Monday, October 13, 2008

2009 Florida Environmental Horticulture Industry Prognosis

The following is in response to a request from the Ornamental Outlook Magazine to provide my thoughts of the 2009 market for the Florida Nursery and Landscape industries.

I do not claim any prognostication abilities, but here's a few thoughts:

I sense this economic crisis is like a bad cold. It will get worse before it gets better and it will take as many days to recover back up from the worst day, as it took to get down to the worst one. Hopefully, it is not an incurable disease! And hopefully the stimulus packages being put together across the globe will be the right medicine needed. If we ever had any doubts about the legitimacy of being a global village, may be this worldwide economic crisis will convince those skeptics.

As far as our industry goes: For the most part, our industry has followed the curves and bends of the building and real estate markets that accompany discretionary spending associated with bull markets. That's not to say that it should be that way. Many industries are less effected by down turns. For example people will still go to the doctor when sick, because that is a Quality of Life issue that is a must. We have been reactive and not as proactive in this regard. I feel that our industry needs to be more proactive in continuing and expanding the promoting of the Environmental Horticulture industry's products as necessary Quality of Life products... not something that is optional. Some examples of plants being a required Q of L purchase include: interior and exterior air purifiers, energy saving and the original GREEN products, stress relieving outdoor rooms that create a sanctuary from the rat race outside, and spending more time enjoying your back yard as a Staycation destination - for example - saves money while at the same time adding value to the home and generate more entertainment opportunities that also add to ones Q of L. And don't forget the ability that only plants have to create a natural environment at home that is also associated with a back to nature Q of L component attracting wildlife and generating a sense of peace.

But, even if we more aggressively adopted and promoted these ideals at the highest of levels, it would probably take years to make a paradigm shift accepted by the masses, and so for 2009 I am preparing for market conditions to be worse (if they are better... great! And I will happily accept everyone's "You were wrong"), as individual states and government entities continue to cancel large projects from lack of taxes and other funding, banks continue to heavily screen lending (if someone even wanted to build), political fears add to concerns of the future, and Wall Street tries to recover, to name just a few contributing factors.

I sense that the wholesale plant growers who have no service divisions will suffer as they try to keep up quality inventories while competing in a market of previously over produced, and mostly paid for, surplus. And with current growers selling plants for half of what they were 30 years ago, just to generate cash, how inventories will be replenished seems to be a cross-that-bridge-when-I-get-to-it mentality for many right now. Nurseries going to auction will also add to the devaluation of product. The landscape companies that have cut expenses to the bone, gotten creative by thinking outside the box, and have enjoyed a solid customer base will hopefully survive, but with more competition for fewer jobs, quality and service levels will have to remain high, or even higher, even with the lower prices needed to sell the work. High end residential and commercial Lawn Maintenance companies who have a solid customer base and established business will probably feel the strain the least, as those customers are less likely to start pushing mowers as a way to cut back expenses. But as more landscapers and others, see the lawn maintenance market as a way to survive, pricing will probably decline as well, as hungry companies vie for the remaining work.

In a nutshell, I sense that all segments of the Environmental Horticulture Industry will have to "do a lot more, for a lot less" than they have been used to, in order to survive. In addition, having no sacred cows accompanied by creative diversification will be the game plan for many companies in 09'.

Finally, it’s obvious I am not a head-in-the-sand optimist, nor am I a sky-is-falling pessimist. I call myself a realist. But a realist, with optimistic “silver-lining” tendencies, as I feel times like these call for a very beneficial and positive recounting of all our blessings to help put things into perspective. A perspective often lost when we are in the “me” mentality often associated with good economic conditions. And I think it would do us all good to get back to a “being thankful” and “this is the day” mentality, as we return to putting a more basic emphasis on things like: health, honor, acceptance, freinds, family, freedom, safety, peace, and love, to name just a few.

Gary Roberts

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