SO YOU WANT TO START A NURSERY
Over the past twenty years I have had many discussions with individuals who were thinking about starting a nursery. A tour of our greenhouse and gardens filled with many different plants was intriguing and looked like fun. After all, Coenosium Gardens was a hobby that got out of control.
The very first question to consider is why enter the nursery business in the first place. Sometimes a person chooses the nursery business as a career from the start while for others it is a career change at a later point in life. Those who have always wanted to be involved in nursery work either discovered plants to be enjoyable things to work with and were not out for large financial rewards or they were brought up in a nursery family and naturally moved into the family business.
Those who enter the nursery business as a career change do so for a variety of reasons: dissatisfaction with a present career, the loss of a job, the need to do something less stressful, or retirement from another career. Whatever the reason for changing, financial improvement is seldom a primary consideration. After all, the nursery business is a form of farming and few farmers amass much wealth.
It is very important to decide if the nursery business is to be a sideline or a full time business, providing income for your livelihood. This choice will determine the answers to many questions about your market and the product you choose to grow.
One interesting facet about the nursery business is the friendliness of the people involved. There are very few trades or businesses where a person who is starting out can obtain advice and assistance from people with whom he will one day be competing. The nursery business is such a field, within limits. For example, I've had people visit and ask us how to do many specific things related to plant propagation and then ask for free scion wood- all to start a propagation nursery. They didn't understand why I said no.
Most nurserymen are more than willing to lend a helping hand to the novice, provided, of course, that the novice is making a substantial effort on his own behalf. But no nurseryman will allow himself to be taken advantage of.
The first decision most people make when entering the nursery business is actually a decision that should be one of the last to be made. They base a decision about what to grow upon what they like, not necessarily upon what they can sell.
For example, a person enjoys growing fruit trees in a home orchard and has even grafted different varieties onto some of his trees. So he invests in a piece of ground and lines out a number of young fruit trees, figuring that when they become large enough he will sell them and make money.
This same story can apply to just about any facet of the nursery business. Take the person who completes an extension course and through discussions with his classmates and instructor decides what he wants to grow. Unfortunately, just like the orchardist, he has put the cart before the horse.
Unless a person takes a very systematic approach to entering the nursery business, the results can be disastrous. A neglected field of poorly grown stock being choked out by weeds or a field of beautifully grown, but unsold, stock can easily result.
A number of decisions have to be made by the aspiring nurseryman. They don't necessarily have to be made in the order presented, but they do have to be made.
A person should decide if he is going to have a wholesale or retail operation. There are basic differences between the two. The wholesale nurseryman must grow a large number of plants of only a few varieties while dealing with a relatively small number of customers. He will be able to concentrate more completely upon growing and working with the plants.
The retail nurseryman handles a smaller number of plants of a wide variety and deals with a much larger customer base than the wholesaler. He must be more of a marketing expert and know the growth requirements and landscape uses of a substantial number of plants.
If a person enjoys working with many different people on a daily basis and a wide variety of plant material, then the retail plant business should be considered. If he doesn't like to spend a lot of time selling his plants and wants to concentrate on the farming aspects of the nursery business, then he should be a wholesale grower.
A newcomer to the nursery business must choose one or the other. Trying to do both retail and wholesale will usually mean that neither is done very well. There is too much dilution of effort. An experienced nurseryman can consider combining both retailing and wholesaling into one operation, but he must be careful. A wholesaler does not want to compete with his own local customers by opening a retail area. Likewise, a retailer who opens a wholesale department will find many of his retail customers expecting to make wholesale priced purchases.
Once the retail/wholesale decision is made then marketing must be studied.
A course on marketing at a local community college can be a good investment for the new nurseryman, especially since marketing involves a number of parameters. Where are the customers located? The plants must be suited to their tastes and growing conditions. Where are the competitors? A retailer must be most concerned about local competition while a wholesaler must deal with local and distant competition. What kinds of plant material are lacking in your marketplace? Are any of these things that you would like to grow? How can a market be created for some of the items that you want to grow?
The decisions up to this point should have provided some direction about how to sell what is to be grown. Now it is time to make some specific determinations about the crops. The wholesaler may do some brokering, but he will grow the majority of what he sells. He must grow large quantities of a relatively few items. He must be a successful farmer as well as an astute businessman.
The retailer, on the other hand, will purchase much of what he sells, growing a much smaller percentage of his crop than the wholesaler. He must work with relatively small quantities of many different varieties. But even so, some growing is very beneficial since some costs can be reduced and, with a good plan, the retailer won't have to worry about shortages of choicer material.
Marketing studies will help both the retailer and the wholesaler decide what material to offer for sale. But the wholesaler should take things at least one step further. Attending a local trade show will provide much good information. Obtain catalogs from as many distributors as possible and find out what they are growing. Look for common items. Those are things that must sell well. Talk to the growers and find out what they have sold out of. Talk to other buyers and get a feel for the kind of things they want to purchase. Having open eyes and studying what others are growing will be a big help in determining what to grow. But most of what you grow may be based upon other criteria- sometimes nothing more than "gut instinct."
Don't just go to a nursery in your area and ask them what you should grow. And especially don't ask a future competitor for his own special methods of producing saleable plants.
If a person decides to be a grower, either as a wholesaler or as a retailer producing part of his own merchandise, he must obtain liners. Liners are the young, immature plants that will be grown into a saleable product.
Liners must either be purchased from a propagation nursery or propagated in-house. Unless you are willing and able to expend considerable capital in obtaining stock plants and constructing propagation facilities, purchasing is a much wiser choice. When you have so many other things to learn, learning the art of propagation could lead to a dilution of your efforts. And in many cases, in-house propagation is actually not as cost effective as purchasing liners for growing-on. The propagation nursery will also be willing to help you make some decisions about items to grow but only if you can ask about specific plants. Even then, since a propagation nursery is not a grower, there is some guesswork involved.
If the prospective nurseryman decides upon retail, he must determine what market niche he wants to occupy. For example, do not try to specialize in one gallon junipers and azaleas in an area where chain stores sell the same or similar items. Consumers shop price for those items, and the small nursery just can't compete with chain store buying power. The smaller retailer must offer service and a product line unavailable at the chain stores. But do not ignore the chain store material completely. Carry some of these items to complement your main line.
Likewise, the small wholesaler shouldn't try to specialize in commodity items (fast-growing, gallon material) since the big, commodity producers can make a profit even selling this material cheaper than the small grower can raise it. Besides, commodity items are easy to produce and raise, leading to cyclic gluts and price wars between the big producers.
With smaller yards and a more plant oriented public, homeowners are becoming more discriminating about their landscapes. There are many small retail nurseries that do quite well specializing in dwarf conifers, trees, and shrubs. But the retailer must be well versed in his product to have good sales. Even a willingness to install small garden landscapes may be necessary in some parts of the country.
Bonsai has also become quite popular throughout the country, and some nurseries specialize in bonsai material. But once again, the retailer must be knowledgeable about the subject and even be willing to arrange classes for his customers. A finished bonsai must command a high price to compensate for the labor involved in producing it, often making it a difficult item to market.
One major problem faced by all nurserymen at one time or another is how to handle unsold stock. Since plants are living, growing things, they constantly need more space. When plants are not sold within an allotted period, they must be moved out of the sales cycle or they clog the entire system. Be prepared to burn or discard a number of plants almost every year after you enter your selling cycles.
Having special sales doesn't always work. Customers become trained and will often wait for these special times to buy material, especially if end-of-the-year sales become a common feature. Work with a few re-wholesalers who will take plants that have outgrown your marketing scheme and recoup some income. Or simply destroy the plants. Taking a smaller loss now is preferable to a bigger, long-term loss by being forced to use frequent sales to move material.
The biggest difficulty for the nurseryman is debt. Avoid it by all means. Sometimes debt is necessary to get through an occasional bad period in the economy, but borrowed money must be repaid. If a nursery is servicing a large debt, that debt becomes a sponge, soaking up a considerable portion of the tight profit margin under which all nurseries operate.
When starting a nursery, scale it to fit your expertise and your budget being careful that the two balance each other.
If you want to start a nursery, do your homework first. Growing and selling plants can be an enjoyable and very satisfying experience. Although it is seldom rewarding in a big financial way, it is rewarding in ways that can't be found on a spreadsheet. These other rewards should be the ones that make you want to be a nurseryman.
Counter Started March 31, 2002