June 2002

B&C Greenhouses: Stayin’ Alive By Carrie Burns

Though the “B” in B&C Greenhouses hasretired, the “C”s are still there, but boy is it different from the5-acre piece of muck that Dean Cramer and his uncle, Pete Bloemsma (the B and Cin B&C), began back in 1965.

Dean caught on to the idea of growing from hisfather-in-law. “He had a little truck and was going to Chicago with itand peddling flowers. I was distributing bread at the time, and I thoughtflowers would be a lot more fun,” Dean says. “So, we decided to buildsome greenhouses and get started.” Growing only about 10,000 flats ofannuals each year, B&C started with 6-8 employees. Now, about 30 employeesproduce over 200,000 flats just eight miles away from the original 5-acrelocation, in the southwestern Michigan city of Kalamazoo. There is anestablished, 48-acre tract on high ground with a family of growers that canovercome the industry’s highest hurdles.

Establishing a Lasting Relationship

B&C began a relationship with Kmart in 1968, back whenthe 606 jumbo flats were wooden and as big as 10 1/2 inches wide. Though theflat configuration has changed, B&C is still shipping bedding plants— petunias, marigolds, impatiens, begonias, etc. — to Kmart. Thirtyyears after the first shipment, Kmart had become B&C’s largestcustomer, receiving approximately 75 percent of B&C’s business.

“Kmart has been a good partner over the years,”said Darren. “They have been a big part of our growth because they havealways sent us consistently big orders. The container size and the plantvarieties have fluctuated over the years, but that’s to be expected. Whatwe didn’t expect was for their prices to start dropping, and no one wouldhave guessed 20 years ago that they would be in financial trouble.”

Though the retail giant might have topped the category 20-30years ago, they’ve been on a downward slide for a while, and the Cramershad been hearing hints of Kmart’s impending bankruptcy for some timebefore they decided there was no other choice but to take action.

Traditional supplier/vendor theory argues that no suppliershould have more than 15-25 percent of their business with one vendor, but asthe mass merchandisers have grown, it has been far too tempting for growers toresist growing with them, causing many growers, like B&C, to be dependenton a single vendor. Now, with bankruptcy looming for his largest customer, TheCramers began to think of ways to protect their business. Diversificationseemed the logical solution.

Existing Resources

When they started the search for alternative revenue streams,B&C was lucky to have an existing resource to draw on: Country ViewShowplace, a small, seasonal retail area they had opened in 1995.

As a result of the Kmart announcement, B&C decided todevote additional resources to their fairly new retail venture. Over the pastyear, Country View Showplace has doubled in size to about 21,000 square feetand now offers a full range of hard goods, including fertilizers, gardenaccents, arbors and soil, as well as a variety of home-grown annuals andperennials.

The biggest hurdle with the retail business has beenbuilding a customer base. Located on existing greenhouse property that wasselected for its remoteness, the garden center gets little walk-in traffic.

Dean and Darren are in the process of making some initialadvertising efforts, but marketing Country View has been a little difficult,and most customers are directed to the garden center by word of mouth.”We have high-quality plants at low prices,” Darren explains.”We try to keep in line with what the chain stores are doing and providea better product than they do at a similar price. I feel that if the people canfind us, then they will keep coming back.” They have been working withdifferent marketing plans and are considering a billboard campaign in additionto the ads they run in the local newspaper and the little league baseball teamthey sponsor.

Country View has allowed B&C to grow a variety of cropsand get a taste of what the consumer really wants. “It helps us changeour business — to realize that we exist for the customers, to providewhat they want,” Dean says. “For retail, we grow so many things:perennials, herbs, a lot more things than what the chain stores handle. Peoplewant variety, and they want education. When they come out here, we have a lotof things that they never see at the chain store. We give them somethingspecial, and they come back.” For example, Country View carries a 12-inchsuperbasket that is a great seller, but the larger chains don’t requestit.

New Territory

Encouraged by the success of their garden center, B&CGreenhouses has started experimenting with even more alternative revenuestreams, most notably, perennial forcing. Though they are new to the forcingbusiness, B&C has worked out a system that uses temperature, light andwater to break dormancy prematurely, bringing plants into bloom as much as fourmonths early.

“The first step is to break dormancy,” Darrenexplains. “To do that, we keep plants at 44° F for 9-12 weeks. Afterplants start growing, we bring them into early flower by regulating wateruptake but more importantly with night lighting. We found that a 4-hour nightinterruption works best for most of the varieties we grow.”

Starting in early February and continuing through mid-April,one-third of each variety to be forced is rotated through the forcing area eachmonth. Favorite B&C varieties include hostas, cannas and delphiniums.

Nearing the end of their first forcing season, Darren isexcited about the potential perennial forcing holds for the company. For now,all forced perennials are channeled into their own retail at Country View, butthe possibility of expansion is always there.

“Even though it is too early to tell what effect theperennial forcing will have on our bottom line, we are very excited aboutit,” Darren says. “At the very least, we will be able to give ourretail a larger variety, which will make our customers happy and again, helpset us apart. Plus, there is always the possibility that we could expand toother retailers. Perennials are pretty big right now, so we think this will bea good growth market. We see lots of potential.”

A few words of advice

Being in business for more than 30 years, you see a fairshare of change. For the first time, though, these changes are threatening thecompany’s success, and instead of simply weathering the changes, B&Cis having to do the changing.

“We’ve seen major changes in the industry. Wewent from a wooden flat to a plastic one and from 100-percentcell-pack-produced bedding plants to herbs and perennials and more containersizes than you can count,” Dean acknowledges. “All that shows isthat you’ve got to be aware of what your customers want — not theretail customer but the end consumer — and be ready to implement that.You’ve got to be ready for whatever the market throws at you because ifyou’re not, it’s tough to play catch up.”