Survey Says: Realistic Statistics

June 15, 2006 - 11:07

To provide a current and detailed assessment
of the floriculture industry, GPN magazine
and OFA — an association of floriculture
professionals — teamed up to produce the
2006 GPN/OFA State of the Industry Survey. The survey
highlights grower demographics, revenue, purchasing
intent, industry issues and other marketrelated
topics. Its purpose is to bring growers
up-to-date information about their industry. From
the information, industry members can understand
more about their peers, possibilities for the future
and issues affecting the industry.

Some of that information is included below;
additional information will be presented during the
OFA Short Course (see sidebar, page 32) and in
quarterly articles in GPN. These highlights below
represent some of the statistics that may be most
interesting and helpful to you, the big grower.

Profiling The Average Grower

The average grower has been
with his or her current business for
roughly 11 years, with nearly half
remaining for 15 or more years.
The average age of respondents is
approximately 49 years, with most
respondents’ ages falling between
40 and 59 years. Most of those surveyed
(65 percent) classified themselves
as an owner and/or president
of a company. Others were
involved in production (18 percent)
or sales and office management
(7 percent).

Of the respondents, 76 percent
belong to a state or national trade
association. The results show
the likelihood of a grower being
a trade association member
increases with a business’s
gross sales: About 93 percent of
growers with gross sales of $5
million or more have an association
membership, and 51 percent
of growers with gross sales
less than $50,000 do.

The average grower’s company
has been in business for
roughly 32 years: Thirty-nine
percent of those businesses are
wholesale only, while 38 percent
are wholesale and retail.

Handling Merchandising Responsibilities

Nearly half of those surveyed (or their
agents) are responsible for merchandising
and/or care of the products they supply to
retail. Growers have mixed feelings about the
idea, with some viewing merchandising
responsibilities as an opportunity while others
see it as a burden.

On the survey, one grower indicated that
retail outlets should have to provide care and
another felt ill equipped to handle merchandising
because of a lack of training. Those who
feel merchandising responsibiltiy is an opportunity
mentioned that a grower can gain better
quality control of products and a more thorough
understanding of consumers’ needs.

Seventy-eight percent of growers with gross
sales of $5 million or more who are responsible
for merchandising and caring for their products
provide the services at the retail level themselves.
Twenty-two percent of them do not, which
indicates an increased use in services such as thirdparty
merchandisers who take care of merchandising
responsibilities on behalf of growers.

Average Gross Sales

A high number of large growers responded to
the survey, and that proportion carries over into
the average gross sales statistics. Our survey
shows that gross 2005 sales for respondents averaged
$4.8 million. Fifteen percent of those surveyed
had sales exceeding $10 million; 10 percent
had sales exceeding $25 million. Slightly more
than half had sales below $1 million.

Standardizing Container Size

The survey addressed the current
debate over standardizing container
size. At this time, the industry has no
container standards, and 40 percent of
survey respondents feel there is not a
need for them. The 60 percent of
respondents who do advocate consistent
container size point to more transparency
at the consumer level, easier
space planning and the ability to ship
into multiple regions. The majority of
respondents in all gross sales categories
would opt for standard sizing.

Marketing Initiative Interest

The idea of creating and supporting an industry-wide marketing initiative
is not a new one; it has floated around the industry for many
years. The survey was used to gauge grower interest in making another
attempt at bringing growers together for such an initiative.

Roughly one-third of growers, certainly a minority, would be willing
to financially contribute to the initiative. Additionally, 69 percent of
those who responded positively would be willing to contribute only 1
percent or less of their annual sales
to the cause, which shows that even
though some growers support the
idea, few would be willing to pay a
sizeable levy to see it come to
fruition.

Willingness to contribute did,
however, increase along with gross
sales. Twenty-two percent of those
who take in less than $50,000
responded positively to the idea,
while about 42 percent of larger
growers with gross sales of $5 million
or more accepted it. Size had
little influence over the amount
interested growers would be willing
to contribute. A clear majority
of all gross sales categories would
contribute 1 percent or less of their
annual sales.

Using Immigrant Labor

The survey reveals an industry trend most people
“knew” existed: Floriculture relies heavily on immigrant
labor. On average, immigrant laborers represent 23 percent
of the total workforce for those growers who
responded to our survey, and large growers are even more
likely to rely on immigrant labor. For responding growers
with sales of $5 million or more, immigrant labor is almost
half of their workforce.

Production And Size Breakdown

Overall, bedding plants were the
largest crop produced in 2005; they
made up an average of 32 percent of
all crops. This was followed by potted
crops (22 percent), herbaceous
perennials (14 percent), woodies/
nursery crops (10 percent) and vegetable
transplants (8 percent). Even
when the averages are broken down
by growers’ gross sales (see right),
this distribution of product remains
approximately the same. Most grosssales
categories follow the overall
average trend where bedding plants
are the most produced crops and
vegetable transplants the least. The
exception to this is vegetable transplants
for growers with gross sales
less than $50,000. For these growers, vegetable
transplants represent a larger portion of their production
than annual bedding plants and herbaceous
perennials.

About The Author

Meghan Boyer is associate editor of GPN. She can be
reached at mboyer@sgcmail.com or (847) 391-1013.

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