L&L SURVEY
Nursery Survey Shows Internet Sales Potential
CLEVELAND – The world of e-commerce has clearly altered the nature of retail shopping at a dramatic pace with the growth of web sites like amazon.com and priceline.com. Can the same transformation take place regarding the sale of nursery material and supplies to landscape contractors?
A Lawn & Landscape survey of nearly 300 contractors found that 53.4 percent of them are either "interested" or "very interested" in the idea of ordering plant material over the Internet.
Other points of interest from the survey:
• Almost half of the respondents (47.3 percent) purchase plant supplies from three to six suppliers.
• Slightly more than 63 percent of contractors purchase additional products from plant suppliers, with pesticides, hardscape materials, irrigation supplies and lighting supplies topping the list.
• Widely reported issues about the lack of plant availability don’t seem to be upsetting contractors, as respondents rated the difficulty of purchasing materials a 5.7 (1-10 scale with 10 being the least difficult) this year.
Top Ten Growing Counties
County: Percent Growth
1. Nye, Nev.: 100 percent
2. Forsyth, Ga.: 93 percent
3. Elbert, Colo.: 89 percent
4. Dawson, Ga.: 88 percent
5. Henry, Ga.: 87 percent
6. Douglas, Colo.: 87 percent
7. Paulding, Ga.: 85 percent
8. Loudoun, Va.: 83 percent
9. Williamson, Texas: 83 percent
10. Collin, Texas: 82 percent
Lawn and landscape contractors obviously like operating their businesses in areas that are growing, as more people equal more customers. Examining the list above of the fast growing counties in 1998 explains why Georgia has been such a hotbed of acquisitions, as four of the country’s 10 fastest growing counties can be found there. Contractors in certain parts of Texas and Colorado should also be enjoying considerable growth.
MERGERS & ACQUISITIONS
McGinnis Merges with Jenco Industries
ALPHARETTA, GA – McGinniss Farms, one of the largest distributors of nursery materials and other horticulture-related products in the Southeast, expanded its market by merging with Jenco Wholesale Nurseries, Carrollton, Texas, one of the largest nursery suppliers in the South and Southwest.
Combining Jenco’s 10 locations in Texas, Oklahoma, Kansas and Mississippi with McGinniss’ 19 locations in Georgia, Alabama, Tennessee, South Carolina and North Carolina creates a one-stop horticultural shop for contractors that has plans for continued growth.
"We want to be a national player in this industry, and the continued consolidation of nursery growers and irrigation distributors has created opportunities for us in both markets," explained Stan Walker, founder of McGinniss Farms in 1987 and president and CEO of the new, merged company. "There isn’t any one company dominating in what we do in markets all across the country, although we certainly do have some competitors out there.
"Now, we feel as though we’re the dominant player in two significant geographic markets – the Southeast and the Southwest," Walker noted. "But there are still many other opportunities for us in terms of additional acquisitions or raw start-ups of new locations."
Walker explained that the merger, combined with some outside financing, provides the new organization with additional capital to finance additional growth.
Walker was also quick to point out, however, that he believes this deal will position the combined entity to better serve the landscape contracting industry, which currently represents about 95 percent of its business.
"This deal means that our plant procurement power will get better, which will translate to better prices, and we’ll also be able to offer better service and more convenient locations for our customers," he explained. "For example, we’ve computerized everything in our stores, and time is money to the landscape contractor. So, if they can get in, place an order and get out of the store quicker, that’s better for them.
"We’re also in a stronger position with growers to command better quality plants and contract growing," Walker continued.
Walker predicted continued consolidation for the nursery and distribution industries in the not-to-distant future.
"I think the 80/20 rule will apply with 80 percent of nursery product coming from 20 percent of the players," he forecasted. "There aren’t too many people in this industry who can afford to write the big checks, so we’re becoming dependent on the investment community that hasn’t looked at this industry a lot and doesn’t understand the issues we deal with, like perishability of plants. Now, we’re starting to get some of this attention, however, and outside investors are seeing that this industry includes more than just mom-and-pop garden centers."
IN THE NEWS
FFA, Industry Team Up
INDIANAPOLIS, IND. – "I believe there will be more specialized courses of study and more internships." That’s how one contractors replied when asked how he expects the recruiting process for lawn and landscape employees to be different in 10 years.
Well, that contractor and others should be pleased to know that the development of the first-ever national green industry curriculum for as many as 450,000 high school students has begun through a partnership between the National FFA Foundation and several prominent green industry firms.
A total of $282,000 has been raised, largely through donations from The Toro Company Foundation, The Scotts Co., Zeneca Professional Products, the Northwest Turfgrass Association and the United States Golf Association Foundation, to fund the curriculum development.
"We are trying to create increased visibility for the myriad careers in the green industry by developing this curriculum," explained Bill Hoopes, director, training and development, Scotts Lawn Service, Marysville, Ohio.
Jana Jaure, regional director for the FFA, explained that the curriculum will be written during the next 12 to 15 months. After that, at least one high school teacher from each of the 50 states will take part in a "Train the Trainer" program so they understand the curriculum and how to best teach it.
Hoopes said the curriculum steering committee hopes to have the curriculum available in high schools for the 2001-2002 school year, with the potential for ultimately offering the classes in more than 7,500 schools nationwide.
"Students will take classes that cover the basic science education they need for the lawn care, landscape or golf industries, and then they’ll split off into functional courses for their area of focus," Hoopes added.
"The green industry wanted to find a recruiting avenue to deal with the labor shortage, and this curriculum will promote the industry as a whole," explained Jaure.
IN THE NEWS
TruGreen Changes Interior Name
MEMPHIS, TENN. – TruGreen-ChemLawn announced it changed the name of its interior division from TruGreen-ChemLawn Plantscaping to TruGreen Interior PlantCare. The change was made to differentiate the interiorscape service from the company’s chemical lawn care service. The company has interiorscape operations in more than 50 cities across the country.
MERGERS & ACQUISITIONS
Case, New Holland Finalize Merger
CHICAGO, ILL. – Case Corp. and New Holland announced the merger of the companies into CNH Global N.V, Racine, Wisc. The estimated combined 1998 revenues of Case and New Holland are about $12 billion, said CNH President and CEO Steven Lamb. "We are extremely excited about the opportunity in front of us," Lamb said.
Part of CNH’s strategy will include incorporating the global balance and strength of the companies and emphasizing product differentiation between the Case and New Holland products. Case and New Holland equipment will retain the brand names and be known as a product line of CNH, Lamb said. There is geographic recognition of the brand names of Case and New Holland and CNH wants to keep the market strengths those names carry, he added.
Part of that product commonality will include a move toward making parts for similar Case and New Holland product lines interchangeable to give the company more leverage when it comes to purchasing materials and to keep costs down for the buyer.
IN THE NEWS
GIE Show Strong and Will Expand
BALTIMORE, MD. – The Green Industry Expo continued its growth as almost 6,000 attendees visited the nearly 300 exhibitors and sampled from more than 50 educational events. The GIE Show is produced by the Associated Landscape Contractors of America, the Professional Lawn Care Association of America and the Professional Grounds Management Society.
Next year's show, to be held Nov. 4-7 in Indianapolis, Ind., will feature a new element as will hold its Interior Landscape Conference in conjunction with the GIE for the first time.
ALCA attributed shifting the show from its current January dates that coincide with the Tropical Plant Industry Exhibition to the increasing diversification the association is seeing in its members’ services.
Nearly 30 percent of ALCA members offer interior services, and ALCA expects this number to grow.
"Clearly, members are meeting the client requirements for one-stop shopping," observed Chris Raimondi, chairman of the ALCA Interior Landscape Council and president of Raimondi Horticultural Group, Ridgewood, N.J. "Next year’s GIE will provide interior and exterior members valuable information on this growing trend."
Some interior contractors are concerned that moving their show to November creates challenges in the midst of holiday decorating season, and ALCA said the GIE is exploring moving show dates to October following next year’s show.
Explore the January 2000 Issue
Check out more from this issue and find your next story to read.