Laboring with the Future
Notwithstanding the surplus of Nor’Easters on the east coast and a “River of Rain” on the west, the calendar says it’s spring and consumers are absolutely dying to do something in their gardens.
So, what are your exciting anticipation points this spring?
- A stronger economy increasing the average spend?
- Droves of excited new consumers as Millennials finally get gardening?
- The continued surge in sales of houseplants, succulents and other millennial “stuff”?
- A shortage of some plants as landscapers vacuum up supplies?
- On-line sales and advice challenging your status quo?
Nope. If I ask that question to owners of garden retail stores the immediate response is one, ever-present word or subject – Labor. “How are other companies you know finding people? What are they paying or promising? How are they keeping them?”
This year’s garden retail business story is all about Labor, or the lack of it.
The short term answers for this year include paying more than you think the job is worth, offering several part-time positions for each full time position, end-of-season bonuses, raising prices to cover increased labor, reducing some categories that just soak up labor hours and quite frankly, doing without.
Time to Change the Model
I think this is the kick in the seat the industry needed. For years the garden business has depended on finding thousands of educated dedicated people to work long and hard for average earnings because they loved the product and the process. The “secret sauce” of the business model was that our work force held the essential information for consumers who loved the end result of gardening, but were fearful of failure. Householders had to come to our stores if they wanted assurance and success.
Well, no more. Now that consumers can source, research and buy so much on-line, retail employees are no longer the first-providers of crucial how-to information. That powerful position is gone forever (and it was powerful).
The role of retail teams has changed to one of validation or correction of what consumers have already learned. Employees are now in effect the curators (I hate this word, sorry) of all that on-line information, the selectors of all those products and mentors of all those on-line promises. They are now there to advise which particular soil exists in this area, what the best hanging basket plant is in their location, how many pounds of potatoes you realistically can expect from those cute fingerling things.
Of the three bedrock principles of garden retailing (Quality, Selection and Service), Quality is now a given while Selection is now universal. Only Service can be a unique differentiator, but it can’t be hand-holding service any more.
This role still takes education, professionalism and passion too, but much of it can be delivered by “silent selling” on-site with re-thought merchandising and signage and You-Tube type videos. All of which means a very different use of those valuable employees but in the longer term requires less on-site educated year-round help.
This might seem like sacrilege to the traditionalists but consumers are so used to (and some even truly PREFER) self-service on-line from Amazon to car insurance that even a partial hand-holding garden retailer has the competitive advantage. The retailer still holds the cards with credible, knowledgeable employees helping where necessary, still local, still passionate.
So I think we are finally moving to a model where shoppers can browse, read, learn, view and buy “silently” or be helped by a few very credible and helpful people on patrol – a bit like one of my favorite stores, REI.
This eventually means we will have less employees by design… but they will be making more money (and that must be nothing but “a good thing” as someone once said).
But for this year, what are your short-term tactics to get you over the labor challenge? Let us know in the comments: sharing is caring!
Photo Credit: taken by Ian at TreeHouse Store in Austin TX
Ron VanderhoffMar 28, 2018 at 6:53 pm
Spot on, as usual Ian. Seems like there might be two labor issues. There are the “know-it” people, who have a passion for plants and gardens and so on. They are the hand-holders and validators for those that come to us with half their decisions and information, but need us to make them confident in those decisions, reassure them and then close the sale.
Then, there are the rest of the staff, which we depend on in a huge way and that do a bulk of the dirty work (sometimes literally). These are the recievers, stockers, maintainers and to some degree the cashiers, carry-outs, deliverers and so forth.
In our market we have pressure on both of these groups, but maybe more so on the second group. Of course, some of these entry people go on to become the hand-holders, validators, reassurers and customer service champions.
SoCal is especially tough, with unemployment under 3% (and 18 year low) and the cost of living going up fast.
I’m curious to see what others have to say.
Ian BaldwinApr 2, 2018 at 6:32 am
Thanks Ron and all those below who have weighed in so far. This is a BIG topic and all thoughts are welcome.
Your separation of the types of labor needed is very helpful to an industry struggling with the challenge, and as you can see from others below, part of the answer is to fill some of those positions with early retirees and paying much more than three years ago.
But with regards the other labor needed, as Pat says below, we are all competing (along with a host of other industries) for the same dwindling pool of semi-skilled employees who can obviously shop around for the best pay and conditions.
I don’t think there is a long-term solution to this problem under the current model of full, hand-holding service unless it is a permanent recession – that’s the only time the current retail pay and conditions appeal to enough employees to get a good selection. And that is not a good business model!
John, below, makes it sound easy, pay what you know you should be paying, raise prices to cover it and enrich the shopping experience to justify those prices in the consumer’s mind – oh, is that all!
Thanks again Ron, I’ll be there soon to check on how it’s working at Rogers!
Tina BemisMar 28, 2018 at 10:54 pm
For years, we relied on high school students for about 1/3 of our labor hours, doing the “dirty work” that Ron mentioned above.
Sadly, the work ethic of most (not all) youth has drastically changed. The Entitlement Generation is alive and well in our state of Massachusetts. Even in the boonie suburbs where we are. So I pretty much gave up on them and have started hiring retired women (but men are fine, too!). They can do all but the strongest of lifting, can work circles around the kids, and as passionate gardeners they can expertly and confidently answer customer questions with no training. Often very well paid in their first career, they are not looking to earn huge salaries, they are looking to do something rewarding with their hobby. Make no mistake, you need to interview wisely to avoid those who always thought it would be fun to work with plants. But if you find some who have planted large areas of their own land, be it with veggies, flowers, or shrubs, you have found a passionate soul who understands hard, dirty work, and is willing to work for less than they deserve (as most of us do) as long as the job remains enjoyable.
Tina BemisMar 28, 2018 at 10:56 pm
Plus, they don’t mind being laid off at season’s end.
Art Vanden EndenMar 29, 2018 at 4:52 am
I concur 100% on moving to hire more second career adults.. I am trying to have each of our stores have a few on staff. College/high school students that are amazing and also required, but at most you get three or four years of employment. A great retired second career employee may give you 10 years of service or more. We (in Ontario) are dealing with a $2.40 increase in minimum wage, which besides being tough to handle, should be an incentive to get some retired workers back in the workforce.
Ian BaldwinApr 2, 2018 at 6:52 am
Art, nice to hear from you north of the border!
You are among many others facing a big, quick rise in labor rates, partly legislative, partly just supply and demand and I am seeing the more challenged GC owners actually dropping products or whole categories which are just too labor dependent.
For instance I know several companies who have moved larger fountains, statuary and containers from the retail area to their landscape division’s installation department (with the accompanying several weeks wait) for a more expensive and slower delivery and installation process. That alone will save significant labor challenges in retail though it doesn’t help the consumer and that’s the big question; will the consumer pay the true, going cost of all they expect from the garden retailer? Time will tell but either way, the 40 year old model has to change!
Thanks again Art, hope your Canadian spring is fab!
ArtApr 2, 2018 at 2:18 pm
Probabaly break a lot less fountains at the same time. Help the Gap
Ian BaldwinApr 2, 2018 at 6:40 am
Tina, thanks for taking time to share your thoughts.
I think you are on-to something with the early retirees who have real “dirty” gardening experience and the comfort of a well paid career behind them. I love the fact that you have search criteria that include evidence of them doing significant planting/maintenance in their own gardens – that will quickly sort them out from those who just “love to work with flowers and people in the fresh air” at your expense!
Best wishes to you and Ed for a great spring when it arrives!
Pat PearsallMar 29, 2018 at 6:06 am
Ron is right on the button. It remains easier to find knowledgeable, passionate gardeners who are willing to work for what we can afford. Because what they do and where they work is important. The current political climate has reduced low skill workers, new regulations and an agjbg workforce have tightened the market on drivers and too many younger folks want high wages and easy jobs. This leaves everyone competing for the same loader, forklift operator, landscape laborer or driver. Our unemployment rate is 2.4% in one market and about 2% in the other. We are still finding labor but no laborers and as a result have looked to reduce high labor low return activities.
One word of caution to everyone looking to load up on retirees….. people shop in places where they feel comfortable and they interact or see others like themselves. If all of your employees are in gheir 60’s you’ll have an uphill battle to attract millennials!
Ian BaldwinApr 2, 2018 at 7:06 am
Pat, I think you and I have had this conversation before – several times!
Opening another store where unemployment is 2% must be a real challenge.
Tina and Art (above) are correct about early retirees but so are you with the potential “image” problem of an older workforce appealing to a younger customer base.
I think that great service and after-sales success from any age group will work, but those GCs who follow this retiree model had better have some very good on-boarding and training programs. The last thing the under 35s need right now is a parental service attitude when they venture into the unknown of garden shopping.
Let’s keep this thread going and see how things look after spring, thanks again for taking the time. Happy eventual spring!
John HeatonMar 30, 2018 at 7:23 am
Labor is always a problem. If we pay enough they will come. After you fix up the entire retail experience you can raise prices to pay for it all. Hard to balance it all? Of course thats why we get the big bucks.
I believe deep down we know what needs to be done, we just need to do it.
One thing to remember when bring on new folks at higher prices is do not forget those already working for us. Nothing worse than bring on some one who gets paid more than another employee doing the same job very well with experiencer. Been there done that. Don’t let it happen to you;
Ian BaldwinApr 2, 2018 at 7:21 am
John, as usual you get straight to the core! You make it sound simple!
My questions after 32 years of traveling the N American GC industry is whether enough owners are prepared to risk the sort of investment necessary to elevate the retail experience as you suggest. Many are still playing catch-up from the 1990s. Throwing dollars at a problem has never been a popular garden center strategy this side of the Atlantic.
If it is more a question of improving the people experience rather than shiny new facilities, we will have to up our game in hiring, training, coaching and so on too, as well as pay the wages you correctly say we should be paying.
With these challenges in mind I go back to changing the entire model, Silent Service will be the default setting but with knowledgable, flexible, non-egotistical, passionate local employees on patrol to help when you need it! Less people, but making more money.
As for the “dirty” work as Ron and Tina mention above, we have to keep the cost of putting it on the shelf down and that needs some serious study.
Thnaks as always John, I hope the spring is arriving in Chicago for you!
Ed Laivo (Ed Able Solutions)Apr 3, 2018 at 9:19 am
Labor of course is the issue of the day, mostly fueled by political considerations. That I do not believe will be resolved soon
A question that I have is, in the era of the internet and on-line sales why is the independent retailer the last to include a internet store front and shopping cart? The answer is simple labor, retailers don’t have the labor to take orders, pull stock, pack and ship single items. Let alone have the inventory on hand to maintain a constant on-line presence.
This discussion has also included mention of the Millennial shopper and the need to attract them to the nursery. Ask Sears, Penney’s, Macys, K mart and numerous other clothing companies about how they have done attracting the Millennials. Touchy Feely for clothing was not immune to the ease of on-line shopping and in my opinion neither is the nursery industry.
The Millennial shopper is available almost to a fault on line 24/7. In studies I have read it is suggested that they are primed to be attracted to gardening. Health conscious, looking to enhance personal space, desiring to support local business and they have money.
Change has always been a fact of the nursery industry. Weather, economy, the cost of labor, the garden centers, the chains, the grocery stores, the move away from the grower/retailers, the introduction of 1000’s of new plants, the popularity swings, the wooden flats to 4in and 6 packs,…….. the tin to the plastic cans
The response to that change in our industry is often slow in coming. Most often forced.
I agree with Ian that changing the entire model is in line but not just at the retail level. I believe that it is a distribution issue that has to include a lesser dependence a the physical location and percentage move towards on-line sales in cooperation with wholesalers. I do believe that e commerce will not become over 50% of the business(at least not in my life time) but I do believe that it is where the emerging market shops and where you are likely to build your market share. Shifting a percentage of sales to on-line would in turn decrease the need for as much labor and add value to the older more experienced part-timers acting as information providers. it is difficult to discern age on the phone or on-line
I personally have been working this new model for some time and have made some great strides in presenting a new face to distribution which we are beginning to roll out.
Ian BaldwinApr 3, 2018 at 10:35 am
Ed, thanks so much for your thoughtful response, great stuff!
Two aspects on this:
First, we have several (large) indpendent retailer clients who were early adopters of on-line sales and quickly ran up to around a million dollars in sales annually. Then came one of those big growth steps. It seems that to play in the big league (i.e. like Amazon, Wayfair etc) they needed to invest almost that amount in software and administration. None of them were/are willing to do that as yet. To them the internet is still just a small profit center that rounds out the offer to their loyal customers, not necessarily to attract new younger ones. And, as you say, it also means very significant investment in operation and inventory to appear to be a big player.
Secondly, I analyse the National Gardening Survey each year (just finished this year’s and the results are very encouraging – out soon) and have watched the shopping behavior of the 18-34 year old consumers now for seven years. They are clearly buying more gardening products online than other age groups, but still not significantly in volume compared to the amount they buy from their favorite channel, the Independent Hardware Stores, followed by the Independent Garden Centers.
As you suspect they are choosing to visit local stores for on-site advice and validation (from a trustworthy human) of what they have learned online. Their hunger for information and first-time success should make the local independent garden center their store-of-choice IF, that channel (our channel!) turns itself around to sell the way the 18-34 year olds want to buy. The shopping experience is a VERY big part of the decision as to where they shop and that does include online information before they shop plus how-to information online during and after the visit.
It will all come down to the willingness of owners to invest (big) in change as you say.
IF this channel gets it right, it will be in the sweet spot for a whole generation, if not we will slowly decline with the boomers.
Thanks again for your thoughts!
Ed Laivo (Ed Able Solutions)Apr 3, 2018 at 12:51 pm
Ian, I believe the IRGC early adapters that ramped up to a million dollars in sales were few and far between. Unless they themselves were the grower and fulfillers it would be very questionable that any retailer could do that number on their own. My experience in the e commerce market is going on 18 years. There is an investment today but by no means does one have to be an Amazon or Wayfair which I might add are not a nurseries, rather they are a hub that is an outlet for many nurseries. A model that only rewards Amazon with recognition for the most part.
There are new opportunities that will be just what you said, ‘small profit centers’ for the independents to work with. In my opinion this is one of the best offerings for growth. The industries better use of internet advertising and social media is our marketing platform along with conventional advertising.
The unaccounted for millennials who are weary of sales interaction(also part of the Millennials character) are waiting on the sidelines to be influenced by our message and will make purchases from local retailers online. This will be the growth of this new profit center. The problem is too few are willing to cater to the way 18-35 year olds want to buy. So few are in the game.