State of the Foliage Industry

Economic hesitation with a slightly growing optimism is the reality for most businesses within the foliage sector of the floriculture industry.

Approximately 80 percent of the nation's houseplants are grown in Florida where the recession's effects are still prevalent, yet perhaps shrinking a bit. The foliage industry is fundamentally attached to most end consumers' disposable income, so there's a natural ebb and flow with the consumer spending index. As 2011 ends and 2012 begins, one could anticipate some acceleration in recovery as personal disposable income (PDI) across the nation rises.

"With folks having less discretionary money in tough times, quality has a better chance of selling. Something new needs to catch their eye or even a different presentation like Calathea lancifolia and Philodendron 'Pink Princess'- two exciting new industry plants," said Kenny Stewart, owner of Stewart's Greenhouse in Mt. Dora, Fla. "The cost of everything we purchase is going up, yet we're unable to increase our prices."

A weak market is joined by a consolidation among tropical foliage growers. Businesses have closed or merged. Others have reduced total foliage production.

Strategies among growers seeking to increase efficiency or market share include:

• Streamlining staff
• Increasing customer service or customer value
• Focusing on bottom-line costs while maintaining acceptable profit margins

Successful foliage growers are prioritizing between servicing their best-paying customers and seeking new business opportunities, which always runs the risk of lagging receivables.
 

Florida's economic impact
The Florida Nursery, Growers & Landscape Association (FNGLA) recently released economic impact figures covering all aspects of the large Florida market from jobs to sales output impacts. Conducted by the University of Florida, the data shows Florida's environmental horticulture industry (including foliage growers) is doing more with less. Florida's industry employs more than 244,000 people, down nearly 24 percent since the previous 2005 study. However, overall economic impact was slightly higher at $16.29 billion.

Florida is home to 118,000 acres of total nursery/foliage production. While 8,463 acres are in greenhouse production, many of South Florida's nurseries grow foliage and houseplant material. In the big picture, Florida agriculture is recognized either as the largest or second largest industry in the state, toggling the top position with tourism. And, nursery is the undisputed largest segment of Florida agriculture.
 

LEED help
As part of the effort to broadly expand the use of houseplants, a pilot credit in United States Green Building Council's LEED program has been developed. Exposure to the nation's green builders, where the industry has clearly communicated the indoor air quality benefits of houseplants, is leading to an increased use of innovation in builders' designs.

The result is more specification of interior green elements, such as living walls, by both professional interior designers and architects. If the pilot credit is successfully turned into a free-standing credit, the use of houseplants by builders and developers seeking green certifications such as LEED should skyrocket.

"We started our O2 for You campaign to educate and engage people on the benefits of houseplants for a healthier, more satisfying lifestyle, and we see this message picking up steam among mainstream America," said Jose Smith, chief executive of Costa Farms in Goulds, Fla. "The LEED certification opens up new markets to help drive demand and we're committed to advancing our industry so everyone benefits."

Foliage sales remain relatively flat over last 20 years

Moving business forward
For foliage growers to succeed, they must continue to change with the times.

"While we've always taken customer feedback seriously, we've talked to our customers and changed our product mix to focus on delivering what customers need, when they want it. Advanced spring sales are looking good," said Charlie Martin, owner of Harold B. Martin Inc. in Homestead, Fla.

Jennifer J. Nelis is Florida Nursery, Growers & Landscape Association director of public relations and marketing; www.fngla.org.