October 2007 Big Grower

Firing on All Cylinders By Darhiana Mateo

Whether Richard Wilson is zooming down a racetrack at 140-plus miles per hour or sitting behind his desk at the Colorama Nursery headquarters in Azusa, Calif., this big grower — who indulges his passion for car racing when he's not running a thriving growing operation — is "absolutely" focused. He has to be. "It's real easy to get off that center path," Wilson says. "You have to be on it."

Colorama's president/CEO said it wasn't easy growing the company from a one-acre operation in Glendora, Calif., in the mid-1980s to a bustling 110 acres sprawling three locations — Azusa, Carpinteria and Thermal — renowned for its product variety and quality. It demanded a willingness to "put in horrendous hours," a keen eye for profits and opportunities and "constant vigilance," Wilson says. "On a daily, hourly, by-minute basis."

In this fast-paced and fast-changing business, and in California's uniquely competitive market in particular, staying afloat means ensuring that your product stands out from all the other guys'. "Everyone's pulled up to the line. There has to be a difference. It just can't be price." And for Colorama, which produces its own plugs and sells everything from herbs and perennials to succulents and cacti, to big boxes such as Home Depot, Wal-Mart, and Lowe's (and a few independents), that difference can be summed up in one word: Quality. "[It's] our backbone," Wilson says.

Planting the Seeds

Wilson started Colorama Nursery in 1984 in Glendora, Calif., after dissolving an earlier partnership with a former classmate propagating ornamentals. Even then, the astute businessman followed a principle that has helped his business flourish to this day: really listen to your customers. After talking with various buyers representing different fields about their needs, they kept asking for 4-inch color. "I'm not stupid. I started raising 4-inch color. From that point, Colorama was born." He sold his first flat that year, delivered 25 miles away. And it "mushroomed from there."

In 1987, Wilson moved the already-growing operation to 26 acres available in nearby Azusa and got to work looking into other markets. While the company started off serving independents, Colorama quickly hooked up with Home Depot: "Their needs were fairly significant. Took us to the next echelon."

New Markets

The Azusa location, originally Colorama's only site, consists mostly of production of perennials and annuals that tolerate the climate swings of Southern California, such as pansies, violas, petunias, snaps and dianthus. The site also has 10 acres of covered space, including 120,000 sq.ft. of saw-toothed design, retractable-roof greenhouses, 35,000 sq.ft. of arch houses, 30,000 sq.ft. of shade houses and 30,000 sq.ft. of outdoor cold frames. It also serves as the hub for producing plugs. In the early '90s, business was good and space was already running tight. When Home Depot approached Wilson with an order for 300,000 poinsettias, he knew there was no space to grow that amount, but he took the challenge anyway, showing a willingness to recognize opportunities in obstacles that he continues to employ more than 20 years later.

Wilson turned to his old classmate and partner and asked him for help finding a space big enough to grow thousands of poinsettias. In 1996, Wilson purchased an 18-acre production facility (formerly Sandy Land) in Carpinteria, Calif., "right on the coast highway," for covered production, growing ocean-loving crops such as begonia, gerbera, cyclamen, calla, impatiens, mini-roses and geraniums. Fast-forward a few years later, and Wilson began to notice that his growing operation kept shipping to Palm Springs from the Azusa location, a long, fuel-guzzling truck drive. About seven years ago, he purchased 60 acres of land in Thermal, Calif. Since Thermal warms up earlier than other parts of California, these greenhouses are often among the first in the market with blooming marigolds, petunias, vincas and other spring heat-loving plants.

This third venture did not go quite as smoothly as its two predecessors, but it led to an exciting new direction for the company. After terminating an initial relationship with the booming resort market in Thermal because of financial disagreements, Colorama decided to try something completely new for the company: growing grafted citrus. "It's a dramatic change in paceÉtotally different thing than we're used to," Wilson says.

The three different locations, now employing a combined 250 employees, have increased the company's reach from the local market to the roughly 350-mile stretch from the Mexican border to Paso Robles on California's Central Coast. And because each market offers unique growing conditions, they can ask themselves, "What crop really loves it here?" and custom-tailor their operations to specific climates, resulting in an impressively wide product line and a competitive edge over other big growers in the area.

The More the Merrier

Big boxes looking for high-quality and ample choices know that Colorama won't disappoint. "The bottom line is we have to maintain our quality," Wilson says. And whether the product is succulents, vines, vegetables, cacti or perennials, they come with the nod of approval of an ever-vigilant team, from Wilson down to the truck drivers, "the last pair of eyes" who are authorized to hold onto any "funky-looking" product that might have slipped through the cracks. Financially, variety simply makes sense. Wilson's goal was to get "as much business out of our existing customers as we can; that we can grow," he says.

Besides its different crops, Colorama also gives customers plenty of options in how they buy the product, from 4-inch pots to color packs to 1-gal. containers to baskets and the now "in-vogue" combination planters, and caches that appeal to an increasingly "do-it-for-me" consumer base. Wilson says he sees potential in ready-to-use containers and plans to increase this offering in the future.

But just as Wilson is open to new opportunities, he recognizes that some things don't work out and that costs have to be cut. Wilson asks himself whether customers will be willing to pay for certain things, and in cases like fancy labels and matching color pots, the answer is no. "I'm real keen on money," he says. "We have to be making money, or it won't work."

Embracing the P-Word

In a time of shrinking margins and mounting demands on vendors, such as rebates and the introduction of pay by scan, Wilson remains unapologetically focused on the bottom line. "Profit is not a dirty word," he says.

First and foremost, Wilson is a businessman. As such, he knows that a business can't function without turning a profit. It's perhaps this close attention to margins, and the demand that every dollar be accounted for, that has allowed Colorama to survive amid heavy state regulations and heightened competition that have brought down other competitors through the years.

"When I first started, I had to be very aggressive — willing to risk more. I just put my nose down and kept going," he says. "Now, I look more at protecting ourselves. I really pay attention to profits and costs. I'm real keen on this. Am I too protective? Maybe so." But it's a strategy that seems to be paying off.

Wilson emphasizes the importance of interdependence among the whole team. Everyone has an important role to play in the day-to-day operation of Colorama, and they are all working toward the same goal. "Trustable people who know what working hard means" are vital to the success of any business, he says.

Managing Pay by Scan

Two years after beginning to use pay by scan, the company is still trying to "get its arms around it," he says. They do this by keeping an eye on the larger profit picture and an even closer eye on the every day details. "You have to watch everything. We'll do whatever our customers need us to do, but we can't be losing money," Wilson says.

The sales reps and merchandisers are instructed to keep careful track of the product — and dollars — and to help Wilson account for any mis-scans, thefts and throwaways that could add up to significant profit losses down the line. It's their jobs to keep the product looking good and moving off the shelves, while taking inventory of any "missing percentages." While it's a manageable number now, Wilson says he wants to make sure it stays manageable. With pay by scan placing a lot more risk on the growers, it's vital that they find "the inherent pit holes in the whole system," he advises.

Securing the Future

As Wilson looks to the future of Colorama, he says he is willing to change with the times and help lead the company toward a more secure tomorrow. This mindset demands a proactive approach. "Any time you have to be reactive, you're just being a fire captain. We're trying to be proactive."

One way they are working toward this goal is through embracing sustainability. The mantra of sustainability is not exactly new to the California-based Colorama, a state widely recognized as a trailblazer in this effort. Wilson defines sustainability as "thinking beyond our own time, own life." And the company does this in many ways, both small and large. Whether it's recycling soil, recycling plastics, paying drivers to pick up discarded flats, limiting the amount of fuel the delivery trucks use, installing a water recycling system that conserves 70 percent of the rainwater runoff or the announcement that Colorama will begin growing in biodegradable pots this year and is considering organic pesticides, the company recognizes the vital role that the green industry can and should play in conserving the planet's resources. Besides its intrinsic value, it also has economic benefits as the children of baby boomers, with their largely environmentally friendly mindset, emerge as the new, sought-after consumer base.

Colorama is currently fine-tuning some flood benches installed last month, which will cut down on human labor and help yield uniform, healthy crops, he adds. It's a costly move, but one he thinks will pay off in the long run. "Automation does help you get to places much faster. I'm all for it, but it comes with a very large price tag."

Staying the Course

Whether behind the wheel of a race car or making business decisions, Wilson says he doesn't waver from the center path. Win or lose, gain bragging rights or get a taste of humility, it's all about pushing forward and hanging on for one hell of a ride. Colorama is currently considering expanding — "if the right opportunity presents itself, so that we're not doing the same thing," he adds. "We'd rather go in a different direction." For Wilson, it appears that the winning business formula includes a sense of caution and a dash of fearlessness. And, perhaps, openness to the unpredictability of the future. "It's finding that crystal ball. What am I going to have to do in the future to stay in business? That's our constant quest every day."

SIDEBAR

Colorama Nursery At A Glance

Owner: Richard Wilson

Location: Azusa, Carpinteria and Thermal, Calif.

Size: Roughly 110 acres sprawled across three sites

Employees: 250 employees in three locations

Sales Area: Mexican border to Paso Robles area in central California (about 350 miles)

Biggest Customers: Home Depot, Orchard Supply Hardware, Wal-Mart, Lowe's, independent garden centers, smaller chain stores, landscapers

Lessons Learned

After surviving — and thriving — for more than two decades, Richard Wilson has learned a few lessons worth sharing:

Don't grow what you like. It's important to listen to your customers and tap into the changing demands and needs of the market. Keep an eye on emerging trends and other opportunities.

Profit is essential. A business can't function without turning a profit. Pay close attention to the numbers, and adjust your business plan accordingly.

Know your customers. Ask questions. Spark dialogues. Only by understanding your customers' desires, whims and needs can you serve them.

Management is key for success and longevity. Surrounding yourself with a strong team of hard-working, reliable people is a prerequisite for a profitable business — and your own sanity!