STRUCTURE OF THE FLORIDA WHOLESALE WOODY ORNAMENTAL NURSERY INDUSTRY

Transcription

1 362 FLORIDA STATE HORTICULTURAL SOCIETY, 1968 Chemical Composition Foliage analyses data for the simple effects of N, P, K, Ca and Mg are given in Table 3. Nitrogen. Plants receiving AN had more foliage N than those given UF, but there was no difference between plants given UF and AN in linear growth, and quality was similar at the high N level (Table 2). High N level plants contained more foliage N than low N level plants. KS had no effect on foliage N. Phosphorus. Plants receiving UF had less foliage P than those given AN, but the difference was slight and probably of no biological signifi cance. NL and KS had no effect on foliage P. Potassium. Though equivalent amounts of K were applied, plants receiving potassium sulfate had more foliage K than those given potas sium chloride, possibly because potassium chlor ide was leached to a greater degree from the containers. There was, however, no effect of KS on linear growth or visual grade. There was less foliage K at the high than low N level. In a factorial experiment with 'Formosa* azalea Dickey et al. (6) found that foliage K de creased as N levels increased at the 3 K levels. Calcium. There was more Ca in foliage of plants given AN than those receiving UF, but the difference was slight and probably of no bio logical significance. There was more foliage Ca in plants given potassium chloride than in those receiving potassium sulfate, and conversely there was less foliage K in plants receiving potassium chloride than in those given potassium sulfate. This influence of K on the uptake of Ca by plants has been reported many times in the literature. Foliage Ca was not affected by NL. Magnesium. Plants receiving potassium chloride had more foliage Mg than those given potassium sulfate, and conversely plants receiv ing potassium chloride had less foliage K than those given potassium sulfate. This decrease in foliage Mg resulting from an increase in foliage K has been widely reported in the literature. NS and NL had no effect on foliage Mg. Foliage Mg values for 'East Palatka' holly were considered to be in the "luxury consumption" range. LITERATURE CITED 1. Bush, Charles S Grades and standards for nursery plants Part II palms and trees. Division of Plant Industry, Fla. Dept. of Agr. 2. Dickey, R. D Factors affecting the growth and quality of woody ornamental plants. Ann. Rept. Fla. Agr. Exp. Sta. p Dickey, R. D. and R. T. Poole A comparison of slow release with readily available fertilizers on growth and chemical composition of Rhododendron indicum 'For mosa'. Proc. Fla. Sta. Hort. Soc. 78: Dickey, R. D. and R. T. Poole Effect of ap plication time of slow release and readily available nitro gen and potassium sources on growth and chemical com position of Rhododendron indicum 'Formosa'. Proc. Fla. Sta Hort. Soc. 79: Dickey, R. D., R. T. Poole and J. N. Joiner Effects of nitrogen and potassium levels and two applica tion intervals on growth and chemical composition of Rhododendron indicum and Viburnum suspensum. Proc. Fla. Sta. Hort. Soc. 74: Dickey, R. D., R. T. Poole and J. N. Joiner Effect of nitrogen, phosphorus, and potassium levels on growth and chemical composition of Rhododendron indicum 'Formosa' and Viburnum suspensum. Proc. Amer. Soc. Hort. Sci. 91: STRUCTURE OF THE FLORIDA WHOLESALE WOODY ORNAMENTAL NURSERY INDUSTRY Cecil N. Smith University of Florida Gainesville Abstract Information on industry marketing practices and other economic characteristics of the whole sale woody ornamental nursery industry in Flor- Florida Agricultural Experiment Stations Journal Series, No ida was obtained from a sample of 200 operators. Similar information was acquired from nursery men in the ten other states which participated in the Southern Regional Project on Marketing Woody Ornamental Nursery Products. Esti mates were made of nursery industry character istics in each participating state. The individual consumer was the major buyer of Florida woody ornamental nursery products in 1965; 44 percent of the value of products sold were purchased by consumers. Landscape and retail nurserymen purchased 19 and 14 percent,

2 SMITH: WOODY ORNAMENTAL ECONOMICS STUDY 363 respectively, of the woody ornamental stock sold by Florida nurserymen. Introduction The nursery enterprise in Florida has sus tained a very rapid growth in the post-world War II period. Sales of all nursery products produced by Florida growers rose from $3,929,- 000 in 1940 to $9,986,000 in Nursery mar ketings were $16,037,000 in 1959 and $21,517,000 in 1964 (1). The Census data include not only woody ornamentals, but also citrus, deciduous fruits and nuts and other types of nursery stock. Results of an earlier study on marketing channels for Florida nursery products were pub lished in these Proceedings in 1963 (2). The sales classifications utilized in that research dif fered from those reported here. The earlier re search showed that, of total sales of $24 million, including fertilizers, insecticides and other sup plies, by nurseries selling ornamental plants, approximately a third were at retail, a third were marketed through direct landscaping and the remaining third were sold to wholesale buy ers. More than $20 million of the total sales con sisted of major nursery products, including cit rus and other fruit trees. The purpose of the research reported in this paper has been to delineate the structural char acteristics of the wholesale growing phase of the woody ornamental nursery industry in the eleven states participating in the Southern Regional Project on Marketing Woody Ornamental Nurs ery Products. The specific objectives were to de termine movement patterns, marketing channels, handling practices and pricing practices for woody ornamental nursery products. Some of the key findings of the study with special reference to Florida are presented in this paper. Some comparative data on nursery in dustry characteristics in other states are also delineated. Procedure In Florida, as in other participating states, an essential step in the research procedure in volved the selection of the nurserymen to be contacted for information. In 1965, letters and postcard questionnaires were sent out to nurs eries listed by the Florida Division of Plant In- Tabie 1. Selected Characteristics of Florida Woody Ornamental Nurseries by Period of Establishment, 1965 Period Proportion Nurseries of Average Value of Sales per Nursery Percent Pollars Before 1930 $ 79, ,621 19^0 - ks I ,299 22,827 25,527 Al1 Nurseries

3 364 FLORIDA STATE HORTICULTURAL SOCIETY, 1968 dustry as producing woody ornamentals. The Computer tabulations of data and expansion nurseries queried were asked to supply basic in- into state and regional estimates were carried formation about the size and composition of their out by personnel in the Department of Agriculoperations. The population under consideration tural Economics and in the Computer Center at in this study consisted of those nurserymen who the University of Georgia. Expansion factors produced and sold $2,000 or more of woody or- for Florida were based on the sampling rate and namentals. on several other data sources. In the expansion A stratified sample with differential rates of process random samples of various schedules sampling for firms with sales of less than $50,000 were made by the computer and the number of and for those with sales of $50,000 or more was nurseries reported was expanded to the 552 designed. A random sample of 200 Florida shown in several tables in this paper, nurserymen was selected and the nurserymen Studies of the retail nursery enterprise and chosen interviewed at their places of business. the mass marketing of nursery products, both The data, collected in 1966, related to business separate phases of the overall regional project, operations in the preceding year. are currently being conducted. Florida is par- Comparable data to those in Florida were ticipating in this research as a member of the obtained by researchers in each of the other co- Southern Regional Technical Committee on Maroperating states. Similar schedules were used keting Woody Ornamental Nursery Products and the sampling procedure in each state was (SM-33). developed in consultation with the Technical Committee of the regional project. Table 2.--Value of Sales of Woody Ornamentals, per Man Hour of Labor Employed, States of the Southern Region, & Firms with Sales of State Less than $50,000 $50,000 or More All Firms Dollars/Man Hr. Dollars/Man Hr. Dollars/Man Hr. Alabama Florida if. 04 Georgia Kentucky Louisiana Mississ ippi North Carolina South Carolina Tennessee Texas Virginia ** 2.81 Region

4 SMITH: WOODY ORNAMENTAL ECONOMICS STUDY 365 Industry Characteristics Nursery Numbers and Sales. Florida woody ornamental nurserymen account for 42 percent of the estimated total number of nurserymen in the eleven-state area. Their sales made up a third of the regional total. Individual proprietorhip was the major type of business organiza tion; 369 of the 552 nurseries had private own ers, 130 were organized as corporations and 53 were partnerships. Average sales for all Florida nurseries were $30,581 the lowest for any of the Southern States. The eleven-state average was $39,519. Corporate nurseries in Florida had average sales of $61,351, proprietorships $20,316 and partner ships $26,577. As in the regional picture, those Florida nurseries established prior to World War II had higher sales than those established in the 1940's and later decades (Table 1). Florida nurseries established before 1930 had average sales of nearly $80,000, more than three times the level for those which began operations after More Florida nurseries were established in the years from 1950 to 1959 than in any other period; 48 percent of Florida nurseries began operations in this period as compared with 42 percent in the entire region. Only 14 percent of the Florida nurseries operating in 1965 were in existence prior to This compared with 23 percent of the total number in the Southern Region. Labor Productivity. When the relationship between the value of sales of nursery stock and the man-hours worked is examined, nurseries in Florida ranked higher in value of sales per manhour of employment than those in any of the other states studied. Sales per man-hour of employment ranged from $1.85 in Mississippi to Table 3.--Value of Sales of Woody Ornamentals in Florida by Location and Type of Buyer, 1965 Type of Outlet Value of Sales Dol lars Percent Local Sales I nd i v i dua1 consumers Retailers Wholesalers Other growers Public agencies Landscape contractors $ 7,402,300 1,956, , , ,200 2,513, k.k \k.9 All Local Sales 13,680, Distant Sales Southern cities Cities outside South 2,822, , Al1 Distant Sales 3,200, All Sales $16,880,

5 366 FLORIDA STATE HORTICULTURAL SOCIETY, 1968 $4.04 in Florida and averaged $2.87 throughout the entire region (Table 2). In addition to any advantage enjoyed by Florida because of a high er rate of nursery productivity, a part of the difference in sales per man-hour is probably explained by relatively more of the sales in Flor ida being made at retail prices than those in the other states. Florida nurserymen, on the average, em ployed 4.3 workers. The representative nursery in each of the other states employed more per sons than this. The average number of employees per nursery was 15.6 in Alabama, 10.3 in Georgia and 6.8 in the eleven-state region. Sales Outlets and Distribution. Eighty-one percent of all sales made by Florida nurseries in 1964 were to local buyers (located within 25 miles of the nursery) and 19 percent went to distant buyers (Table 3). Individual consumers were the major type of buyer. Landscape sales made directly by nurserymen are classified as direct sales. Landscape contractors and retail nurserymen ranked as the second and third most important outlets. Florida growers sold 17 percent of their plants to buyers in Southern cities, including markets in Florida located 25 miles or more from the business locations of the wholesale growers. Of the estimated $2,822,500 in sales made by Florida nurserymen to buyers in Southern metro politan areas, almost $1,850,000 were to buyers in Florida. The remaining $972,000 were sold to buyers in other Southern States. Only about 2 percent of the nursery output of Florida whole sale growers went to buyers in cities outside the South. In contrast with the high proportion of local sales, doubtless because of a higher concentra tion of and a faster growing population, made by Florida nurseries, the majority of nursery product sales in Alabama was to distant buyers. Purchasers outside the South bought an esti mated 22 percent of the plants marketed by Alabama nurseries. Louisiana nurseries made relatively fewer local sales than nurseries in any other Southern State; only 18 percent of the nursery stock was sold to local outlets. In each of the other states half or more of all sales of woody ornamentals was moved to local buyers. Wholesale producers of woody ornamental nurs ery stock in Kentucky, Mississippi, South Caro lina, Tennessee, Texas and Virginia all marketed Table k.--methods of Establishing Prices for Woody Ornamentals by Florida Nurseries, 1965 Pricing Method No. Indicating Method as Most Important Relative Frequency No. Percent Imitate prices of larger, nearby nurser ies Cost of production Aim at set profit margin Q.ual i ty of grades Supplies of product in the area Other k Total 100.0

6 SMITH: WOODY ORNAMENTAL ECONOMICS STUDY percent or more of their output to local buyers. Pricing Procedure. The imitation of prices set by larger, nearby nurseries was the leading method reported by Florida wholesale nursery men in establishing prices for their products (Table 4). More than a third of the nursery men interviewed stated that they set their prices at the approximate level of those established by larger nurseries in their vicinity. Almost as many nurseries noted that they used production costs rather than imitating prices of adjacent operators as their primary method of price determination. Other nurserymen listed grade quality, the local supply situation and other factors as being important in their decisions on determining prices. In summary, it appeared that large nurseries tended to be price leaders and the smaller ones followed their lead in setting prices. Production Problems. Florida nurserymen classified weed control, weather hazards and la bor shortages as their major production prob lems (Table 5). Additional problems included insects, lack of production capital, wage rates for unskilled labor, irrigation and others. Marketing Problems. One of the major mar keting problems reported was changes in pref erences for different kinds of plants (Table 6). Nearly two-thirds of the growers interviewed classified this as a marketing problem. Approxi mately the same number of growers responded to a question about changes in preference for different plant forms. Nevertheless, fewer than 38 percent indicated this was a serious problem. Table 5.--Frequency Distribution of Major Production Problems of Woody Ornamental Nurserymen in Florida, 1965 Problem Number of Responses6 First Second Third Total Weed control Weather hazards Labor shortage Insects Lack of production capital Wage rates for unskilled labor Irrigation for field plantings D iseases Suitable soil for container plant i ng Ferti1izing Suitable soil for field planting Nematodes aof nurserymen actually rating these problems among their first categories. three

7 368 FLORIDA STATE HORTICULTURAL SOCIETY, 1968 Table 6. Frequency Distribution of "Yes" and MNo" Answers Concerning Marketing Problems of Woody Ornamental Nurserymen in Florida, 1965 Marketing Problem Responses "Yes" "No11 Total Proportion "Yes" of Responses No. NQ. No. Percent Changes in preference for different kinds of plants Changes in preferences for different plant forms ^ Sell plants directly to state, federal or other public agencies Sell plants to landscape contractors for use in community or highway beaut ifications Problems with transportation facilities or agencies 54 < Can you split shipments among customers? Problems in extending credit to customers Problems in obtaining credit from suppliers Is adequate information avail able concerning markets? Two-thirds of the nurserymen responding felt there was adequate information available concerning markets for their products. The number responding "yes" and "no" to various questions relative to marketing are noted in Table 6. In interpreting the data a "no" re sponse in some instances means a more serious marketing problem than a "yes" reply. Other Findings, Of the nurserymen re sponding, 84 percent said that prices for specific grades and sizes of plants were reasonably sta ble. Two-thirds of the nurserymen sold plant under their own label while only 9 percent re ported the packaging of any plant with buyers' labels. Additional findings of the study are now in process of publication as a proposed Southern Regional Research bulletin. It is anticipated that detailed estimates on various characteristics of the wholesale woody ornamental nursery enterprise in Florida will be released in an economic research report.

8 SMITH: CONSUMER OPINIONS FLOWERING PLANTS 369 Acknowledgments Appreciation is expressed to Dr. Dana C. Goodrich, former Visiting Professor of Agricul tural Economics at the University of Florida, for his assistance in this study. While serving as a member of the University of Florida staff dur ing a sabbatical leave from Cornell University, Dr. Goodrich planned the sample and supervised the collection of data when the author was out of the country on a foreign assignment. LITERATURE CITED (1) U. S. Bureau of the Census. U. S. Census of Agricul ture. Washington: U. S. Government Printing Office, 1941 to (2) Smith, Cecil N. "Marketing Channels for Florida Nurseries," Proceedings of the Florida State Horticultural Society 76: (1963). A STUDY OF CONSUMER OPINIONS AND PRACTICES ABOUT FLOWERS AND FLOWERING PLANTS Cecil N. Smith University of Florida Gainesville Abstract A majority of the 197 residents interviewed in Gainesville, Florida during the summer of 1964 had flowers and living foliage plants in their homes. The purpose of the study was to as certain consumer opinions and practices with re spect to living and artificial cut flowers and fo liage plants. Most persons interviewed had the overwhelming opinion that fresh cut flowers and foliage plants added to the enjoyment of living. During the 12 months preceding their being interviewed the 197 Gainesville families had average expenditures of $15.50 for cut flowers, $4.63 for living foliage plants and $2.75 for artificial flowers and foliage. Despite a small number who identified im proper flower handling procedures as those which should be followed, the ratings in this area, by the persons interviewed were generally correct. Results showed a preference for florists shops over supermarkets as places to buy flow ers. On the other hand, consumers who expressed interest in prepackaged flowers preferred to make such purchases in supermarkets. Florida Agricultural Experiment Stations Journal Series No Introduction Florida currently ranks as the nation's second most important flower producing state. It leads the other 49 states in the production of pompon chrysanthemums, gladiolus and green foliage plants. A knowledge of market characteristics is extremely important to the continued well-being of the flower industry and its allied groups. Ad ditional information on consumer practices is necessary in order to encourage the further de velopment of flower consumption in the home as contrasted with that for funerals, weddings and other special occasions where it is customary to buy flowers. The study reported here was done to deter mine the practices and opinions of consumers in Gainesville, Florida with respect to flowers and other products. It is possible also that it may point up fruitful avenues for industry market ing programs as well as future research en deavors. Review of Literature Available evidence, which is more intuitive than empirical in nature, indicates that the de mand for flowers for "necessary" purposes tends to be inelastic, but that an apparent elastic de mand exists for flowers purchased on impulse for lwith an elastic demand, total returns to the seller in crease with a decrease in prices; with an inelastic demand, total returns to the seller decrease with a decrease in prices.