COVID-19 and Selling Plants
For many in the horticulture business the last few weeks have been a waking nightmare. Don't get me wrong - it has been fantastic to see so many people taking to their balconies or gardens. There has been a gloomier side to recent events, though.
The damage done to traditional garden centres is pretty well known. By "traditional", I mean bricks and mortar businesses. Not only were they - understandably - forced to shut, but more recently they have had to suffer the added indignity of having local garages and country stores staying open and expanding their offers in compost and bedding. Even worse, now people like B&Q are open as "essential businesses".
Garden centres are allowed to operate a click and collect or local delivery service,are re-opening. but as a customer I'm not supposed to drive to buy non-essential goods. Huh? In any case, they have had to completely change their staffing and business models and redesign websites, sometimes adding payment gateways for the first time.
This is beyond many retail businesses, of course. Smaller plant centres were making so little money anyway they can't possible adapt, and have just had their most lucrative trading period wiped out. Sometimes their efforts to cope bring more problems - a nursery near us is currently doing local deliveries with no minimum order size, for example.
Many growing nurseries also have garden centres attached. They're doubly cursed. Growers have traditionally had three retail sales outlets; mail order/internet, trade (garden centres and designers), and garden shows. Two out of the three suddenly disappeared. Worse, all their corporate, government and NGO business walked out of the door at the same time.
Well, I hear you say - why don't they just concentrate on supplying the other segment of their business? Online sales have gone bananas. I had an email from Dobies the other day; at one point they had a 54,000 order backlog. Suttons introduced a virtual queueing system on their site. Even our seed packet volumes are up 500% y/y.
There are lots of reasons why it's difficult to switch markets. Plants grown for online sale are very different, to start with. We are having a terrible time supplying aquatic plant plugs, for example, as the nursery is used to growing 9cm pot plants - much more difficult to ship. Supply is inflexible - you can't just put together a plant to order for delivery next week.
Suddenly none of the plants grown abroard are available, so while we have fantastic gluts of the wrong sorts of plants - like bedding - there are shortages of others - vegetables, for example (and aquatic plug plants, apparently!!!).
Then there are delivery logistics. It's increasingly difficult to guarantee a customer's plants are going to arrive promptly and in one piece, particularly if you're not used to packing large numbers of products. We've had enough problems with seed, let alone live plants.
And lastly is a perennial and over-arching issue - the cost of selling plants. You might just about make sense of the pitiful margins involved in growing or selling plants if you run a garden centre which sells teas and gifts as well as bedding. Your staff can give advice while keeping the stock healthy, and there are plenty of opportunities to cross sell.
Selling plants online sounds like the perfect opportunity to do away with that. You can use videos, blogs, infographics to answer those questions.
You can - and it will definitely help - but people like to ask questions. And understandably, too. Their problem is unique - that's the joy of gardening. In the current environment we're dealing with a lot of folk too who have no gardening experience - which is great - but this means an investment of time on the phone (if customers can get through) or on email. You can't just hire anyone to do this - they need to have a wide range of experience and horticultural knowledge, and be prepared to spend 20 minutes talking to a customer who buys a packet of seed for £7.50.
Increasingly extreme weather means there will be even more requests for replacements of seed or plants which have died. We will get complaints about waterlogged seed and plants and, now, failures because of the amazingly dry conditions this spring.
Growing has its own problems. Not least as it's so labour intensive. Nurseries here haven't been able to invest in ways to improve productivity. If you can pay as little as most in the sector are, why bother? When half your workforce then disappears because of illness, suspected illness, or working conditions you are even more screwed. In the meantime, what are you going to do with all those contract grown plants left sitting in the yard when your customer revoked on your contract?
Amazon's most recent results - released the other day - beautifuly illustrated another problem. Their top line is going mad, but the expenses involved in supplying and delivering in the new world are rocketing up even more. We're seeing this ourselves (albeit on a slightly more modest scale - Ed.). The lucky ones - growers and retailers who were thrilled to be shipping huge volumes of plants for online - are only now waking up to the impact on their margins this is having.
You can ship twice the number of plants you usually do, but if they're then delivered five days later by an over-stretched carrier and they're dead, that's not much help. You have to find a more expensive but more reliable way of getting plants to people.
Your staff will have to have different work patterns and conditions, and limited output. They will be working much longer hours, with many more absences. They will need PPE. They may fall ill and have to self isolate. You will have to invest in new production systems.
Packaging material is hard to find and expensive if you run out. Lead times extend and inventory controls and order systems need to be improved to cope with much increased volume. Many growers have had to run for years on a shoe string - their systems are held together with string and sealing wax. So few have been going into horticulture that there's an age problem as well. These businesses are typically run by older folk who might not be as tech savvy. They're worn down too, by years of just getting by.
Many growers and retailers will go bust, regardless of how they're selling. It's a particularly bad time for this to happen for the consumer, as Brexit will mean fewer plants coming into the UK from Europe for sale.*
This all points to one inescapable fact... as with many things on planet COVID, plants are going to get more expensive. About time, some might say.
*Possibly no bad thing in terms of biosecurity.