A Case For An Integrated Horticulture Industry

As a self-purported “industry outsider,” I am always amazed at the divisions in the lawn and garden industry. Consumers often view the industry as one industry, and they typically like to buy plants and the materials they need for these plants in one retail visit. As we know, there are a number of current debates over the interdependencies of retail, landscape and growing operations.

Recent research conducted by the American Nursery & Landscape Association suggests that more integration in the industry (particularly among retailers and landscape firms) will better meet the end consumer’s expectations.

This integrated approach in the industry may also be an effective way for retailers and landscape firms to further differentiate themselves in the marketplace and to combat the growing competition for consumer dollars.

Consider the computer industry as a case study. The computer is the epitome of a commodity product. The components are so reliable that consumers care less about who manufactured the product. Brand equity and trust has shifted from the manufacturer to the retailer. Consumers typically base purchase decisions on desired features and price. Early in the computer industry, IBM was the leading manufacturer. Over time, IBM could not compete with cheaper imports or more nimble suppliers. About 15 years ago, IBM made a strategic decision to focus on higher-margin consulting services and complex systems design. This decision paid off. Today, IBM owns the corporate computing market – they sell few actual computers, but their clients pay top dollar to link them together.

The same phenomenon is impacting the gardening market as the level of competition increases. Is it time that retailers and landscape firms work together to go after higher-margin services for the home? Recent surveys of homeowners conducted by ANLA certainly suggests that this strategy has merit.

The author is Home Improvement Practices Director for P.K. Data Inc. This article was originally printed in ANLA’s Consumer Insights publication.