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State of the Industry Address

We at Sweet Lane Wholesale feel that it is important to be informed of future pricing and inventory shortages within the industry. Below is a very well written and realistic view of our current and future industry stance due to the economic challenges we are facing and will be facing. Hopefully we can all plan in advance for some of these hurtles and start implementing different plant palettes. In these trying times, any and everything we can do to reduce financial losses is critical. Mixing up our plant palettes and having backup plans in the event of not being able to locate a specific plant are highly beneficial, plus, who likes to be caught flat footed. In the seasons to come, we will see prices increase and growers not replanting some species. The idea being to reduce the overages and get back to a steady industry course. This will equate to a few holes in grower inventories and an increase in plant costs.

Why Tree Prices Will Increase

John H. Barbour, President, Bold Spring Nursery
(Reprinted with permission from author)

Usually price increases are a sore topic. In our current economic climate, cost cutting has become a way of life as businesses fight to conserve cash and preserve margins. The unwelcome news of a price increase from a supplier is usually the last thing a buyer wants to hear. The ornamental tree business has been no different. Growers have suffered a crushing over-supply of trees which was, in fact, developing 6 -7 years ago, but was masked by the frenetic pace of construction through the middle part of the decade. When the bubble burst in 2007-2008 the demand for trees was reduced dramatically, beyond what few of us have ever witnessed. Since that time, growers, desperate to maintain a market share, have reacted by cutting prices for each of the last 3 years to the point where prices, on some items, have reached 30-year lows.

Unlike many businesses, tree growers cannot simply downsize their company to a scale that matches their sales. Existing inventory requires upkeep and that costs money. Like everyone else, growers have aggressively cut costs to try to staunch the negative flow of cash. That is a tall order in a world where the costs of raw materials such as burlap, diesel, and plastic have only increased. So, in many cases, fertilizer, pesticides, pruning, and staking have gone by the board. The results of excessive cost cutting are evident in the marketplace this year and many growers are simply not capable of supplying trees of adequate quality. For most growers, even the cost of culling bad trees is daunting when cash is tight and so the trees sit around, on display in the fields or, in the case of containers, growing increasingly pot-bound.

The other major area of cost cutting has been a sharp decrease in tree-planting in nurseries. Many cash conscious growers have realized that if they cannot afford to maintain what they have, then there is little point in putting more trees in the ground. As a result, tree planting has declined 70-80% over this period. This reduction occurred progressively: first by about 20% in 2008-2009 and then an additional 30-40% in each of the two following years. This trend has only just begun to become evident, with many smaller-sized trees and evergreens becoming scarce this spring. Over the next two years the breadth of shortages will increase dramatically and progressively, as more gaps appear while the old inventory outgrows the market, becomes ruined from neglect, is sawed down to increase spacing, or grubbed out entirely to prepare fields for re-planting.

Growers are watching carefully to see which items are selling out and they will raise prices whenever market conditions allow. This is not a matter of greed as much as survival. Most nurseries are just hanging on and absorbing losses, if they are even doing that. We are all watching while prominent nurseries fail, unable to continue in an economic meltdown that was nearly impossible to predict.

The shock waves from the sub-prime melt-down will continue to be felt, but will soon be felt in different ways. The crash of demand will be followed by a crash in supply caused by a reduction in the number of nurseries that have been willing and able to continue to risk investment in the planting and maintenance of quality inventory these last three years. And just as the construction boom masked the over-supply of trees 5-6 years ago, the construction bust is masking the currently developing shortage. When we experience even a modest resumption in new construction, the shortages will be difficult to manage.

It is important for businesses to educate their customers for what is coming. There is a special challenge for those who are bidding projects that are further out. There is a shocking gap between the desperate pricing of 2010-11, and the prices of, even, the over-supplied market of 2007. But when scarcities become prevalent, prices will return to their former levels, and eventually go higher still. That market of shortages may be much closer than you realize. Buyers should be prepared for price increases in fall 2011 and very large increases in 2012 and 2013.

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Sweet Lane Wholesale Nursery History

The history of Sweet Lane Wholesale Nursery will be posted soon.

Tobias Kane - Marketing And Sales Manager

Toby is the Marketing and Sales Manager at Sweet Lane. He was born and raised in Chicago with a healthy passion for the outdoors. This led him to Colorado where he graduated from the University of Denver and became a part of the green trade. He has been enthusiastically involved in the horticulture industry since 2000.  Having worked in retail, re-wholesale, and growing nurseries along the Colorado Front Range, he has a diverse background of professional experience from nursery settings to operations and management. Spending time with friends and family and indulging in music and food are ways Toby enjoys his time away from his passion.

Bruce - Operations Manager

Bruce handles operations management for the nursery. Bruce was born and raised on a Christmas tree farm in the Santa Cruz Mountains. He graduated from Cal Poly San Luis Obispo in horticulture concentrating in nursery management. This is his 30th year in wholesale nursery management. Bruce recently moved from Cotati to a home in west Petaluma where he has lots of room in his yard to work on garden projects. He and his wife Paula enjoy hiking in the Sierra Nevada Mountains where they are often joined by their grown children Robert and Audrey. He is excited about the opportunity to provide great plants to customers at Sweet Lane Nursery.

Office Staff

Terri Toso- Sales Representative

Terri has 12 years sales experience in the wholesale nursery industry. She worked for Marquard Gardens Wholesale Nursery, a culinary and medicinal herb grower, for 7 years. In 2000, she started her own business, Napa Valley Botanicals, a small organic medicinal herb farm, herb nursery, and botanical product company. In 2006, she started helping out at Sweet Lane as a sales rep and currently works 3 days a week. Terri has an herbalist certificate from the California School of Herbal Studies, the oldest herb school in the United States. She also worked as a native plant propagator for a restoration nursery in Windsor, CA.

Terri loves being around plants and wildlife, and enjoys camping, hiking, cooking, traveling, and reading. She lives with her husband of 26 years, and her kitty, Lucy.

Delivery Department

Yard Staff

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