Diversify to do more than just get by

As we enter into this new year and are once again given the opportunity for a fresh start and a prosperous season, it is the perfect time to take a look at the garden center industry from a different perspective. Over the past few months, I’ve been speaking with members of the garden center industry all over the world to learn more about their successes, challenges and future outlook. What I found was that there’s a lot we could learn from each other. In this world of continuous globalization, the international garden center community seems to be facing many similar situations, whether they’re growing something called a plant, planta, Pflanze or huì.

One of the concepts that appeared over and over again was the idea of diversifying the garden center product line and services to remain relevant in a world of people with many interests competing for their attention, including offering full meals in cafes. I also heard whispers of customers “showrooming” — visiting the store to see the product in person and then purchasing it less expensively online — and the rising popularity of backyard chickens (see Leslie Halleck’s article on page 28 for more about this trend in the U.S.) and beekeeping.

This month, we bring you insights from garden center industry professionals in the United Kingdom, Australia, Canada and Portugal. Look for more perspectives from Europe and Asia in upcoming issues.
 

The tides are slowly turning in the United Kingdom

By Kevin Waters

Following a couple of years of pretty dismal trading, garden centres in the United Kingdom are currently enjoying higher sales and a faint glimmer of hope for the future. A combination of poor weather conditions in 2011 and 2012 combined with pessimistic financial outlooks conspired to suppress sales to fairly dire levels; however, the tides have turned a little in 2013. Hot summer weather followed by an uncharacteristically mild fall together with a more hopeful economic outlook have seen sales rise by up to 15 precent.

Before we start partying in the streets though, it must be borne in mind that, in reality, these figures represent increases over sales during 2010.

Undoubtedly though, one of the saviours of our trade has been the diversity of the offer at garden centres. Restaurants and cafes now represent up to 25 percent of total turnover and Christmas sales up to 20 percent. When this is coupled with gift areas, farm shops, cook shops and other product groups it is not rocket science to understand that the core gardening offer is a diminishing part of the equation. This is a slightly worrying situation, particularly as the sales are being held up by an increasingly ageing customer profile.

Consequently there is currently a move to investigate and instigate ways to attract the upcoming younger gardeners. This group will definitely use the Internet for research before engaging with retailers, therefore it is essential to reach these potential customers through Facebook, Twitter, Pinterest and other social media channels.
 

Good news about the younger crowd
Recent research carried out by Stewart Plastics also revealed that the 25-35 age group will spend an average of £300 (approx. USD $500)/ per annum where the 35-45 age group will spend £240 (approx. USD $400)/ per annum and the 45-55 age group only £200 (approx. USD $330)/ per annum therefore moving the emphasis on customer profiles could increase the average spend by 50%. Also 30% of purchases are on pots, propagators and seeds for growing their own fruit, vegetables and herbs.

Sales of traditional nursery stock ranges are declining as our customers move from long term planning to short term success. Seasonal plants that can be changed every season to accommodate new colour schemes, rectify mistakes or indeed be moved in containers as they move house are dominating the growth in the market.

Also, from a personal point of view, garden centres have been requesting workshops on merchandising as they begin to realise that traditional methods are no longer engaging customers in the way that they have in the past. Linear grids of plant types arranged in A-Z systems are not the way they want to purchase their garden plants. Instead they are looking for inspirational journeys through our plant areas with curated selections of plants arranged in themes and collections. Simply telling these customers what we are selling and how to do it does not inspire them into action. They are a generation that needs a good reason why they should choose to do something, what are the potential benefits and what results can they achieve. Garden centres therefore are realising that this will require investment in training, the incorporation of in-store technologies and essential core customer service skills in order to meet their expectations. I have also developed two entirely new workshops to accommodate the demand, one entitled “Engaging Younger Customers” which speaks for itself and a second called “Focus on Plant Winners” which covers information on the top 50 selling plants, the most frequently asked customer questions and ways of merchandising to engage the relevant customer base.

It will be a process akin to turning an ocean liner rather than spinning a sixpence but the ship is, at least, attempting the manoeuvre.
 

Kevin has worked as an independent garden center consultant to retailers, suppliers, DIY stores and trade organizations across the UK, Ireland, Europe, U.S. and Japan since 1995 and founded The Garden Works in 2001. Kevin can be reached at kevinwatersconsultancy@gmail.com
 

Perspectives from Portugal

By Karen E. Varga

I spoke with Luisa Mendes Gonçalves, contributor to Tudo Sobre Jardins, a trade publication for the garden center industry in Portugal, at the spoga+gafa trade show last fall to get her perspective. We sat and talked for quite a while, as it’s not often one has the opportunity to casually chat with other members of the international garden center industry. Portugal has a relatively small population at just under 11 million, and consequently, a much more limited potential customer base compared to some other countries. To give some context, the U.S. population is about 317 million. I was intrigued by how similar or different our markets are in her opinion.

The more Luisa and I talked, the more strongly we both felt that, in spite of the differences in size, language and climate, most of the challenges facing the Portuguese market are also prevalent in other countries like the U.S. As Luisa commented during our conversation, the garden center industry’s problems seem to be very similar no matter which end of the world you’re gardening in. Some of these challenges include: attracting a younger and/or more diverse customer base, the need to diversify products and services to survive, combatting both bad weather and the big box presence, and maintaining relevance in tough economic times.

Here is what Luisa had to say more recently, in her own words:

Here in Portugal this concept of "Garden Centers" appeared no more than 20 years ago. Nowadays if a garden center serves just to buy plants or seeds or substrates it is no longer viable. Also, with the big channels of distribution with their huge stores like Leroy Merlin or AKI, every small shop must offer more. To attract people to their business they organize workshops under several themes and in partnership with the brands sold there. The shops must be attractive. Some in the more rural places don’t mind about this but it’s a mistake. They must offer advice to their clients so they come back if they need some information.

Around the cities and in urban spaces people want to know more about growing your own vegetables. Maybe some people have more time to spend and learn about these matters. People live longer and there are also many people unemployed that need to do something useful with their time and learning new things is something accessible to everyone.

From our neighbors to the north: Canada

To get an insider's look into the Canadian garden center industry, I talked to J Paul Lamarche of JPL Consulting, a horticultural consulting firm serving North America, the UK and Australia. While he believes that retailers in the U.S. and Canada have more similarities than differences, he did point out that there is one significant difference with regards to “cosmetic chemicals,” which are now prohibited in Ontario. Ontario’s government website states “The government believes the use of pesticides to control weeds and insects for purely cosmetic reasons presents an unnecessary risk to our families and pets, especially when we can have healthier lawns and gardens without chemicals.” Here’s what Lamarche had to say about the topic:

“The government of Ontario made laws to stop the use of “cosmetic chemicals” [in 2009]. It was fought tooth and nail all the way to the Supreme Court. The bottom line is that we are managing fine without them as new companies and products are introduced to help with the problems. Naturally we still have a core group of contractors and people who travel to the USA to purchase chemicals. They usually apply them at night so as not to be caught,” Lamarche says. “The joke here is that before 1945, there were no cosmetic chemicals available to homeowners. We are now finding out how people managed to garden without these chemicals and do very well. Fact: before 1945, 6% of all food crops were eaten by insects; today it is 13%, and that is with the use of world class fertilizers and chemicals."

When it comes to how garden centers are standing out from the crowd and diversifying, Canadian garden centers are using similar methods as others. “The introduction of heirloom vegetables, herbs and perennials that attract predator insects, the sale of predator insects, eco-friendly products as well as information, is helping them to actually take market share from the box stores,” Lamarche says.
 

Catching up with colleagues in Australia

In spite of the distance and the opposite seasons, it’s not too difficult to find common ground with the Australian garden center community. I caught up with Greenworld Magazine editor Jennifer Stackhouse recently and she shared her thoughts on the year so far, since they are still in the midst of their 2013-14 busy season.

In temperate areas of Australia that experience the four seasons as we know them in North America, the Australian seasons can be understood as follows:

Summer: December to February; Autumn: March to May; Winter: June to August; Spring: September to November.

— Karen E. Varga

By Jennifer Stackhouse

Floods, fires, international awards and new plants, closures and new openings - we’ve seen it all. 2013 has been an action-packed 12 months for the nursery and garden industry in Australia.

Each year seems to go by in a rush. No matter how bright and optimistic you are on January 1, with plans to keep in touch with friends, clean out your inbox and meet all the deadlines, by the end of the year, it can seem nothing much has changed. But things do change and 2013 has had its fair share of major industry events, lots of highs and some low as well.

The high value of the Australian dollar through much of 2013 affected local spending with many consumers falling in love with online shopping sites and reducing their spending in traditional retail outlets. The high Australian dollar also fueled overseas travel, particularly garden tourism. Self-funded retirees, traditionally big spenders in garden centres, have had to tighten their belts as their incomes dropped with low interest rates.

However as the year drew to a close there was increased optimism with better retail spending in the lead up to Christmas.

Insects and edibles
With bees and pollinating insects on the critical list in the northern hemisphere, meadow plantings, pollinator plants and insect-attracting plants are an important trend overseas. Australian gardeners are continuing their love affair with backyard chooks (chickens) and veggie plots. 2013 also saw a resurgence of community gardens and top sales for blueberries. The passion for homegrown fruit and vegetables continues to drive sales for productive plants along with raised garden beds.

In commercial and high-end landscapes, 2013 must go down as the year of the green wall with vertical gardens featuring on many major building projects around the country. Growers also report good sales for easy-care landscape plants and compact trees and shrubs.

Going organic and convenient
Organic products continued to gain traction among consumers during 2013 as the major suppliers of garden chemicals, fertilisers and potting mixes opt for green. Products featuring spinosad, copper, horticultural oil, potassium, neem and vinegar were launched or reported strong sales during 2013.

Convenience is also driving new product launches for 2013 with the launch by several companies of lawn patch products and easy-to-apply fertilisers.
 

Through the seasons
This spring kicked off with a federal election and a mixed bag of weather. In southern Australia particularly in parts of Tasmania, spring was cold and wet. For New South Wales and Queensland it was hot and dry sparking early heat waves and in some area severe bushfires. The dry conditions finally broke in along the east coast in November with storms, which included typhoons, hail and severe thunderstorms. Across in the west warm temperatures after the wet weather of late winter and early spring were encouraging for gardeners and plants alike.

With warming conditions down south and more rain up north it’s fingers crossed that late spring and early summer can deliver good sales.