Reading the Mid-Spring Tea Leaves

May 13, 2016 12 Comments

For garden retailers in the warmer climate zones, the week after Mother’s Day is slowing down, over the peak, saying “now we have to work harder for it.” In most colder climates, Mother’s Day sales were down (this year at least), in some places seriously so, as May swapped weather with March. But in both climates it’s no time to relax (May everywhere pays wages for weeks ahead). It IS time though to read some mid-spring tea leaves in case you are staring at that still-massive inventory number….

What’s selling?

Succulents, succulents, and oh did I mention succulents? Any shape, color, size and style are flying off the shelf this year, and if you were smart enough to invest in added-value versions in planters and arrangements – even better. Aligned with that, I see all things naturelle with wood, stone and moss in those added-value lines. Small, simple and intense – which may reflect the influence of TV and other media on the under 35’s, with their minimalist homes and no-clutter styles. Surprisingly then is the strong demand for garden art and deco, maybe that’s the Boomers getting their own back. Another significant tea-leaf, off-the-charts demand for “Do It For Me” tree and shrub planting suggests that despite TV news and politicians, a lot of Americans feel good about spending the money on things they no longer want to do.

What’s not?

The DIFM surge might also be causing the fall in tree and shrub sales after a great year last year, but poor weather is also a factor. The earthy stone/wood trend above might also be the cause of reports that finally, after 20 years, sales of high color, high gloss, large ceramic pottery, is flattening out. Garden décor is hot but in a matte-finished, earthy or rusty way it seems.

Unsurprisingly, independents are reporting a drop in “hard goods” or garden supplies especially in controls or “chemicals” (as us old lags still call them). I think householders are using less in total anyway and most independents have lost the battle with the home centers for various reasons, the biggest of which is the (incorrect) perception that every single product on every single shelf must have a 50%+ gross margin. In fact, the home centers have used that victory to now present themselves as the one-stop shop for hard goods AND green goods, but that’s another blog for another day.

Serious tea-leaf analysis needed!

I talked to an owner who was questioning the strategy of his “chemical” category after he pulled a POS report (yes in mid-May!) showing that the 202 items sold in the “Insecticide” sub-class took 68 Stock Keeping Units (SKUs). Think about that: after the busiest weekend of the year, each SKU had only averaged 2.9 sold (out of, presumably, a case of 12). As he said, he was amazed at the sheer volume of SKUs to generate moderate sales. Food for thought and a validation for a comment from Jim Sullivan on my last post.

So, sharing is caring … leave a comment letting us know:  what are your mid-May surprises?

Photo Credit: Upscale, “stone” succulent arrangements made in-house at The Greenery (Taken by Ian)

  1. Bob Sickles
    May 13, 2016 at 7:12 pm

    Nice planters!
    That seems to me to be way too many skus of chemicals. I would apply the 80/20 rule but is there a clear winner and clear losers
    We eliminated neonics last year due to customer pressureand we have a request to remove Round-Up. Those are the winners! Maybe we should sell Aleve and Advil for folks to relieve those muscle aches after pulling all those weeds!
    PS I am rooting for Turlock Fruit Coop Melons this year. Hope there was enough rain.

    1. Ian Baldwin
      May 16, 2016 at 10:17 am

      Thanks Bob, I am assured that Turlock has enough water for your Melons this year! In that example business quoted about the SKU count, they applied the 80/20 rule but with 3 sizes each of synthetic and organic, then various application methods and then different dilution rates and bingo – SKU creep!

      They now have the full minimum range they think they should carry but spread across the customer count, even a “big” unit seller is only 8-10 items YTD. Again this points towards the company buyer being the first filter for the consumer – just buy what you think they need to do the job in your climate and soil and then tell them “this is what you need”. Good input, hope the NJ weather is improving for you, thanks!

  2. John Heaton
    May 14, 2016 at 7:11 am

    As always interesting reading. Mother’s day week end (Friday thru Sunday) was our busiest 3 days ever. Go 20 miles south and the sales were marginal. Just goes to show us how dependent we are on weather. Our sales also shows hard goods, especially chemicals being down while over all sales are up 7.7% YTD. Tree sales are up 35% while shrubs are up 10%. We have had several large sales of arborvitae for screening. It really surprises me how many customers are planting rows of arborvitae.

    We are doing a lot more “do it for me” Our planting are up 41% while our deliveries with no planting are down.

    Annual sales and even tropical sales have been very good while vegetable sales are down 8.2%. No idea why.

    1. Ian Baldwin
      May 16, 2016 at 10:26 am

      John, as always thanks for taking the time to share your experiences. I think Veggies are still nationally increasing but they are now in every hardware, supermarket, even gas station and sadly are now being used as a traffic driver by some. The DIFM case is well made, enough people now feel more financially comfortable to pay someone else to do it, even if the end-result is to hide themselves from their neighbors behind Arborvitae!

  3. Ron Vanderhoff
    May 16, 2016 at 7:52 pm

    Roger’s Gardens –
    Out in sunny Southern California the non-chemical attitude is well entrenched in the consumers’ persona and lifestyle. It will sound a bit like “California Righteousness”, but we have seen this for quite a while. It seams that many (not all) lifestyle trends get a start out here, incubate for a bit, then move around the county. Roger’s Gardens dropped our last synthetic fertilizers, herbicides, insecticides, snail baits and all others ten years ago now. We haven’t seen a Roundup, MiracleGro, Scott’s or Bayer label in a decade. We only suggest, sell and use organic or natural strategies.
    We saw this more, and still see it, as a marketing distinction and also as a leadership issue. The neonics debate, the Roundup debate, the invasive plant debate, the plastic bag debate and others are a non-event here. Even more so, we can say “we agree with you” and we can use these positions to our advantage in an offensive manner, not defensively. Not saying everyone should take this approach, but the world is changing and the next generation or two has a different perspective.
    I’m probably sermonizing a bit to much here for some, but shouldn’t our industry be the anti-box alternative. Shouldn’t we be selling nature, healthy environments, birds, butterflies, sunshine and everything that is good and healthy in the world? Seems like that’s what the marketplace wants, with more to come. We either lead or we don’t.
    The sermon is now complete and I will pass the offering tray 🙂


    1. Maureen Murphy
      May 16, 2016 at 9:27 pm

      Ron, we also are focused on non-toxic organic. It sure works for us.

      1. Ron Vanderhoff
        May 17, 2016 at 7:38 pm

        Phew! Thanks for the vote of confidence Maureen.

    2. Ian Baldwin
      May 18, 2016 at 7:27 am

      Ron, thanks for adding to the conversation here! I agree that in many independents, especially from N California to the Canadian border, the debate over “organics” or non-synthetics is over. This trend is even more noticeable among younger shoppers, reflecting a similar trend in food and restaurants. I respect Roger’s for taking the positition they have taken but “chemicals” of any brand are still a big category for many garden retailers. Independents in smaller markets find it difficult to turn away precious customers who want a certain brand or product. The subject is also a bit more complex than some people make out and I think there is a danger in calling all synthetics bad and all naturals, good. As an active gardener on 2.5 acres I can’t imagine life without Round Up! Do you carry any brand containing Glyphosate?

      I am sure we will continue to fine-tune products on both sides of the gondola. Things have certainly improved since I watered hoseplants with Metasystox in a closed greenhouse using an open diluter, withou gloves or mask!

  4. Maureen Murphy
    May 16, 2016 at 9:26 pm

    We could be selling lots more veg if we could get our orders filled. Lots of pressure on the system and things in short supply this year. Great sales year so far.

    1. Ian Baldwin
      May 18, 2016 at 7:29 am

      Maureen, glad to hear it! As we have discussed there is a long-term supply shortage of high quality color and veggies in the north west.

  5. Ernest Wertheim
    May 17, 2016 at 11:40 am

    Many thanks to all tjhose who have shared their expereinces with those of us who do the readfing
    Thanks to Ian for senign your comemnts to us,it is very valuable reading.

    1. Ian Baldwin
      May 18, 2016 at 7:34 am

      Thanks Ernest, it’s important we keep these conversations going now that there seems to be less face-to-face networking opportunities like the Mangement Clinic we all used to attend in “Lou’ville”.

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