue.

Here is a link that might be useful: Growing Profits: How to Start & Operate a Backyard Nursery


Follow-Up Postings:

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RE: To all the dreamers who want to start a nursery

Hi Marooned,

Sounds like great advice! Thanks for sharing.

Blessings,
Beth


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RE: To all the dreamers who want to start a nursery

I couldn't disagree more, both books have good information. Although I'm quite sure the Harlans have earned more income of selling the book then selling flowers. But without financial disclosure I can't say for sure. But it would be interesting to find out. If the nursery you started is successful you will come across quite a few of the issues discussed and knowing about them upfront is very useful. Knowledge gained is knowledge gained. You make allot of assumptions of people and their intentions.

Unfortunately I can't help to think that this is just another plug to sell more books. How many other sites has this been posted on? And yes that is an assumption too.


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RE: To all the dreamers who want to start a nursery

There is a huge difference between a business and a hobby.
Would you work in a factory for free? In a store? As a dental receptionist?
Then why would you look to starting a business from which you don't want or expect to make money?
Being small doesn't mean you aren't profitable. But anyone running a business who doesn't take it seriously is a drain on the industry. You will be competing with honest men and women who do need and do expect to make a living from their work and their business.


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RE: To all the dreamers who want to start a nursery

mylu:

They made their living exclusively from their backyard nursery for 10 years. Now Michael Harland has become a teacher and they have stopped operating their nursery.

ninamarie:

Of course you would want and expect to make money. But what may seem like too little money to some may be enough money for someone else. Do I care about owning a $50,000 car? No I don't. Therefore I do not need the kind of income that would be needed support that kind of extravagant lifestyle.

Some of you find happiness in material things. I find happiness by living in the country, growing plants, and having friends and family. If I can have all those things by only making $25,000 a year, then why would I feel the need to make $100,000? What would I do with all that extra money besides show off to people how much money I have? If I have to be wealthy in order to impress them, then they are not worth impressing to begin with.


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RE: To all the dreamers who want to start a nursery

Um how about putting it away in the bank for your kids and wife/husband god forbid something should happen to you? Retirement? Medical expenses if you or a family member should fall ill? Money in the bank incase your nursery should come across bad times or get sued...Or perhaps the weather takes out a greenhouse or two.

I don't think your looking at the industry in a realistic point of view.

My father-in-law is quite wealthy but you would never know it if you met him. His car is 7 years old. You can have both. Just because one makes decent money does not mean they live an extravagant lifestyle. Where do all your assumptions come from?

I wonder why they stopped running their nursery after 10 years?


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RE: To all the dreamers who want to start a nursery

  • Posted by cady 6b/Sunset34 MA (My Page) on
    Wed, Jun 28, 06 at 17:33

I believe that Avent's book has excellent advice that is applicable to any scale of endeavor. The principles are the same, whether for a backyard greenhouse or a big operation.

You will still need to understand everything about management, technical issues, horticulture, marketing and materials. Just scale down everything to whatever size operation you're dreaming of.


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RE: To all the dreamers who want to start a nursery

  • Posted by bboy z8 WA USA (My Page) on
    Wed, Jun 28, 06 at 23:47

I second the last remarks.


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RE: To all the dreamers who want to start a nursery

Ditto.


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RE: To all the dreamers who want to start a nursery

I am the tiniest of tiny home grown businesses - you could say a micro-biz. I sell stuff I grow myself in my own backyard. Whatever interests me at the time, whatever catches my eye and I only go to market when I feel like it which isn't ever single weekend. Do I make money? - a little. Is it worth it? - heck yeah! I love it. Would I wish it to be more profitable? of course I would. I want it to be my ONLY source of income but that just isn't realistic.

People come on this forum posting their questions because they have no idea where to start - they only know that they love to garden (it is quite addictive after all). They want lots of information concerning all the aspects of the horticulture industry. There are number of books out there that include this type of information. None of them answer all the questions for all the people. Each person has to do the research and gain the experience for themselves. Suggesting a book is only the starting point. There is no need to "put-down" one book and wave another in the air as if it contains all the information someone, somewhere might be needing. There are plenty of business ideas out there that have NO books that offer starting points, we should be happy this field of study has quite a few.

And for the record, Tony lives down the street & around the corner and he drives an old minivan.


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RE: To all the dreamers who want to start a nursery

"Based on personal conversations with nursery owners across the country, I have discovered that a small full-time nursery with no employees can probably generate gross sales of at least $50,000." - Tony Avent


If you have a small nursery with no employees that grosses $50,000 and still doesn't make a significant profit, then you are doing something wrong.

This is what it costs me to grow one rose from a cutting to a one gallon container in one growing season:

.45 - one gallon nursery container
.10 - one gallon planting medium
.17 - fertilizer
.12 - pest & disease control
.02 - rooting hormone
.03 - nursery & business licenses
free - water (it comes from a well)

Total to produce one rose for sale - .89
Selling price - $5.00
Profit - $4.11

And that's just for the common everyday rose. My exotic plants sell for much more money, yet they are no more expensive to produce. Who says money doesn't grow on trees? It certainly does!

The best part is, I would do it all for free if I didn't have to feed and clothe my family. I love gardening, and that's all a small nursery business is - gardening for profit.

I spent most of my life busting my ass working to make someone else rich. I've loaded furniture onto trucks for twelve hours a day. I've worked in a machine shop. I've been a welder. And I've been a U.S. Marine, protecting the liberties of people who are not willing to make sacrifices themselves.

There is no other job on this earth that I would rather be doing today than working for myself in my own garden. Screw all the people who tell you it can't be done. Those are the people who either would rather have you working for them, or they are the people who just don't have the heart or the balls to make their own dreams come true.


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RE: To all the dreamers who want to start a nursery

I don't want to dash your dreams, but there is reality. I'm a part owner in a small nursery (7 years), have been in the military for the last 19 years and I do have the heart and balls to make my dream work, here are some of the realities I've experienced. I do think that that $50,000 of gross sales is accurate. Your numbers don't include important things like the electricity to run the well pump, advertising, insurance, Uncle Sams cut, greenhouse(s), shade house(s) plus a lot of everyday expenses that you never plan for but always come up, not to mention your pay. Once you actual start you'll be doing good to make $3.00 a pot using your scenario. To make the $25,000, you'll need to sale over 8300 pots. To maintain 8300 pots, water, weed, fertilizer, propagate, move, and worry over until big enough to be sold takes considerable time and money. Once those 8300 pots are ready to be sold you have to find enough people willing to buy within a reasonable amount of time. If they don't sell then you'll have to repot in larger containers, more time, money etc... Can you make a living from it, sure, but it's not nearly as easy as some books make it sound. Go for your dream, just be realistic.


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RE: To all the dreamers who want to start a nursery

Marooned,
Are you changing your story? I can't believe your quoting Mr. Avent??? Quite frankly I'm not sure what your point is now.
From your last post I think you may need to reread Tony's book to get a more accurate cost of growing your plants as plantman said. Do you use any form of accounting to verify and record your cost?

TJ,
This was funny...
"And for the record, Tony lives down the street & around the corner and he drives an old minivan."


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RE: To all the dreamers who want to start a nursery

Interesting! i have both books mentioned and have learned from both of them as well as from many informative web sites. I still don't know everything I want and need to know. We sell only daylilies and I would like to sell other perennials that we can have folks come, choose and then dig them for the customer right then and there. I just don't want to mess with the pots, greenhouses, etc on a large scale. (I would love a small greenhouse just for fun!) But I am having a terrible time trying to find out just what can be dug while in bloom like daylilies can. i wish there was a book about that.
VG


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RE: To all the dreamers who want to start a nursery

Well vegangirl, I've found hostas to be more tolerant than daylilies, and they are certainly popular. I had one that was growing in rock-hard red clay that I felt sorry for. Obviously I put it in the wrong place since it was getting many hours of sun. I dug it up for my sister and divided it on the spot. I left a small clump behind and really didn't bury it well because I was in a hurry. I never did go back and fix it and darn if that hosta didn't grow right back, even in those terrible conditions. They aren't all like that, but many varieties are amazingly tough. To look good, most of them need shade for a good part of the day, so if you don't have trees you would want to provide some shade.


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RE: To all the dreamers who want to start a nursery

laurabs,
We've had several daylily customers ask us if we plan to start growing and selling hostas. I'll have to seriously look into that!
VG


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RE: To all the dreamers who want to start a nursery

To Marooned,
Who wants to buy your rose stick in a gallon pot without a color label?


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RE: To all the dreamers who want to start a nursery

Money isn't the issue, motivation is.

How much is enough is very dependent not only on your stage of life, personal committments and the area you live in but also on your committment level to think outside yourself and give something back.

I pay more than $25k per year in childcare expenses. To afford a moderate home, clothes, food, car, medical expenses, etc in my area and have enough to give back to charity I need to have income exceeding $100k/yr.

I feel blessed to say I can give 10% of my income to charitiy now while living on the other 90%. My personal goal is to flip that around so that I can meet my family's needs comfortably on 10% and give 90% (not my original idea but inspired by someone already doing it).

Employers have the awesome responsibility & opportunity to provide a means for their employees to earn a living to support their families. That's one way of giving back that you will never do if you limit your thinking to your own needs.

You can do it and that's OK if that's all you want, but I have higher goals.


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RE: To all the dreamers who want to start a nursery

I write a blog called 'The Blogging Nurseryman, the art of running a small garden center or nursery'. Over the last few years we have been having a on going conversation on just what you are asking about.

We are a small operation in the foothills of California, just outside of Sacramento. My wife and I run the nursery with seasonal help. I have been in the retail nursery business for over 29 years. If you interested come on over and check it out.

P.S. That figure of 50,000 in gross profit wouldn't make it here in northern California. Regional differences are very important when it comes to being profitable.

Here is a link that might be useful: The Blogging Nurseryman


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RE: To all the dreamers who want to start a nursery

  • Posted by bboy z8 WA USA (My Page) on
    Wed, Dec 26, 07 at 13:41

>To afford a moderate home, clothes, food, car, medical expenses, etc in my area and have enough to give back to charity I need to have income exceeding $100k/yr<

I saw somewhere recently the claim that $180,000 per year was now needed to maintain typical middle class lifestyle. Maybe it was another thread on this web site, I don't remember.


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RE: To all the dreamers who want to start a nursery

I see flaws in the stated profit from selling those roses too.
Not every cutting I stick survives, maybe I'm not so good. I have shrinkage with my crops.
I can't always figure out exactly how many will sell and become marketable plants, sometimes I have to carry some over, or sell some at a reduced rate if I'm carrying too many.
I have to use electricity to pump my water, and I have fans to cool the greenhouse, inflate the poly that use electricity too.
I have to buy water hoses, nozzles, irrigation, benches, plastic, high tunnels, plant tags, paper clips, office supplies, signage, things that have nothing to do with that rose plant directly, but those things have to be purchased for my business to run properly.
If customers come to the house, I have to have insurance for liability.
If I take them to the farmers' market, I have transportation costs and fees for the market and insurance for liability.
Since I live in Indiana, I might have to heat a little, or more likely a lot! at the beginning of the season to have that rose ready for peak market time so I can pull in those big bucks.
Since the japanese beetles hit here, now you can't hardly give away roses since they are one of the beetles' favorite foods...and since every grocery store, home depot, lumber company and store carries all the normal varieties for a fraction of what you can produce them for, you need the more interesting new varieties to sell. You better not be propagating those because they're all patented!!!
I'm not saying that it's not a good job to have a nursery/greenhouse, and that it's not got it's good points. But please go into it with your eyes WIDE open and know that it's not all $$$ and fun.
I'm in my second year now and I still haven't made a profit with all the investments up front, and the mistakes which you inevitably make--no matter how much research you do first. And I work my butt off, and worry when the wind blows too hard, it snows, and you hear reports of hail a few counties over. Or it's too hot, or too cold, or they open a new Walmart with a huge garden center 1/2 mile away (which really did happen!) or whatever.
Be realistic and set a realistic goal. I think starting out it's more of a five year plan....
Sandy Burrell,
Northen Tropics Greenhouse


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RE: To all the dreamers who want to start a nursery

  • Posted by pew63 6b, Trenton, NJ (My Page) on
    Tue, Jan 1, 08 at 14:21

For anybody interested in starting a small nursery (from an old gas station) you might check out the 'Tangletown Gardens' website. They have remained small, building-wise, but have expanded their services.
I had the opportunity to visit the garden center about a year and a half ago and was impressed with their inventory on such a small space of two city lots. Although they own their own offsite greenhouse facility, one could rely on other wholesale vendors.


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RE: To all the dreamers who want to start a nursery

  • Posted by bboy z8 WA USA (My Page) on
    Tue, Jan 1, 08 at 19:47

>I'm in my second year now and I still haven't made a profit<

6 year startup phase has been said to be typical for a new garden center.


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RE: To all the dreamers who want to start a nursery

I started my own business up seventeen years ago now. I can tell you it's harder to make a profit doing this today than it was back then. I went to a profit situation two years after start up and my sales were for many years right in line with the projections I made when I invested the capitol and risk.

Running a nursery/greenhouse/garden center is as different from growing plants in your back yard as running a restaurant is from cooking supper in your own kitchen. Not that somebody can't make that transition successfully, but not everything you might be accustomed to doing on a personal level can be directly translated into doing on a commercial level. Don't ever expect to be treated as anything than an amateur if you start out small, no matter how much training or experience you have....you often need to suck it up until you eventually prove yourself. And I can tell you from experience, the typical customer now adjusts their expectations from the box store experience. Please follow the demographics of your market carefully. It has changed tremendously in the last two decades.

The larger return you anticipate, the larger risk involved in your venture, so hedging your bets is a wise decision. I strongly recommend getting your feet wet in the industry before you strike out on your own. Better to know beforehand who your vendors are, what skills you need to learn or hire, what constitutes your prospective market, who is your competition.

I really think there is as much room for bright new ventures as there ever was, but how successful you'll be will be strongly tied to how well you prepare yourself for marketing your product. You are not going to compete with a box store by simply being a smaller version of it. You need to be flexible enough to know what they are not giving the public which you can. Then you have to be wise enough to really know if the public will pay for those services. It might not be as important to them as you imagine. Fresh ideas on niches are going to be where it's at.

It's a rough, but very rewarding experience. If I had to do it all over, I would not have changed too many things and I'd do it again. But, every couple of years, I am obliged to change my business plans, my customer base, my product line. I've had to make compromises to keep costs down, grow things I don't necessarily enjoy growing, and learn to reduce shrink to almost nothing. If you don't keep up on what is happening to the industry as a whole, you might not know many of the "big boys" have been falling like flies over the years, and they have the advantage of excellent hiring pools, quantity discounts, a "name". They close and they consolidate. One of my fav wholesale vendors has just done this in the last few months. The little plant businesses are in the same situation as the little restaurant, the independant hotels, whatever. It's all about chains. The most important thing you have going for yourself is flexiblility, and a direct, literally touchable access to your customer base.

Good Luck.


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RE: To all the dreamers who want to start a nursery

After realizing my dream of starting my own Garden center, I am ready to begin a new phase in my life. i have decided to sell my Dream and stay home and babysit by Grandbabies who are currently in daycare.
Anyone interested in running a small nursery in beautiful, North Idaho, click below to see the "for sale" listing for my Nursery...Happy Dreaming!
http://spokane.craigslist.org/bfs/529570861.html

Here is a link that might be useful: Nursery for sale!


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RE: To all the dreamers who want to start a nursery

Sandy,
You raise some good points about the particular risks associated with this industry. As with any business, understanding risks and having a plan in place so you know how you will deal with them BEFORE you have to deal with them is a critical piece of business success. This industry has some unique risks in environment (insects, disease, weather) that pertain only to those in this industry. It also has general business risks typical of any retail endeavor like the "big box" moving in next door.

The trend toward plant patenting is one that I'm interested in exploring further because I deal with very similar issues in my present industry. Today I manage teams who develop software products and patent/licensing issues abound in that space.

Maybe one of you experienced garden center owners can enlighten me. I wonder how much of these patent issue are brought on by depending on the large scale wholesalers? Can a nursery business really expect to be successful while depending on the limitted product choices of these companies which require you to prominently display their branding instead of your own store's brand?

As a consumer, when I see one of those brands on the pot, my first instinct is "it's overpriced, somebody else will sell it for less" followed immediately by my second thought "it's common, everyone else sells it". My sense is that those products fall into the "volume" sales category where margins are limitted and profitability depends on selling high volumes at low margin (even if the wholesaler tries to convey that they are "value" products). It seems the more profitable area is, as calliope noted, in the "niche" markets where "value" products (the unique and hard to find plants) sell at higher margins.

The other area that has been highly profitable in recent years is services. A successful garden center/nursery business will have the right mix of value/volume/services. How do you figure out what the right product & services mix is?

BTW, mergers and aquisitions are a sign of the economic cycle we are in. They are happening in all industries, not isolated to the garden/nursery. Right here I've learned from an insider that 2 of the 3 major garden centers (both $10M+ in annual revenue) are looking for buyers for their retail units. My guess is that they grew to a point where they followed industry advise to split into separate business units and have found that retail is their least profitable unit. I'm not convinced yet that retail can really stand alone w/o wholesale/growing/services in some degree.

Thoughts and industry wisdom in this area?


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RE: To all the dreamers who want to start a nursery

"As a consumer, when I see one of those brands on the pot, my first instinct is "it's overpriced, somebody else will sell it for less" followed immediately by my second thought "it's common, everyone else sells it". My sense is that those products fall into the "volume" sales category where margins are limited and profitability depends on selling high volumes at low margin (even if the wholesaler tries to convey that they are "value" products). It seems the more profitable area is, as calliope noted, in the "niche" markets where "value" products (the unique and hard to find plants) sell at higher margins."

The reason why you are seeing those branded pots is because it is the norm, in today's retail nurseries, to buy your product from the wholesaler. Not many nurseries out there are able to grow their own product and sell it at a competitive price (some still exist, just not many). The pricing is not an attempt to gouge the customer, your business would fail quickly if that were the case (and I'm sorry you feel that way). The pricing is to stay competitive against other nurseries and make enough profit to keep the doors open for another year. If you think that raising your own stock, and then undercutting your competition can be profitable; then best of luck to you. I've done the math, I think you'll have a hard time turning a profit.

Also, from someone who works in nurseries. I find that people who are looking for the unusual are unusual! What I mean is: even if you stock your shelves with that rare, collectible, or show-stopper plant; you only get so many customers looking for it. Even then they only buy one or two of those exotics before picking up 8 Early Girl Tomatoes on the way to the register. Your bread and butter comes from Early Girls, Wave Petunias, and whatever they mentioned on the local garden show. I believe you can have both at any nursery, but I know at the end of our season, I'm discounting or throwing away more of those collectors plants than the standards.


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RE: To all the dreamers who want to start a nursery

  • Posted by bboy z8 WA USA (My Page) on
    Thu, Jan 10, 08 at 23:33

Yes, many people buy only what they are already familiar with but something is driving the flood of novelties that are being churned out these days. If your operation can't sell these maybe you need to look at how your merchandise is being presented.

It may be an urban thing, too, with rural markets seeming to be less likely to respond to anything other than same old same old. Or maybe it's just because there's more people packed together in a smaller area than out in the sticks, so you are more likely to have someone wanting something different to show up because you are having a greater volume of people of all interests come through.


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On My Forehead

  • Posted by bboy z8 WA USA (My Page) on
    Thu, Jan 10, 08 at 23:55

Is where I needed to be displaying

You are not going to compete with a box store by simply being a smaller version of it

when trying to help two different friends at two different widely spaced intervals get garden centers going. Both had similar bad ideas despite being widely separated in time and space - my presence, unfortunately, being the principal obvious common element - and didn't get good results, including trying to beat the problem of staying stocked by having someone else keep them partly supplied by prior agreement. In the first instance the stuff ended up going to somebody else and so we started off scrambling for material, in the second the regular weekly delivery was more weakly than weekly, much of the stuff being low in both quality and quantity.

>But, every couple of years, I am obliged to change my business plans, my customer base, my product line<

Clearly that is SO important also. I check trade publications periodically at a local library and it seems there is always talk about trends and staying on top of them. The two I tried to help both also seemed to think they could start off with a limited knowledge of what was involved and get by on that. Maybe pick it up as they went. Of course, I was supposed to provide some insight, for what that was worth it might have worked fine until I started being argued with.

"Hey come help me, you've been around this stuff before and can tell me what to do"

soon becoming

"No, I don't think that's necessary/I can't do that/I've got a special situation where that's not needed..."


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RE: To all the dreamers who want to start a nursery

"The reason why you are seeing those branded pots is because it is the norm, in today's retail nurseries, to buy your product from the wholesaler. Not many nurseries out there are able to grow their own product and sell it at a competitive price (some still exist, just not many)."

Which reinforces my point that these are volume products. The only thing you have that can be used to make yourself competative with that part of your stock is your price or maybe a certain amount, convenience & your location if you are lucky enough to have more traffic than your competition. All of your competition carries those plants and they buy them for the same price you do. If your stock is 100% those products you'll have a tough go at profitability.

You have to have value products in your mix, whether you grow it yourself or buy a subset of your stock from smaller wholesale growers. And you need something (product, service, or shopping experience) that you can label with your own store brand, otherwise you can't differentiate yourself to build a loyal customer base. Growing a portion of their own stock is one way many garden centers seem to do this. They can then brand these plants with all their own fancy labels that sell THEIR store name not some wholesaler, and they can use this to become known for this "specialty" which draws a loyal customer base. Others negotiate own store branding of plants from smaller wholesalers. Still others use a unique store experience- the garden cafe, etc.

"The pricing is not an attempt to gouge the customer, your business would fail quickly if that were the case (and I'm sorry you feel that way). The pricing is to stay competitive against other nurseries and make enough profit to keep the doors open for another year."

All capitalist endeavors are based on making profit at the expense of the consumer. I'm not saying it's bad or that it's gouging, just that as a consumer I will shop for better prices when ever I have the opportunity, so will most of the consumer base in a capitalist society. That's just the way it works. The flip side is I also shop for better value where there may be fewer competitors offering the same plants so I may pay a premium price. I'm the same customer and I buy both types of products. I may walk out with only the volume products on a particular visit just because you happened to have them and it was convenient to pick them up, but I really came into the store looking for a particular value product and maybe you didn't have it this time.

Back to my original question, how do you get the right value/volume/services mix?

It's different for every location because the demographics of the customer base are different in each place. Somehow successful businesses find a way to get their product mix in the sweet spot.

The other thing I see is a shift in the market channels. There are many successful growers of these niche value plants these days who are primarily mail-order shops with internet customer base. Why aren't these customers buying from a local garden center? Probably because the lgc isn't carrying the niche plants they are looking for. Yet lgc's are still trying to rely completely on the local customer base with no mail-order component at all. I think it's a missed opportunity for at least some lgc's. Others have enough steady business already that internet sales and mailorder would divert them from their core.


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RE: To all the dreamers who want to start a nursery

  • Posted by bboy z8 WA USA (My Page) on
    Fri, Jan 11, 08 at 12:05

Most operations here do not have all branded pots, in order to have a full selection plants must be bought from perhaps dozens of suppliers - many of them local and independent from syndicates. Those branded items that do appear are often, in fact, exclusive to that source, the only kind of plant available with that combination of characteristics. It's also true that on a national level there's lots of trademarking and even patenting by large operations of similar varieties, so much so that you have to wonder if everyone's version really is distinct from the others.


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RE: To all the dreamers who want to start a nursery

  • Posted by ian_wa Seattle area (My Page) on
    Sat, Jan 12, 08 at 1:35

Hi again.

>>I'm not convinced yet that retail can really stand alone w/o wholesale/growing/services in some degree.

Despite the trend of retail nurseries moving away from actually producing anything, I can think of a few nurseries that have developed a very successful business model growing a lot (even most) of their own stuff. Flower World in Maltby is one - they even propagate/produce a lot of their own large trees etc. On a much smaller scale, Sunny Farms in Sequim does the same sort of thing and remains very competitive by offering a different selection of plants from the other nurseries in the area. Some nurseries (Molbak's, Watson's) seem to find it worthwhile to select a few plants, or types of plants, they are good at mass producing for retail sales, and buy in the rest of their stock from other growers.

In one retail nursery I worked at, I asked why not do a little propagating to increase our selection and maintain better control over plant quality? The answer was, now is not a good time to get into propagation because of the increasing cost of fuel (i.e. to heat a greenhouse). That's a silly excuse though because the grower has to pay for it anyways and when they absorb that cost it is twice as difficult for them since they are only charging half as much for the plants as a retailer would. And then someone has to pay for fuel (and trucks, maintenance, whatever) to deliver the plants to the retailer. All of which could be avoided if more retailers explored plant production as a viable alternative to the status quo. I think most retailers are just afraid of the concept, or feel that they can't be bothered when they are so busy with everything else. I think it is a great idea for all the reasons above and because of the opportunity for better quality and inventory control. How many retailers can never keep this or that in stock (I think of Myrica californica) because the plant is in high demand and always sells out, even though it is very easy to propagate? For some retailers, space is certainly a limitation.

>>There are many successful growers of these niche value plants these days who are primarily mail-order shops with internet customer base. Why aren't these customers buying from a local garden center? Probably because the lgc isn't carrying the niche plants they are looking for.

I've noticed 'normal' independent retail garden centers/nurseries get mixed results with the unusual stuff. Part of it is presentation, I think. A lot of times I see something rare labeled 'frost tender plant' (as if warning the customer not to buy it) whether or not the item is really more tender than all the common Hebes, Cistus, Escallonia everyone is selling/planting, because the nursery staff simply haven't educated themselves about the plant. Part of it may be the accepted mentality among shoppers that if I want something normal that my neighbor has I will go to the garden center and if I want something unusual I will look on the internet or in a mail order catalog. This isn't always true, though, and some nurseries are pretty successful marketing rare stuff if they just mix it up with the common stuff rather than promoting it as 'rare' - the customer looking for something normal might be drawn to the plant and buy it without knowing the difference and the customer looking for something unusual will be clever enough to find the plant and figure out how special it is.

I hope that made some sense.... writing on very little sleep :P


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RE: To all the dreamers who want to start a nursery

  • Posted by laag z6CapeCod (My Page) on
    Sat, Jan 12, 08 at 9:01

I think that everyone seems to understand the concept of volume/lower pricing when selling. But, I think that the concept is often overlooked when it comes to production.A large national production nursery can produce at the fraction of the cost that a small nursery can. I believe that the amatuer grower initially only sees the costs of the seeds and other products that go into growing the plants.

Much like the person who harvests 50 lettuce heads out of their back yard feels like they got the lettuce more or less for a little effort and some seeds. But, think about the fact that you can buy the 50 heads for $50 at the grocer.

Then think about dividing the time spent preparing the bed, watering, maintaining, and harvesting by $50 and realize that is the rate of return you got for the time. Take that amount and the cost of hiring a laborer per hour and you can easily see that it does not translate to a viable commercial endeavor.

Does it make sense to translate that to a similar result when talking about producing plants?


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RE: To all the dreamers who want to start a nursery

  • Posted by ian_wa Seattle area (My Page) on
    Sat, Jan 12, 08 at 14:49

While that makes sense to a point, I think most small wholesale growers - who around here seem to be very popular among retailers and very successful - find that such a wide variety of plants can be grown under similar conditions (or two or three sets of conditions), that it isn't prohibitively labor intensive to produce a couple hundred to a couple thousand different kinds of plants. A retailer attempting this would compete well enough on selection, and might find that with some smart planning and up front investment in infrastructure, the real labor costs (basically just propagation, potting up, and anything else a normal retailer would be doing anyways (marketing etc) ) aren't really analogous to the backyard grower who is constantly hand watering and weeding his stuff.


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RE: To all the dreamers who want to start a nursery

Yes, of course the costs are lower for the major wholesaler. Profitability in a "volume" product market/manufacturing biz is all about maximizing efficiency. A)they have put a lot of money into equipment that reduces labor & increases their efficiency which they then ammoratize out over much larger crops B)they limit what they grow to those products that give the highest return when grown enmass so artificially kill the supply for some plants (thus limitting the consumer to what they want to sell) C)they use things like patents to increase the lifecycle of the product's highest price point- this is for the "highend" of the volume product lines.

I work for a major computer manufacturer- the strategy is identical in this industry. For volume markets (pc's and low-end servers) the manufacturing processes are all about the same efficiency, lowering costs and dependent on two major wholesalers who drive the industry the direction they want it to go. They and we manipulate the supply to the products we want to keep selling by end-of-lifing the older stuff to force consumers to upgrade. In the high-end servers, custom mega-computers...etc it's all about higher prices which are accepted by the customer as a needed to recoupe higher product development costs but in fact yield much higher margins. Then tack on customized support & services contracts, and high touch customer experience on the sales side. The high end market is smaller in terms of volume & number of customers but each individual customer is willing to pay much more. Different industry, same-o same-o.

Many of the plants that I'm seeing people successful with are field grown and not so very labor intensive as a greenhouse operation. They are sold fresh dug or bare root, sometimes but rarely potted. Most of these growers sell direct onsite retail, wholesale, and mailorder. In addition, some rent out their display gardens for weddings and events. The winter, typically dead time for the lgc, is the busiest season with internet & mailorder order/payments coming in for plants that will be shipped in early spring. The early spring is filled with preparing & shipping orders and lining out plants for the bloom season sales. Fall is harvesting & processing seeds from any hybridizing they have done- some seeds they may sell. If they are hybridizing, they may also be sowing seed in a small greenhouse operation during the winter- usually something they grow into over time.

Yes, they have the cost of land to ammoratize out, they have the cost of water, they have the cost of farm equipment & fuel, they have fertilizers, and certainly they have labor. They do not have heating or lighting expenses (unless they are using the small greenhouse). Many, though not all, do not use pots, packaging, or potting soil at all. They have weather and insect/disease related risks just the rest of the garden industry.

Examples: hosta, bearded iris, daylily, spring bulbs, roses, peony, siberian iris, lousiania iris, lillium, some specialty hardwoods/shrubs.

The old timers in these grower/mailorder/retail outfits rival the biggest lgc's annual revenue. There are masses of hobbiest who really are not trying seriously to make a business of it- few of those really last the test of time. There are masses of smaller startups, some will be satisfied with just enough income to get by, some won't have the business savvy to make much of it, a very few will one day fill the void of the retiring old timers.

The lgc's out here that I mentioned are looking for buyers for their retail units both plan to keep their wholesale growing & landscape services divisions...it's not rocket science to figure out why- that's the more profitable part of the business over retail. One is greenhouse growing specialty tender plants like poinsetta. The other is combination field/greenhouse growing hardwood trees, shrubs and perennials.

There must be something to this or there would not be so much revenue passing through this part of the industry.


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RE: To all the dreamers who want to start a nursery

The wholesalers are growing wide varieties of plants in our area. I think I can pick up a mail order catalogue and find just about every "specialty" plant for sale at many of our local nurseries (maybe it's just where I live). I've tried the mail order and generally have been very unhappy with the product. I'd much rather pay a bit extra and get a healthy, robust plant from a local nursery... any day! I think that people who are really drawn to the catalogs are in it for the cost. "Why pay $7.99 for a one gallon Delphinium when I can pay a mail order the same price for 3 dried up twigs that I have to rehydrate and nurse along?" And that is IMO, the mail order target market: The people who enjoy nurturing plants from the brink of death. And those people are not your target market at most nurseries. The people who tend to be incredible nurtures are the bargain bin shoppers. Not that there's anything wrong with that, but the nurturing bargain bin shoppers are not going to keep your doors open.

I think the reason less nurseries are growing their own stock is quite simply, acreage. Using some of the large retailers in my area as examples. Most are at least 5 acres. If they are growing on site, it's primarily annuals and hanging baskets in greenhouses that are 20,000 to 50,000 square feet. JUST FOR ANNUALS! They have trees, shrubs, and perennials shipped in from wholesalers. And this is the biggy... most, if not all of those retail nurseries own their land, cutting down on their overhead, because they've been in the same location for 20+ years. And, once upon a time those nurseries were considered to be "in the boonies" but sprawl has caught up to them and now they have fabulous urban locations!

The few tiny specialty nurseries that are left are often private properties that are "by appointment only" shopping. I'm in love with these kind of places and what they offer, but these people are either retirees or they have other jobs. Not a lucrative career in growing specialty plants.


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RE: Oops

Berrytea, I must have been posting at the same time you were. I'd be interested to hear how those "dig your own" type of nurseries are doing. I can't think of a single place like that out in my neck of the woods, but very intriguing.


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RE: To all the dreamers who want to start a nursery

"One is greenhouse growing specialty tender plants like poinsetta." Not true. There is precious little money in a poinsettia crop or a lily crop anymore and they are cranked out by the mega producers like cookies. Many of the mega producers sell them at a loss or very nearly so. They still produce them because it's using their bench space, and the expenses continue year round per square foot, so you might as well only lose a little money, than a lot by going fallow for a season.

The cost of producing your own stock ( and the reason so many operations aren't anymore, or buying it in pre-finished) is tied directly to the cost of energy and fuel. I have had to drastically, and I mean drastically change my production methods to continue to grow many of those heated tender crops. I've also had to drop less profitable outlets for their marketing. ergo, to keep the point of diminishing returns static, I've decreased my production of them by at least 50%....because I can only justify selling them at X dollars with less $ in the growing end, and drop the very early and very late "season extender" lines so that I do not have as many g'houses eating fuel, and minimise shrink to non-existance. I've also gone to some lines simply re-wholesaling and some lines as pre-finished, whereas I used to take the whole crops from start to finish myself.

I think this is a very important aspect of staying solvent and profitable in this industry. You have to really, really know your production costs and plot them against the returns. You cannot be all things to all people, and you need to define where your market with the highest return lays and not be sentimental about what isn't paying its way.


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RE: To all the dreamers who want to start a nursery

""One is greenhouse growing specialty tender plants like poinsetta." Not true. There is precious little money in a poinsettia crop"
I know, I was surprised to learn they were doing this too. They must have found a higher paying market for them- maybe interior landscaping? I don't know more details, just that they are keeping that part of the business but looking to sell the retail store. They are growing other crops as well though, again, I don't have all the details.

I dont' agree with the same comment about lily market, at least not daylily. The data I've seen is that there are perhaps 5 companies that are in the $10-20M annual revenue and literally hundreds below that. There are also quite a number in the $1-5M range. The majority are <$500k and it's hard to weed the hobbyists out of that data. These growers don't waste their time on the common fast increasers that the boxes carry or that the commercial landscapers use. They are offering large selection of varieties (200-800 cultivars available at most growers with >58k varieties registered to date) for collectors and hobbyists. New intros are in the $100-400 range per single fan. Then the prices drop year by year until they range from $20-$4 for 2 fans on older cultivars that are still highly collected.

Also, I agree that quality is a big concern and this limits the types of plants that are doing well. They tend to be sturdy plants that either go dormant or that are strong enough to tolerate digging, root cleaning, shipping well. There are state regulations on shipping that impact how they must be packaged and treated.

Similar situation with Iris and Hosta.

"I think this is a very important aspect of staying solvent and profitable in this industry. You have to really, really know your production costs and plot them against the returns. You cannot be all things to all people, and you need to define where your market with the highest return lays and not be sentimental about what isn't paying its way."

Absolutely, I could not agree more! And you are correct, owning land is a major factor. In fact it also is a major barrier to those companies who are trying to sell their business because their land value is so high that they have a huge asking price for the business and it's tough to find buyers in that high range for a business that isn't turning enough profit to cover huge property loans.

nwnatural, There are several Iris growers in my area which started me looking at this type of business. They aren't often "dig your own" as much as buyer walks the display bed and chooses what they want, then the owners or their workers dig the order from the increase beds. In the case of iris the order is usually held then dug & shipped in the fall once the plants have gone dormant. I've done a lot of internet research into what the companies are offering. I also use the ResearchUSA small business database available through my local library. That database allows you to search privately held companies by name, location, SIC codes and will give ballpark revenue along with some other details of the business. It's hard to tell how current the data is and there are many more companies in existence that have not made it into the database but it's a good place to get rough idea of a market and target business. I've added to that some interviews with insiders. Much more research to do before I would jump in though.


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RE: To all the dreamers who want to start a nursery

No, by lilies, I meant forced lilies sold as an ornamental, like Easter lilies. Something where the initial cost for the bulb is high and getting higher every year, where they must be heated to a relatively high temperature during January, February and March, and also be cooled before the forcing stage, sometimes lit, height controlled and is subject to various root rots and aphids. It's a very expensive and also very difficult crop to grow "well" and the window for sales is about one and a half weeks in a year.


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RE: To all the dreamers who want to start a nursery

ah! yes forced lilies makes sense. I could not imagine making profit like that. It has to be one of those give away items that you are lucky to sell at cost but hope that the customer coming in looking for that item walks out with 10 others that actually have margin.

Now, back to the field grown market. I have to wonder why the big mass-producing farms have not gotten into these niches. They market a few fast increasers to the general market but once a gardener figures out that daylilies come in more colors than orange and yellow, iris in more than purple, and hosta in more than blue-green they no longer settle for those.

I think it's that the time for the plants to increase/mature in the field is viewed as too long for their mass marketing. Field time would be viewed as risky & expensive, with increased opportunity for natural weather or disease related loss & lost opportunity for other crops that could be brought to market several times over in that same amount of time.

I have heard though that some are beginning to tissue culture. You'd still need pot or field time for each plant to mature but you would not be waiting for increase. It's a pricy process though. Will it really take off?

Still, experience from my present field tells me that those who are good at and entrenched in the volume market usually don't understand the value market well enough to get off the ground and visa v. It's rare to find someone who really excels at both, at least until you get into very senior levels of the company and, in a corporate world anyway, that level usually doesn't know how to execute to actually deliver anything. Small business owners have to wear many hats so I expect this is a corporate phenomena that might play in the small biz owners favor.


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RE: To all the dreamers who want to start a nursery

I was an owner/grower of a small speciality nursery for 18 years. Since closing my nursery in 2006 I now have the time to pursue my love of garden photography and garden writing. I started my blog and hope to share my experiences with others. You can click on the "about me" and see how I started my nursery.

Here is a link that might be useful: My Garden Travels


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RE: To all the dreamers who want to start a nursery

I have another book to recommend. I found it at my library and just started into it so if you've already read it and have comments, please share.

"Plants For Profit: Income Opportunities in Horticulture"
by Dr. Francis X. Jozwik copyright 2000

At least to begin with he seems to cover good business basics. Some of his facts do seem a little dated.

He acknowledges both those who want larger operations and those that want smaller ones. He also has a significant section for those who simply want employment in the industry, not to be entrepeneurs.


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RE: To all the dreamers who want to start a nursery

"I have heard though that some are beginning to tissue culture. You'd still need pot or field time for each plant to mature but you would not be waiting for increase. It's a pricy process though. Will it really take off?"

This has been SOP for much nursery stock in the industry for many years now, in fact decades, it's not new or unusual and is cost effective.


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