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Cashing in on the greenhouse effect.


In the face of environmental concerns, pesticide use and the Greenhouse Effect, Manitoba's nursery business remains strong and healthy.

Manitoba's nursery and greenhouse business, preparing for spring sales, is facing the environmental movement, concern about pesticide sales and use, the Greenhouse Effect and global warming, plus the chance that the prairie drought will continue. Nevertheless, the industry remains healthy, if a bit precarious. This is an industry that doesn't worry about quarterly or even yearly profits. Here, success is measured in decades and generations.

Selling plants and garden gadgets should be a pushover. In spring, customers jostle one another at garden shops to get at the stock. Even in winter during blizzards the real garden junkies leaf through seed catalogues. Summer is the time to buy bug sprays; fall, the time to get a new composter. In this industry, demand for product seems insatiable.

From the point of view of greenhouse managers and nurserymen, the gardening business should be almost perfect. The market is never saturated; there is an endless flow of new seeds, plant types, gadgets and garden accessories. According to Jan Pedersen, retail manager of Shelmerdine Nurseries & Garden Centre Ltd., lawn and garden care is the most popular leisure activity in the country.

"If you count lawnmowing, snowclearing, as well as landscaping, planting, tree-pruning and all that, no other leisure activity takes as much time or involves as much money," he explains.

The greenhouse business should, therefore, be robustly profitable. Where else can you plant an almost cost-free seed and later, sell a plant or tree for hundreds of dollars?

Experienced nurserymen know, however, that money does not grow on their trees. Explains Ernie Kackenhoff, president of Kackenhoff Nurseries, "You need to start raising some of your tree stock a decade before you plan to sell it. A tree can take that long to grow three-and-a-half inches in diameter. So you have to plan your inventory as much as a decade in advance."

The capital requirements to develop product for sale as much as 10 years away are phenomenal, especially if funds are borrowed. Huge amounts of land are needed to grow trees and shrubs; add the threats of insects, fire, adverse weather and changing marketing preferences in trees and shrubs and one comes to the question of why any sane businessman would want to operate a nursery.

Today, nurseries face new risks. Environmental concerns are producing consumer resistance to chemical insecticides. A movement to curb destruction of the rain forests is affecting the North American tree business. And the global warming trend, produced by the burning of fossil fuels, is profoundly effecting the nursery industry.

According to Pedersen, environmental problems are really opportunities in disguise. "We can give people the traditional chemical bug sprays, or we can sell them materials that are not harmful to the environment but take more labor to apply than traditional toxic material. We let the consumer make the choice.

"Concern for the rain forest and global warming actually gives us a chance to increase our sales. We can sell more trees as wind and sun screens that will reduce energy demands of buildings," he adds. "And we can sell them as natural life forms that, like all photosynthesizing plants, consume carbon dioxide, the direct, though not ultimate, cause of the warming trend."

Ten years ago, Manitoba nurserymen planned well enough to cover themselves for such problems. Today, they're busy expanding for more business to come. The industry is alive and well, if not setting profit records, despite the traditional problems of a short growing season, bugs and erratic weather. And, with imaginative marketing, it is turning environmental problems into new sales.
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Title Annotation:Manitoba's nursery industry
Author:Allentuck, Andrew
Publication:Manitoba Business
Date:May 1, 1990
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