Bust and boom

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After a slow start to spring amid the coronavirus outbreak, sales are up. But how long will it last?

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June 22, 2020

photo © Lya_Cattel | Istock

During the ongoing coronavirus pandemic, economies around the world have changed as many consumers are facing shrinking budgets and staying home more for their own safety. In the United States alone, unemployment hit 14.7% in April, according to the National Bureau of Labor Statistics. Studies from the Pew Research Center indicate that this number is higher than the peak of the unemployment rate during The Great Depression.

However, green industries have seen sales boom despite a struggling economy. Growers in both the U.S. and Canada have seen sales rise, sometimes as much as 20%. In interviews with Greenhouse Management, growers say that while there is a high number of returning customers, more new customers came out this year during the already busy spring season. With little else to do, they came out to buy plants for their homes.

“It’s been completely different, of course,” says Laura Kalf, the garden center team leader and buyer at Landscape Garden Centers in Sioux Falls, South Dakota. “I’ve never seen anything like it. There was just so much uncertainty in the world.”

In Sioux Falls, Laura Kalf says Landscape Garden Centers has 'never seen anything like' the 2020 spring season.
Photos courtesy of Laura Kalf
Growers in the U.S. and Canada say that sales during the busy spring season rose after sales dropped in March.

“Usually, it feels like there’s this slow climb to the mountain. This year, we’ve felt like we’ve been at the top of the mountain for several weeks.”

It is unclear if strong sales this year will lead to more repeat customers in 2020. The Federal Reserve also expects the economy to remain weak for the rest of 2020 and for unemployment to end the year at 9.3%. Before the pandemic, the unemployment was around or below 4%. Additionally, rising sales in the spring season are the reverse of what most growers reported at the beginning of the pandemic.

According to a survey conducted by Greenhouse Management in late April, 69% of growers reported decreased sales vs. 11% reporting increased sales, and 21% reported no change at all. The survey was published in the May issue, and is available here.

And as summer goes on, many businesses are unsure if customers who came later in the spring will still be buying plants in July and August. What is clear for now, though, is that business is booming.

Maple Greenhouses

Location: Lowbanks, Ontario, Canada

On the North shore of Lake Erie, about 45 minutes south of Hamilton, Maple Greenhouses primarily grows spring annuals with a focus on begonias. The operation has about 75,000 square feet of greenhouse space and has primarily sold to independent garden centers since the late 1990s.

According to Cody Blyleven, the general manager at Maple Greenhouses, the trickiest part of this spring was waiting to see if they’d be able to sell any plants at all.

“We didn’t know if we’d be able to sell because our customers couldn’t sell,” he says. “But the government did eventually open things up, garden centers got really busy and, as of the first week of June, most of our customers are empty. Believe it or not, we had a record May.” Blyleven says in a normal year, 80% of the company’s product moves in a three-week period in May. This year, 100% sold over that time.

Back in March, however, Blyleven says the company cut back on its 4-inch annuals when there was no way of knowing what sales would look like. The thought, he says, was that by scrapping plugs then, it would be less of a loss than growing the plants all the way and then not being able to sell them at all.

Now, however, he wishes they had kept growing.

“We’re kicking ourselves in the butt a bit because we could have sold it all,” he says. “But at the time, you could only do what you thought was right.” Going forward, the hope is that more sales will come when Toronto allows farmers markets — a key source of income for the businesses — to return.

One other concern for Blyleven was labor. At peak season, they employ 30 employees and are now down to five or six. This year, five workers came in from Mexico on temporary visas with 25 locals filling out the staff. In a normal season, the locals would work alongside the foreign laborers. Amid the pandemic, however, he split the groups up into two shifts. The two groups never crossed and extra cleaning was done at the end of each shift. Cody ran the locals’ shift with his younger brother Luke overseeing the other shift.

Still, Blyleven considers himself fortunate to have the help at all.

“We got really lucky — our last guy showed up on March 10 and everything started a few days later,” he says.

Millcreek Gardens

Location: Ostrander, Ohio

Restrictions differed for growers, but most reported higher sales than expected this spring..
Photo courtesy of Laura Kalf

At Millcreek Gardens, a perennial and herb grower located in Ostrander, Ohio, 2020 was supposed to see batch pulling implemented. That will still be the case. But, due to coronavirus, it was delayed to allow for easier social distancing for employees.

According to director of growing Fred Higginbotham, the business spent about a year planning and building a new shipping area on the company’s property. Currently, orders are pulled individually. The process will see Millcreek pull around 25 plants at a time, thus limiting the amount of trips needed to fill orders. Higginbotham says the new system was adopted by Millcreek after he, owner George Pealer and others visited other nurseries in Ohio and along the East Coast using it.

“It really helps eliminate drive time,” he says. “Once plants are picked, there will be what’s called a ‘supermarket’ where plants are placed and orders ‘shopped’ individually. The shopping list will tell you exactly where the plants you need are and how many you need. In the spring, one of our biggest hurdles is just pulling as many orders as we can in a day.” Higginbotham hopes batch pulling can start at the end of June when order sizes drop and fewer workers are needed.

Still, Millcreek has had a busier than normal spring.

“The demand has been unreal this year and almost hard to plan for,” Higginbotham says. “Our inventory is at one of its lowest points its ever been just because sales have been so incredible.” Still, Higginbotham realizes that this is an odd time for everyone and will likely be that way for the foreseeable future.

“You normally wouldn’t be wearing a mask when it’s 80 degrees outside, he says, “but people know we are doing it for protection. This has definitely caused some challenges, especially with the big picture planning for next year’s crops. Can we anticipate this much buying again? Or was this a fluke year? But for now, we are trying to make the most out of 2020.”

Landscape Garden Centers

Location: Sioux Falls, South Dakota

According to Laura Kalf, Landscape Garden Centers has remained busy into June after the initial bust of heavy spring sales. The company, a grower/retailer that grows roughly a quarter of its own supply, has been busy from the beginning of the coronavirus pandemic. While the stores are open now, they have implemented ordering via Facebook, curbside pickup and local delivery. The alternative ordering measures were implemented as a courtesy for customers who felt hesitant to come into the store amid the pandemic.

“I’m really impressed with the numbers we’ve been doing, especially since this past week [in June] we had so much heat,” she says. “As far as the spring goes, every day felt like a weekend day. We’re half-staffed. We split ourselves into two teams just in case something did happen and then we’d at least have half of our staff to still run the garden center or figure something out. That was an adjustment to make when you’re doing so much more volume.”

South Dakota, unlike most other states in the U.S., did not issue any shelter-in-place orders, so Kalf says that her environment may not have felt the same impact on business as others. On a city level, it was up to each business to decide what was right for it. The company, in line with state mandates, does not have a mandatory mask policy in place for employees or customers. About half of both are wearing masks, she says. One notable change this year, Kalf says, is that there are consistently new customers she or anyone else haven’t interacted with before. Heading into June, sales dropped a bit from a busy May and they aren’t sure what the rest of the year will hold. The hope, though, is that they have added at least some new store regulars.

“Sioux Falls is a larger populated area, but we know a lot of our customers by name,” Kalf says. “But I’d say half of the people that came in here in spring had never been here before. Which I think is just incredible and my hope is that now and months ahead that this won’t be a one-time deal for them, especially the younger crowd.”

Guthrie Greenhouses

Location: Guthrie, Oklahoma

Despite a strong spring, many growers are unsure about sales throughout this year and into 2021.
Photos courtesy of Laura Kalf

While Guthrie Greenhouses dabbles in cannabis, its focus is 12.5 acres of greenhouse ornamental production. In the greenhouses, owner Jesse Tischauser primarily grows bedding plants for a variety of customers. Tischauser co-owns the business with his wife and father-in-law, and has been at the business since 1997. Amid the pandemic, the business was declared essential by the state, although the city of Guthrie mandated citizens to wear masks when in public.

This year, he says, a large chunk of his time has been spent building greenhouses for both bedding plants and cannabis to be grown in. Cannabis is new and exciting in Oklahoma — licenses to grow just recently began being passed out — but Tischauser says the bedding plant business hasn’t slowed down. That’s been especially true this year, with sales rising about 20% over 2019’s numbers.

“It has been crazy down here. Everyone planted plants sooner than ever before and more than ever before,” he says. “We sold out of bedding plants by Mother’s Day this year, which is by far the earliest that we’ve seen our spring season end.” Tischauser attributes this directly to people being stuck at home and needing something to do amid the coronavirus pandemic.

“People were out at the garden centers like never before,” he says. “We’ve got a small garden center in our town here and it had a record year.” In one instance, Tischauser said a customer came looking for more plants for a landscape project after Guthrie Greenhouses sold out. That customer ultimately came into the garden center, bought plants at a more expensive retail price and told Tishacuser that he was still turning a profit.

“We usually ship our spring production over six weeks,” he says. “This week, we had two weeks that were really, really busy. We shipped everything we could, and people were mad that we had nothing left.”

“It has been crazy down here,” says Jesse Tischauser. “Everyone planted plants sooner than ever before and more than ever before.”