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Group Title: Economic information report
Title: Business analysis of foliage plant nurseries in Central and South Florida
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 Material Information
Title: Business analysis of foliage plant nurseries in Central and South Florida
Series Title: Economic information report
Alternate Title: Foliage plant nurseries in Central and South Florida
Physical Description: v. : ; 28 cm.
Language: English
Creator: University of Florida -- Food and Resource Economics Dept
Florida Cooperative Extension Service
Publisher: Food & Resource Economics Dept., Agricultural Experiment Stations and Cooperative Extension Service, University of Florida
Place of Publication: Gainesville
Publication Date: 1989
Frequency: annual
regular
 Subjects
Subject: Foliage plant industry -- Economic aspects -- Periodicals -- Florida   ( lcsh )
Nurseries (Horticulture) -- Economic aspects -- Periodicals -- Florida   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
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General Note: Description based on 1989; title from cover.
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oclc - 23021216
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 Related Items
Preceded by: Business analysis of foliage plant nurseries in Central Florida
Preceded by: Business analysis of foliage plant nurseries in South Florida
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Full Text
Mr of
March 1991


UvERSTY OF FLORIDA LIR p'"
Circular 953


Business Analysis of

Foliage Plant Nurseries in

Central and South Florida, 1989


Alan Hodges
DeArmand Hull


Florida Cooperative Extension Service / Institute of Food and Agricultural Sciences
University of Florida, Gainesville / John T. Woeste, Dean for Extension












BUSINESS ANALYSIS OF FOLIAGE PLANT NURSERIES IN CENTRAL AND SOUTH FLORIDA, 1989

Alan Hodges and DeArmand Hull


Food & Resource Economics Department
Institute of Food & Agricultural Sciences
University of Florida
Gainesville, FL


December 1990















ACKNOWLEDGEMENTS
This report was made possible by the cooperating foliage nursery operators who made available their
production and accounting records on a confidential basis for analysis and averaging. Assistance was provided
by University of Florida Extension Ornamental Horticulture Agents Bruce Barmby, Gerri Cashion, Cathy Neal,
Loretta Hodyss, and Bill Schall. Special thanks are due to Dr. J. Robert Strain, Professor Emeritus, who
developed the Nursery Business Analysis in its present form, and who retired in June, 1990. Any errors in the
analyses or in the interpretation of the information presented herein, however, are the sole responsibility of the
authors.






Central and South Florida Foliage Nurseries, 1989


TABLE OF CONTENTS


Pa
ACKNOWLEDGEMENTS ..............
INTRODUCTION ...................
PROCEDURES .....................
RESULTS .........................
Value of Production .................
Anual sales ....................
Plant inventory change .............
Monthly sales ...................
Productive Resources ...............
Land Resources .................
Labor Resources .................
Capital Resources ................
Resource Use Indicators .............
Land Use ......................
Space Productivity ..............
Inventory Turnover .............
Labor Use ......................
Labor Productivity .............
Labor Intensity ................
Capital Use .....................
Capital turnover ..............
Capital managed per person ......
Capital managed per acre ........
Costs of Production .................
Salaries and wages .............
Production supplies ............
Other production costs ..........
Administrative and overhead ......
Total cash costs ...............
Non cash costs ................
Cost Efficiency ....................
Cost Per Square Foot of Growing Space
Cost Per Square Foot of Propagating &
Finishing Space ................
Cost Per Dollar Value of Production ..
Cost Per Dollar of Sales ...........
Income Summary ..................
Total Gain .....................
Net Nursery Income .............
Return to Capital ................
Net Profit Margin ..............
Rate of return on capital ........
Financial Position ..................
Assets ........................
Liabilities ......................
Net W north .....................
Financial Leverage .................
Return on Net Worth ................
SUMMARY ........................
Key Factors Relating to Profitability .....


Page
CONCLUDING COMMENTS ............ 14
The Florida Nursery Business Analysis
Program ...................... 14


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APPENDIX ........................
Definitions ................. ......
Notes on Calculations ...............
List of Appendix Tables .............
Appendix Tables ...................

LIST OF FIGURES
Figure P
1 Monthly Sales ....................
2a Distribution of Managed Capital, Central Fla
2b Distribution of Managed Capital, South Fla.
3 Space Productivity ..................
4 Labor Productivity ..................
5 Labor Intensity ....................
6 Capital Turnover ..................
7 Capital Managed Per Person ..........
8 Capital Managed Per Acre ...........
9a Distribution of Costs of Production,
Central Florida Nurseries ...........
9b Distribution of Costs of Production,
South Florida Nurseries ...........
10 Costs Per Square Foot of Growing Space .
11 Costs Per Dollar of Production ........
12 Net Profit Margin ..................
13 Rate of Return to Capital.............
14 Assets and Liabilities ................
15 Leverage Factor ...................


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LIST OF TABLES
Table Page
1 Value of Production and Productive Resources 3
2 Costs of Production by Expense Category 9
3 Income Summary .................. 12
4 Summary of Profitable Firms .......... 15






BUSINESS ANALYSIS OF FOLIAGE NURSERIES IN CENTRAL AND SOUTH FLORIDA, 1989
Alan Hodges and DeArmand Hull'


INTRODUCTION
This report presents information on sales, costs,
returns and production efficiency for 51 wholesale
foliage plant nurseries in Central and South Florida
for 1989. These results are part of the University of
Florida's ongoing Nursery Business Analysis Program.
This information is intended for:
1) Nursery managers--to use physical and
economic measures for evaluating the efficiency of
individual nurseries and for making more informed
management decisions;
2) Allied trades professionals--to estimate input
requirements and revenue potential for wholesale
ornamental nurseries;
3) Industry investors--to have guidelines for
average business performance;
4) Extension educators--to use for conducting
educational programs with nursery operators;
5) Researchers--to support research activities for
the ornamental horticulture industry.


PROCEDURES
The information presented in this report is based
on confidential production and accounting records
provided by nursery operators who participated in the
program voluntarily. This is not a statistically
representative sample of firms, but is believed to be
biased toward better-managed foliage firms. Nursery
operators who provided data received an analysis for
their own operation, which contained similar
information as presented in this report.

Data were collected for the 1989 fiscal year. In
most cases this was for the calendar year January to
December 1989. However, in a few cases data for
fiscal years ending after July 1, 1988, and before July
1, 1990, were included as 1989 data.

The Nursery Business Analysis is a economic-
oriented appraisal rather than a financial or tax
accounting appraisal. As such, it attempts to provide
an economic valuation for all resources and
production activities, whether or not they have an
actual monetary value for any particular firm. For
example, in firms that did not report a salary for its


managerss, an estimate of their time value was made
(based on the their experience and other
opportunities for income) in order to provide an
economic valuation for management, which is a
critical input for any business. Similarly, an interest
charge for the total owned investment was included as
a non-cash cost, calculated at the rate of 12 percent
per year, regardless of any interest expense paid by
individual firms. This provided a comparable basis for
interest costs across all firms.

Capital investments and leased capital assets were
an important part of the analysis. In the case of sole
proprietorships and closely held corporations (sub-
chapter S, or "family" businesses), investments in land
were valued at the original purchase price;
investments in buildings, improvements, machinery,
and equipment reflected their depreciated book value
and debt held by family members was not included
among liabilities. In the case of regular corporations,
land, buildings, and equipment were evaluated at
current market value. The majority of firms were of
the former type, so investments in land often did not
represent their current value, especially for older
firms, because of greatly increased land values.

Plant inventory is a critical element of the
wholesale nursery business. Changes in plant
inventory levels during a year must be accounted for
in conjunction with annual sales in order to assess
total production of a firm. In this analysis, emphasis
is placed upon "value of production," defined as sales
plus change in plant inventory value, as a measure of
productive capacity. Plant inventory was included
among owned capital investments. Inventory was
averaged between year beginning and year end values,
at wholesale price, but discounted in proportion to
the percentage of completion. In the absence of
detailed inventory records, plant inventory was
evaluated at 50 percent of the average finished
wholesale value for all plants in production at the
beginning and end of the year.

Records were separately compiled and analyzed
for two regions within the state: Central and South.
The Central Florida region included Hardee, Lake,
Marion, Manatee, Orange, and Seminole counties; the
South Florida region included Dade, Broward, and


1 Alan Hodges is an Economic Analyst, IFAS, Food & Resource Economics Dept., and DeArmand Hull is a
Commercial Ornamentals Extension Agent, Dade County, University of Florida.









Palm Beach counties. These two regions are
recognized for their distinct production systems and
product types: Central Florida foliage firms tend to
produce plants in small pot sizes (3 to 6 inches), using
fully weatherized and heated greenhouse structures,
whereas South Florida firms produce larger plants in
open-air shadehouses. In previous years, results for
the two regions and for the Dade County firms within
South Florida were reported in separate publications.
However, results are here consolidated so that
regional comparisons may be made. Average size of
businesses differed substantially between the two
regional groups sampled, but these differences
probably reflect a great deal of sampling error, and
should not be taken as any indication of average firm
size.

In addition to the regional groupings, data were
analyzed for subgroups of large and small firms, and
highly profitable firms, so that an appreciation can be
gained for effects of scale, and for the ingredients of
successful businesses. Small firms were defined as
having annual sales less than $200 thousand. Large
firms had annual sales greater than $1 million in
South Florida, and greater than $500 thousand in
Central Florida. Highly profitable firms were defined
as having rates of return on capital investments
greater than 15%.

The results reported are weighted averages for
firms in each group. In other words, basic
information on sales, expenses, etc. was first averaged,
then analyzed as though for a single "average" firm.
This procedure provides results that are weighted for
the overall size of the firms involved. Also, for some
measures, results are given for the "highest rates" and
"lowest rates," representing averages for the highest
or lowest third of firms for that particular measure.

Further information on definitions and calculations
are given in the Appendices. Detailed results are also
provided in Appendix Tables.

RESULTS
Complete and usable records were received from
51 foliage firms: 20 in the Central region, and 31 in
the South region, with 28 from Dade County.
Numbers of firms represented for each grouping of
large and small, and most profitable firms are
indicated in Table 1 along with basic information on
business volume and scale of production operations.


Central and South Florida Foliage Nurseries, 1989

Value of Production

Annual sales
Figures reported here represent only plants
produced by the participating nursery firms. Sales of
plants purchased for immediate resale, or "brokered,"
were deducted from total sales to give net value of
"own" plant sales, which averaged $486 thousand for
Central Florida firms, and $1.221 million for South
Florida nurseries (Table 1). The largest 6 firms in
Central Florida had sales averaging $1.026 million,
and the largest 7 firms in South Florida had average
sales of $4.045 million. The smallest 5 firms in
Central Florida had sales averaging $100 thousand,
and the smallest 10 firms in South Florida had
average sales of $133 thousand.

Plant Inventory Change
Changes in plant inventory levels were accounted
for to evaluate total production, in addition to sales.
Table 1 shows average plant inventory changes, for
Central and South Florida foliage firms, and largest,
and smallest nursery subgroups. Average plant
inventory change was positive for South Florida firms
($57 thousand), meaning that total value of
production exceeded annual sales. Central Florida
firms had a decrease in average plant inventory
(-$14 thousand), thus giving a total value of
production less than annual sales. Largest and
smallest firms in the two respective regions showed
opposing patterns of inventory change, although not
large in magnitude compared to sales levels.







Central and South Florida Foliage Nurseries, 1989


Table 1--Value of Production and Productive Resources, Central and South Florida Nurseries, 1989.

Units -------------Central Florida------------ ------------South Florida----------
All Largest Smallest Most Profit All Largest Smallest Most Profit
20 Firms 6 Firms 5 Firms 4 Firms 31 firms 7 firms 10 firms 9 firms
Sales Volume Range . $ all >500,000 <200,000 NA all >1,000,000 <200,000 NA
Value of Own Plants Sold $ 486,185 1,025,511 100,494 438,127 1,221,002 4,045,296 132,695 771,082
Change in Inventory Value $ (13,574) 7,324 (9,020) (292) 56,900 (79,336) 8,173 293,767
Total Value of Production $ 472,611 1,032,835 91,474 437,835 1,277,902 3,965,961 140,868 1,064,849
Total Growing Area . sq.ft. 99,132 220,037 31,891 47,360 1,195,519 4,420,615 123,536 369,630
Full-Time Equiv. Workers number 12.64 28.79 2.94 8.61 28.76 96.32 3.87 16.69
Total Owned Capital. . $ 464,648 823,328 193,258 273,020 1,586,989 4,742,383 242,826 1,205,480
Total Leased Capital .. $ 43,178 15,833 0 1,000 154,619 434,199 62,850 152,255
Total Managed Capital. $ 507,826 839,161 193,258 274,020 1,741,608 5,176,582 305,676 1,357,735



Monthly sales Do I l ars CthousandsD
Figure 1 shows the
average monthly pattern of $140 ................... ...................... ..
sales for all nurseries in
Central and South Florida. $20......................................................
The general pattern for both
regions was highest sales in $100 .. ..................... ............ ...........
late spring to early summer
months, with local peaks i$90 .. ...........
January and October, and a
gradual decline in sales $60
throughout the second half of
the year. For Central Florida, $40 -...................
peak sales occurred during the
March through June period, $20
whereas for South Florida So
sales peaked during April $o
sales peaked during Apri Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
through July. Sales for these
peak four month periods Month
accounted for 37.5% and
Central Florida South Florida
42.9% of the year's total Centra Fora out
S t Sae for Figure 1--Monthly sales for all firms sampled in Central and South Florida
sales, respectively. Sales for
the highest month (May) regions, 1989. Monthly figures include brokered sales.
were 2.3 times greater than
the lowest month (December) for Central Florida; in South Florida, sales for the highest month (July) were 1.45
times greater than the lowest month. Thus, Central Florida firms had somewhat greater monthly variation in sales
activity. Monthly sales for large and small firms showed consistent patterns for both regions, with largest firms
having slightly more seasonal sales, and smallest firms somewhat less seasonality.










Productive Resources: Land, Labor and Capital

Land Resources
Space available for growing plants was measured
as an average of square footage of net usable growing
area in use at the beginning and end of the year. Net
usable growing area included only space within beds
and benches, not aisles, driveways, or other service
areas. As shown in Table 1, growing space averaged
99 thousand square feet (2.3 acres) for Central
Florida firms, and 1.196 million square feet (27.5
acres) for South Florida firms. A portion of growing
space was dedicated to maintenance of stock plants
for production of starter plant material.
The proportion of space devoted to stock plants
versus growing plants for sales relates to
specialization in production and costs for starter plant
material (see section on "Costs of Production"). South
Florida firms generally had a higher share of growing
space dedicated to stock plants than did Central
Florida firms (37% vs. 12%). Large firms in both
regions had slightly greater percentages of stock plant
space (14% and 40%), while small firms in Central
Florida used almost no space for stock plants (0.8%).
Space used for growing plants for salable products,
termed "propagating and finishing space," excludes
stock plant space.

Labor Resources
Labor was measured in terms of full-time
equivalent persons, including office and management
personnel. In most cases, this was calculated by
dividing total labor hours by 2,080 hours per man-year
(52 weeks at 40 hours per week). Average number of
full-time equivalent (FTE) persons was 12.6 for
Central Florida nurseries, and 28.8 for South Florida
firms (Table 1). The largest firms employed 28.8
FTE in Central Florida and 96.3 FTE in South
Florida while the smallest firms employed 2.9 FTE in
Central Florida and 3.9 FTE in South Florida.

Capital Resources
All forms of owned and leased assets, including
land, buildings, equipment, plant inventory, accounts
receivable and cash on hand represent capital
resources for nursery production. Owned capital in
buildings, improvements and equipment were assessed
at current value: original cost less accumulated
depreciation. Total capital owned averaged $465
thousand for Central Florida nurseries and $1.587
million for the South Florida firms (Table 1). The


Central and South Florida Foliage Nurseries, 1989

thousand in Central Florida, and $4.742 million in
South Florida. The smallest firms had average
owned capital of $193 thousand in Central Florida
and $243 thousand in South Florida. Additional
capital managed in the form of leased assets averaged
$43 thousand for Central Florida firms and $155
thousand for South Florida nurseries, giving total
capital managed of $508 thousand, and $1.742 million,
respectively

Distribution of Managed Capital--among land,
buildings, equipment and other assets, is indicated in
Figures 2a and 2b, for all Central and South Florida
firms, respectively.


Plants
32.1%








Land
12.44%
Mach/Equip.
6.5%


Accounts Rec.
S11..

Supp I ies/Cash
10.3%






Bul Id/ Install.
26.9%


Figure 2a--Distribution of managed
Florida foliage nurseries, 1989.


capital, Central


Growing plants represented the largest share of
capital managed in both regions, but was greater for
South Florida firms (44%) than for Central Florida
nurseries (32%). Following in order of importance
for Central Florida firms were buildings and
installations (27%), land (12%), accounts receivable
(12%), supplies and cash on hand (11%), and
machinery and equipment (7%) (see Appendix Tables
4a and 4b). For South Florida firms, the order was
different, with land being the second highest category
of managed capital (21%), followed by accounts
receivable (16%), buildings (11%), equipment (4%),
and supplies and cash on hand (4%). Small firms in
Central Florida had a much greater proportion of
managed capital in buildings (48%), while small firms
in South Florida had a higher share (45%) in land.


largest firms had average owned capital of $823







Central and South Florida Foliage Nurseries, 1989


Plants
43.9%


Supplies/Cash
3.9%

ul Id/ Instal.
1 10.9%


Mach/Equ ip
4.2%


Land
21.4%


I
Figure 2b--Distribution of managed capital, South
Florida foliage nurseries, 1989.


Resource Use Indicators

Space Use
Space productivity was measured as value of
production (annual sales plus inventory change) per
square foot of growing space. As shown in Figure 3,
value of production per square foot for Central
Florida firms ($4.77) was more than 4 times greater
than for South Florida firms ($1.07) because of the
more intensive production systems. Large firms in
South Florida had even lower space productivity
($0.90/sq.ft.), while smaller firms were slightly above
average ($1.14/sq.ft.). In contrast, small firms in
Central Fllorida had lower production per square foot
($2.87) than the average, and large firms had nearly
the same as the average ($4.69/sq.ft.). The third of
sampled firms with the highest space productivity
averaged $9.61 per square foot in Central Florida and
$5.04 per sq.ft. in South Florida.
The most profitable firms had space productivities
of $9.24 per square foot in Central Florida and $2.88
per square foot in South Florida, or about twice as
great as the overall averages, indicating the
importance of space productivity for profitable
nursery operations. Low space productivity may result
from several causes: overmature plants, high vacant
space, slow plant growth, and disease and quality
problems that reduce yields of salable plants. In
addition, nursery layout and fertilizing and growing
techniques can affect production time and space
requirements.


Figure 3--Space productivity. Value of production
(sales plus inventory change) per square foot of
finishing and propagating space (excludes stock plant
space).


Space productivity on the basis of growing acreage
averaged $208 thousand per acre for Central Florida
firms, and $47 thousand per acre for South Florida
nurseries (Appendix Tables 2a and 2b). Value of
production per square foot on the basis of
propagating and finishing space (excludes stock plant
space) was, of course, greater than for total growing
space. For South Florida firms, this difference ($1.70
vs. $1.02 per sq.ft.) was proportionately greater than
for Central Florida firms ($5.44 vs. $4.90 per sq.ft.)
because of their higher percentage of stock plant
space. Detailed results for this measure are given in
Appendix Tables 2a and 2b.

Plant inventory turnover is another indicator of
space productivity. Inventory turnover expresses the
rate at which inventory is replaced on an ongoing
basis, and is calculated as annual sales divided by
average inventory value. Plant inventory turnover
averaged 2.98, or 298 percent, for Central Florida
firms, and 1.60, or 160 percent, for South Florida
firms (Appendix Tables 4a and 4b). In other words
the number of "crops" per year averaged almost 3 for
Central Florida firms and 1.6 for South Florida firms.
This is another indication of the greater production
intensity of Central Florida foliage nurseries.
However, the pattern of results for large vs. small and
most profitable firms differs from those for
production per square foot because the inventory


Central FICloid






5outn FlIrida


A bll 1l'
mom

Hfawt raum
ME Miet woritL


3o0 2 s4 B 5s8 510 132
Do lars Per Square Foot







6


turnover measure is complicated by inventory values.
Large firms in both regions had higher average
inventory turnover rates (3.3 in Central Florida, 1.8 in
South Florida) and small firms had lower rates (2.0
and 1.4, respectively). Highly profitable firms in
Central Florida had turnover rates (4.1) nearly as
great as the highest rates (4.4), but highly profitable
firms in South Florida had turnover rates (1.1) near
the lowest rates (0.8). This paradox for highly
profitable South Florida firms may be explained by
the relatively high inventory levels required for some
profitable long-term crops such as bromeliads and
orchids, which reduce inventory turnover rates.

Labor Use
Labor productivity was measured in terms of value
of production per full-time equivalent worker (2080
hr/year). Figure 4 shows that labor productivity was
somewhat higher for South Florida nurseries ($44
thousand/FTE) than for Central Florida firms ($37
thousand/FTE). In both regions, large and small
firms had below-average labor productivity. Highest
rates of labor productivity were substantially greater
for South Florida firms ($81 thousand/FTE) than for
Central Florida firms ($54 thousand/FTE), but lowest
rates were nearly the same regionally ($29 thousand
and $26 thousand per FTE, respectively).
Dollars Per Worker (FTE) (Thousands)
$100 I I


$40


S20


Figure 4--Labor productivity. Value of production
per fulltime equivalent person (2,080 man-hours per
year).
Highly profitable firms in both regions had labor
productivities approximately 50% above average ($51
thousand for Central Florida, $64 thousand for South
Florida), indicating the importance of labor
productivity for profitable operations. Variation in
labor productivity can result from differences in


Central and South Florida Foliage Nurseries, 1989

investment in labor saving capital items, labor
management practices, or other practices affecting
crop turnover.

Labor intensity was evaluated in terms of
production area per person or FTE persons per acre
of growing area. Total growing space per full-time
equivalent averaged 7.8 thousand square feet (0.18
acres) for Central Florida nurseries, 41.6 thousand
square feet (0.95 acres) for South Florida firms
(Appendix Tables 3a and 3b). Expressed another
way, figure 5 shows the number of FTE persons per
acre of growing space averaged 5.55 for Central
Floirda and 1.05 for South Florida. Large firms had
slightly higher labor intensity in Central Florida (5.7
FTE/A), but lower intensity in South Florida (0.95
FTE/A). Small firms showed the opposite pattern,
with below-average intensity (4.0 FTE/A) in Central
Florida and above-average intensity (1.4 FTE/A) in
South Florida. Highly profitable firms in both regions
had significantly greater labor intensity: 7.9 FTE per
acre in Central Florida, and 2.0 FTE per acre in
South Florida.


Persons CFTE) Per Acre Growing Area


0 ............................ .......................................





4.00 -.". . Most profItable

2.00 ........................-.... A. i



0.00
Central Florlid South Florida

Figure 5--Laborintensity. Average full-timeequivalent
persons (FTE) per acre of growing area.

Capital Use
Capital Turnover is an indicator analogous to
inventory turnover, except that it expresses the ratio
of annual sales to value of owned capital. Results for
this measure generally paralleled those for inventory
turnover. As shown in figure 6, capital turnover
averaged 0.96 for Central Florida nurseries, and 0.70
for South Florida firms. Thus, both regions had


annual sales less than capital owned. Also in both
regions, large firms had above-average capital
turnover rates, and small firms had below-average


Ei All fir-
S Largmt

M Highest rates
SLomest rates
Moet crofltable


South Florida


Central Florfda


*40<







Central and South Florida Foliage Nurseries, 1989

rates, especially in Central Florida. Highest rates
were 1.59 and 1.08, while lowest rates were 0.61 and
0.43 for Central and South Florida regions,
respectively. Most profitable firms in Central Florida
had inventory turnover even greater than the highest
rates (1.61), while those in South Florida had below-
average turnover (0.64)
Annual ISales/Capital Owned
2.00


1.00



0.50



0.00


Figure 6--Capital turnover. Ratio of annual sales to
owned capital. Average for most profitable firms in
Cen.Fla. were higher than for the "highest" rates due
to a smaller number of firms.
In general, higher capital turnover is desirable,
indicating greater sales per dollar of investment.
Problems that lower turnover rate include many of
those already mentioned that lower production rate,
and therefore lower sales volume for a given nursery
investment. Low capital turnover is particularly
common in new firms and in rapidly expanding firms.
Excessive investments in land, labor-saving machinery
and equipment also tend to lower capital turnover.

Capital Managed Per Person is an indicator for
balancing capital and labor resources, calculated as
total capital managed divided by employment (FTE).
As shown in Figure 7, capital managed per FTE was
generally lower for Central Florida firms ($40
thousand/FTE) than for South Florida nurseries ($61
thousand/FTE). Large firms in both regions had
below-average capital managed per person: $29
thousand in Central Florida and $54 thousand in
South Florida. Smallest firms, on the other hand, had
above-average capital managed per person: $66
thousand in Central Florida, $79 thousand in South
Florida. Highest rates averaged $118 thousand per
person in Central Florida, and $112 thousand per
person in South Florida, while lowest rates averaged
$22 thousand and $41 thousand, respectively. The


Dollars Per Enployee CFTE) (Thousands)
$140
S118
$120 -$12



so -1 .. Z2- Lrgum
Sa- aml lst
61 M Hlghest rates

mm Mwt p-olItablI
$40
432
S4OI' 2!


Central Florra


All flrm
Larg"t
Isa I lot
HIlghet rate
Lomat reta
Moat proftable


South Florida


m
ma
mn


Figure 7--Capital managed per worker (FTE).
Calculated as capital managed (owned plus leased)
divided by fulltime equivalent employees.




most profitable firms in Central Florida had below-
average capital managed per person ($32 thousand),
but most profitable firms in South Florida were
above-average ($81 thousand), suggesting that this
measure does not bear any consistent relation to
profitability.

Capital Managed Per Acre is another indicator for
balancing productive resources between capital and
land. Capital managed per acre of growing area
averaged $223 thousand for Central Florida nurseries,
and $63 thousand for South Florida firms (Figure 8).
Results for large and small firms on this measure
parallel those for capital managed per person: large
firms were below-average and small firms above-
average, with those in Central Florida having levels
even higher than the highest rates. Highest rates of
capital managed per acre were $249 thousand in
Central Florida and $197 thousand in South Florida.
Lowest rates averaged $53 thousand per acre in
Central Florida, and $31 thousand per acre in South
Florida. Capital managed per acre for the most
profitable firms in Central Florida ($252 thousand)
was even higher than for the "highest" group ($249
thousand), due to a greater number of firms in the
latter group. This measure was also relatively high
for most profitable firms in South Florida ($160
thousand), indicating the importance of adequate
capital investment in growing space.


South Floridc


Central Florida







8


Dol Iars Per Acre (Thousands)
$300
$264
249 $252
$250 .............................................

... ..................7.............



SI-D= i ltMU
$63



Central FlorfC ,9South Florida

Figure 8--Capital managed per acre of growing area.


Costs of Production
The significance of managing production costs has
become heightened by increased competition in the
foliage industry, with falling prices for products
forcing producers to find new ways to cut costs.
Many managers do not clearly understand that costs
include not only cash outlays, but also non-cash costs
and allowances such as depreciation and interest,
which must be covered for the business to remain
viable over the long run.

Costs by Expense Category
Costs were grouped into the following categories:
management's compensation, wages and salaries,
production supplies, other production costs,
administrative and overhead, and non-cash costs.
Table 2 summarizes dollar amounts for each cost
category, and Figures 9a and 9b give percentage
shares of the total for each category, in order to
compare costs among groups differing in average size.
Further details on all itemized expenses are given in
Appendix Tables Sa and 5b.

Management's Compensation or Time Value--
averaged $46 thousand for all Central Florida
nurseries, and $69 thousand for South Florida firms.
These amounts represented 8.6% and 4.9% of total
costs, respectively. Large and small firms differed
appreciably in the dollar amounts and percentages of
total costs for management's compensation. Large
firms compensated management an average of $80
thousand (7.1%) in Central Florida, and $153


Central and South Florida Foliage Nurseries, 1989

compensation for management in small firms was $25
thousand in both regions, but this represented a
greater share of total costs for Central Florida firms
(17%) than for South Florida firms (14%).

Employees' wages and payroll costs is the single
largest cost category for the labor-intensive foliage
industry. In addition to wages and salaries, this
category included benefits, social security, workman's
compensation insurance, health insurance, bonuses,
and other payroll costs. Average labor expenses were
32.8% of total costs ($176 thousand) for Central
Florida nurseries, and 28.7% ($400 thousand for
South Florida firms (Table 2). Large firms in Central
Florida spent a greater percentage of total costs on
employees (38.9%) than did large South Florida firms
(30.7%). Small firms in both regions spent a smaller
share of expenses on employees (18.0% and 21.8%,
respectively) because a lesser share of work was
performed by hired labor.

Production supplies--includes expenses for plants
and seeds, containers, production heating fuel, peat
and soil, fertilizer and lime, pesticides and chemicals,
packaginging and shipping materials, and other
production supplies. Expenses for supplies
represented a nearly equal share of total costs for the
two regions, 30.0% ($161 thousand) for Central
Florida firms, and 30.9% ($431 thousand) for South
Florida firms. Large nurseries in Central Florida
spent 29.5% ($331 thousand) of total costs on
supplies, and those in South Florida spent 30.5%
($1.409 million). Small nurseries spent 29.1% ($43
thousand) in Central Florida, and 25.8% ($45
thousand) in South Florida. The largest single item
within this category was plants and seeds, representing
11.8% of total costs for Central Florida and 11.3% for
South Florida.

Other production costs--were facility
repairs/maintenance and equipment operating costs.
These costs averaged 3.8% ($20 thousand) of total
costs for Central Florida nurseries, and 3.9% ($54
thousand) for South Florida firms. Large and small
firms in both regions had virtually the same share of
total costs for this category (3.4% to 4.0%).


thousand (3.3%) in South Florida. Average








9


Central and South Florida Foliage Nurseries, 1989

Table 2--Costs of Production, foliage nurseries in Central and South Florida, 1989.


Units -------------Central Florida-------------- ------------South Florida-------------
All Largest Smallest Most Profit All Largest Smallest Most Profit
20 Firms 6 Firms 5 Firms 4 Firms 31 firms 7 firms 10 firms 9 firms

Manager's Compensation. $ 46,173 80,178 24,988 39,762 68,777 153,255 25,041 63,771
% 8.6% 7.1% 17.0% 9.8% 4.9% 3.3% 14.4% 7.3%


Employee Labor .....

Supplies. . . . .


$ 175,558 437,781 26,398 123,074
% 32.8% 38.9% 18.0% 30.3%

$ 160,573 331,280 42,764 145,774
% 30.0% 29.5% 29.1% 35.9%


399,776 1,415,238
28.7% 30.7%

430,716 1,409,218
30.9% 30.5%


38,071 186,142
21.8% 21.5%

45,038 274,471
25.8% 31.6%


Other Production Costs. $
%


20,284 37,706 5,868 12,260 53,761 180,260 6,724 25,660
3.8% 3.4% 4.0% 3.0% 3.9% 3.9% 3.9% 3.0%


Admin. & Overhead Costs .

Total Cash Costs . .


Non-Cash Costs . . .


Total All Costs . .


$

$
%

$
%

%


49,884
9.3%

452,472
84.6%


88,489
7.9%

975,433
86.7%


82,070 149,231
15.4% 13.3%

534,541 1,124,665
100.0% 100.0%


13,287
9.0%

113,304
77.2%


33,549
22.8%

146,854
100.0%


30,839
7.6%

351,708
86.7%


54,161
13.3%

405,869
100.0%


181,219 646,490
13.0% 14.0%

1,134,249 3,804,461
81.3% 82.5%

260,623 809,788
18.7% 17.5%

1,394,872 4,614,249
100.0% 100.0%


Supp I es
30.0%


Equip/B cigs.
3.8%
Depreciat ion
4.9%

Management
i8.6%
Admin. & overhead
9.3%


Figure 9a--Distribution of costs of production, Central
Florida foliage nurseries, 1989.


Interest
10.4%


Figure 9b--Distribution of costs of production, South
Florida foliage nurseries, 1989.


20,845
12.0%

135,719
77.9%

38,607
22.1%

174,326
100.0%


107,939
12.4%

657,983
75.8%

209,755
24.2%

867,738
100.0%


Supp I Ies
30. 9%

Equip/B dos.
3.9%
Deprec I at Ion
5.0%
Management
4.9%
interest49%
13.7% Admln. & overhead
13.0%







10


Administrative and overhead are those expenses
which usually cannot be assigned to any particular
production activity, yet must be covered in order to
remain in business. This category included travel,
property insurance, telephone, electric power,
advertising, property taxes, rent, and other cash
expenses. Administrative and overhead expenses
averaged 9.3% ($50 thousand) of total costs for
Central Florida nurseries, and 13.0% ($181 thousand)
for South Florida. Larger firms in South Florida had
a slightly higher share of overhead costs (14.0%),
while large firms in Central Florida had a lower share
(7.9%). Small firms in both regions also had below-
average overhead cost shares: 9.0% in Central
Florida, 12.0% in South Florida.

Total cash costs--included all categories discussed
above. Total cash costs averaged $452 thousand for
Central Florida nurseries, and $1.134 million for
South Florida firms. These amounts represented
84.6% and 81.3% of total costs, respectively. Large
firms in both regions had a slightly greater percentage
of cash costs to total costs: 86.7% for Central Florida,
82.5% for South Florida. On the other hand, small
nurseries had lower share of total cash costs: 77.2%
for Central Florida, 77.9% for South Florida.

Non-cash costs--included depreciation on fixed
assets (buildings, equipment), decreases in supply
inventories, and an interest charge on capital owned
to reflect the opportunity cost of assets used. These
costs averaged $50 thousand for Central Florida
nurseries, and $261 thousand for South Florida firms.
The largest share of these costs was for interest:
10.4% of total costs for Central Florida, and 13.7%
for South Florida. Depreciation represented 4.7%
and 5.1% of total costs, respectively.


Cost Efficiency
Cost efficiency can be assessed in terms of costs
per unit area of production space (per square foot),
or costs per unit of revenue (sales and production).

Cost Per Square Foot of Growing Space
Square foot costs are a useful measure for
estimating individual plant growing costs or comparing
cost efficiency of different types of production
systems. Total costs per square foot averaged $5.39
for Central Florida nurseries, and $1.17 for South
Florida firms (Figure 10). Central Florida's large
firms had below-average costs per square foot ($5.11)
and small firms were substantially below average


($4.61). In South Florida, large firms also had below-


Central and South Florida Foliage Nurseries, 1989

average cost per square foot ($1.04), but small firms
had above-average costs ($1.41). Highest costs per
square foot averaged $9.89 in Central Florida and
$4.82 in South Florida, while lowest costs averaged
$3.57 and $.77, respectively. The most profitable
firms had total costs per square foot of $8.57 in
Central Florida and $2.35 in South Florida, both far
above-average, but below the highest rates.


Figure 10--Costs per square foot of
space.


total growing


Costs Per Sq.Ft. of Propagating & Finishing Space
Cost per square foot on the basis of propagating
and finishing space only (excluding stock plant space)
is a more narrow measure of costs for salable
products, and are associated with higher cost levels.
The general pattern of results for this measure
parallel those for costs per square foot of total
growing area. However, South Florida firms had
proportionately higher costs on this basis versus total
growing area ($1.85 vs. $1.17), than did Central
Florida nurseries ($6.15 vs. $5.39) because of their
greater share of total growing area dedicated to stock
plant space.

Costs Per Dollar Value of Production
Cost per unit of revenue is a direct measure of
long-term profitability. As shown in Figure 11, total
costs averaged $1.13 per dollar value of production,
or 113% of revenue for the Central Florida nurseries,
and 109% for South Florida firms. Thus, average
total costs for both regions exceeded the breakeven
cost level of $1.00 per dollar value of production.
However, this deficit did not really represent a "loss",
but merely a failure to meet the interest cost


Per Square Foot


Do I ars
12.0 r


1D.0

8.0

6.0

4.0

2.0


E AAll Trim

aXl HtI mlot
m Lo..t rati.
M most prior it bl


Ctra Flo 4.uth Flor



Cantrl Florida 5outh FlOrIC


0.0L







Central and South Florida Foliage Nurseries, 1989

allowance for a 12 percent return on capital
investment. Large and small firms in both regions
were also above the break-even cost level (Figure 11).
The most profitable firms had total costs averaging
93% of total value of production in Central Florida,
and 81% in South Florida. Further details on these
results are given in Appendix Tables 6a and 6b.


Figure 11--Cost per dollar value of production (sales
plus inventory change).

Cash Costs Per Dollar of Sales
This is a short-term measure of profitability and
financial solvency relating only current cash expenses
with current income (sales). Cash costs averaged
93% of sales for Central Florida firms, and 93% for
South Florida firms. Large firms had cash costs of
94% and 95%, respectively. Small firms in both
regions had the serious problem of cash costs
exceeding sales by 12% in Central Florida and 2% in
South Florida. This means that these firms were not
able to meet current operating expenses from
cashflow generated by sales. Most profitable firms
had cash costs of 80% and 85% of sales, respectively.

Income Summary
In Table 3, income and costs are reorganized to
derive net income in a manner more like traditional
accounting practices.

Total gain is the total value of plant sales, changes
in plant and supply inventory values, and
miscellaneous income. In addition to the plant sales
and inventory growth revenue discussed previously,
miscellaneous income averaging $1,765 for Central
Florida firms and $12,437 for South Florida firms


11


gave a total gain of $474 thousand and $1.296 million,
respectively (Table 3).

Cost deductions are the same as total costs
discussed previously, except for commission of the
operator's salary and allowance for interest on capital,
so that these costs can be explicitly recognized. Total
deductions averaged $432 thousand for Central
Florida nurseries, and $1.136 million for South
Florida firms. Total deductions are subtracted from
total gain to give net nursery income.

Net nursery income is the total annual return for
the firm, before income taxes, compensation to
management and interest on capital. Average net
nursery income was $42 thousand for Central Florida
nurseries and $161 thousand for South Florida firms
(Table 3). Large firms had average net incomes of
$89 thousand in Central Florida, and $142 thousand
in South Florida. Small firms in South Florida had
average net incomes of $23 thousand, and those in
Central Florida had negative net incomes of $6
thousand! The most profitable firms in Central
Florida had net incomes of $107 thousand, and those
in South Florida had $424 thousand.

Return to Capital
Net nursery income may be apportioned between
returns to management and returns on capital
investment in order to evaluate the economic
efficiency of these resources. Return to capital is the
part of net nursery income attributable to the capital
investment, calculated by subtracting the
compensation to management from net nursery
income. Return to capital averaged minus $4
thousand for Central Florida nurseries and $92
thousand for South Florida nurseries. The negative
return to capital for Central Florida firms simply
means that all net income was taken by management
rather than paid as dividends to stockholders or kept
as retained earnings.








Central and South Florida Foliage Nurseries, 1989


Table 3--Income Summary, Central and South Florida Foliage Nurseries, 1989.

Units -------------Central Florida--------------- ------------South Florida----------
All Largest Smallest Most Profit All Largest Smallest Most Profit
20 Firms 6 Firms 5 Firms 4 Firms 31 firms 7 firms 10 firms 9 firms
Total Gain ...... $ 474,376 1,034,326 92,418 440,738 1,296,482 4,033,553 143,175 1,082,984


Total Deductions . .
Net Nursery Income . .
Manager's Compensation
Return to Capital. .


$ 432,610
$ 41,766
$ 46,173
$ (4,407)
% -0.95


945,688 98,675 333,345
88,638 (6,256) 107,393
80,178 24,988 39,762
8,461 (31,244) 67,632
1.03 -16.17 24.77


1,135,656 3,891,908 120,147 659,310
160,827 141,645 23,029 423,674
68,777 153,255 25,041 63,771
92,049 (11,610) (2,012) 359,903
5.80 -0.24 -0.83 29.86


Net profit margin is the ratio between return to
capital and total gain. As shown in Figure 12, South
Florida's firms had a net profit margin of 7.1%. Since
Central Florida's firms had a negative return to
capital, net profit margin was negative 0.9%. The
most profitable firms had net profit margins of 15.3%
in Central Florida and 33.2% in South Florida.


:ent)


M Allt firrlt


EM m prirt"sbli


Central Flor iM


Figure 12--Net profit m
capital and to total gain.


South Florida


argin. Ratio of return to


Rate of return on capital is a common indicator
for evaluating alternative investments, comparable to
annualized yields on stocks, bonds, or savings
deposits. It is calculated by dividing return to capital
by the total current value of capital owned. Rate of
return on capital averaged minus 0.95 percent for
Central Florida nurseries and 5.80 percent for South
Florida nurseries (Figure 13). Large firms in Central
Florida had an average rate of return on capital of
1.0%, while small firms and both large and small
firms in South Florida had negative rates of return.
The most profitable firms had rates of return on
capital averaging 24.8% in Central Florida, and 29.9%
in South Florida.


Return to Capital/Capital Owned (%)
40.0

29.9 .
30.. -........................ ................
24e.8

20.0 ........................................
EM Laro*t
10.. ............................ ar&llest



-10.0 ME
-5.2


r.21E. 5.7
-20.0 -5I
Central Florfid South Florida


Figure 13--Rate of return to capital. Expresses ratio
of return to capital and owned capital (current value).

Financial Position

Assets and liabilities are depicted in Figure 14.
These data represent the mid-year financial situation
of the nurseries, derived as an average of the year-
beginning and year-end balance sheet figures.


Assets

Total assets are the same as capital owned,
discussed previously.

Current Assets consisted of cash on hand,
accounts receivable, and plant and supply inventories.
Total current assets averaged $275 thousand for
Central Florida and $1.105 million for South Florida.
Cash on hand averaged $29 thousand for Central
Florida nurseries and $48 thousand for South Florida
firms. Accounts receivable averaged $60 thousand for
Central Florida nurseries and $274 thousand for
South Florida. As a proportion of annual sales, these
amounts represented 12 percent and 22 percent,
respectively. Supply inventories represented $24


--


12







Central and South Florida Foliage Nurseries, 1989


A92"tS bnd Llabf I.
Current Azzets
Lono-Ter Assets
Crrert Liabil.
Long-Term Lrabtl.


South Florida


Figure 14--Assets and Liabilities, nurseries in Central
and South Florida, 1989.



thousand for Central Florida and $20 thousand for
South Florida. Total current assets, including plants
inventories, which were already discussed, averaged
$276 thousand for Central Florida nurseries and
$1.105 million for South Florida firms.

Long term assets included investments in
buildings, machinery and land. Only owned assets
were included here, not leased assets. Current values
of fixed assets are the original cost less accumulated
depreciation. Original investments averaged $446
thousand for Central Florida nurseries and $895
thousand for South Florida firms. Subtracting
accumulated depreciation left a current value of $189
thousand for Central Florida nurseries and $482 for
South Florida firms. South Florida nurseries had less
depleted fixed assets: as a portion of the original
investment, these current values represented 42
percent and 54 percent, respectively.

Liabilities
Liabilities represented in the Nursery Business
Analysis did not include any debt to related parties in
closely held or "family" corporations, as these are
usually not true debts which must be repaid. Total
liabilities averaged $147 thousand for Central Florida
firms and $601 thousand for South Florida nurseries.

Current Liabilities averaged $19 thousand for
Central Florida nurseries and $339 thousand for
South Florida firms. These current liabilities
represented an extremely secure position for Central


Dol lars Cthousands)
t. n r-


by simply dividing return to capital ($) by net worth.


1,1500 ..-


$ IO --*- *""*""--- ""**


ei sa7


$500


$147
0114,;


so'


Centra Florida


13


Florida firms, but a very insecure position for South
Florida firms. The ratio of cash and accounts
receivable to current liabilities, known as the "quick
ratio", is a standard indicator of the ability to pay
current operating expenses. This measure averaged
4.75 for Central Florida nurseries and 0.95 for South
Florida firms. This represents a very serious situation
for the South Florida firms, indicating difficulty in
meeting current liabilities from operating cash flow.

Long Term Liabilities, including notes payable and
mortgages, averaged $129 thousand for Central
Florida nurseries and $262 thousand for South Florida
nurseries.

Net Worth is the difference between total assets
and total liabilities, or the value of the owner's share
of the assets, as opposed to lenders' claims. Net
worth averaged $317 thousand for Central Florida
nurseries, and $986 thousand for South Florida firms.

Financial Leverage
Leverage expresses the ratio between total assets
and net worth. Higher values indicate a greater
potential for "multiplying" returns per dollar of net
worth, but also a greater financial risk. The leverage
ratio averaged 1.46 for Central Florida firms and 1.61
for South Florida firms (Figure 14). In other words,
South Florida firms had a greater value of total assets
per dollar of net worth than did Central Florida firms.
Small firms in Central Florida had significantly above-
average leverage (2.33), and large firms were below-
average. Large and small firms in South Florida
showed the opposite pattern. Highest rates for
leverage averaged 2.97 in Central Florida and 3.15 in
South Florida, while lowest rates were 1.13 and 1.08
respectively. Generally, leverage factors below 2.0 are
considered to represent a very safe financial position.
There was no indication of a consistent relationship
between financial risk and profitability, as most
profitable firms in Central Florida were leveraged
substantially above-average (2.10), but profitable firms
in South Florida were leveraged below-average (1.42).



Return on Net Worth
The ultimate measure of profitability is expressed
in terms of returns per unit of net worth. This
measure takes into account the financial risk
embodied in the leverage factor. Leverage is
multiplied by rate of return to capital to yield the rate
of return on net worth. This is the same as derived







14


Figure 15--Leverage factor. Expresses ratio between
total assets and net worth. Higher values indicate
greater potential returns on net worth, but also
greater financial risk.





Since leverage is always greater than or equal to one,
return on net worth is always greater than or equal to
the absolute value of rate of return on capital.
Return on net worth averaged minus 1.4 percent for
Central Florida firms and 9.3 percent for South
Florida nurseries. Large firms had returns on net
worth averaging 1.4% in Central Florida and minus
0.4% in South Florida, while small firms had minus
37.7% and minus 1.2%, respectively. The most
profitable firms had returns on net worth averaging
52.1% in Central Florida and 42.3% in South Florida.

SUMMARY

Key Factors Relating to Profitability
Characteristics of the most profitable nurseries in
each region are summarized in Table 4, by
comparison to the overall averages. Differences
between groups are presented as percentages
reflecting the deviation of the most profitable firms
from the industry averages. Also, qualitative
descriptors of this relationship are given, with
deviations of 0% to 19% labeled as "normal," 20% to
49% as "high" or "low," and 50% or greater as "very
high" or "very low." Most profitable firms in both
regions had very high space productivity
(production/sq ft) and space costs (total costs/sq ft),
and high labor productivity (production/person).


Total Assets/Net Worth
4.0


3.0
3.0 ---
.0 All tlrw
2.1
2.0 ...........I.B Bh ram"

at lesproftle
2.0




0.0


Central and South Florida Foliage Nurseries, 1989

Inventory turnover and managed capital turnover
were high and very high, respectively, for profitable
firms in Central Florida, but low and normal,
respectively for South Florida firms. On the other
hand, capital managed per person and capital
managed per person acre were high and very high for
profitable South Florida firms, but low and normal for
Central Florida firms. Space/Labor intensity was
above average for both regions, as indicated by low or
very low growing area per person. Costs per dollar
value of production for profitable firms in both
regions were low for labor, other production costs,
and overhead. Supply costs were also low for South
Florida firms, and non-cash costs were low for
Central Florida nurseries. Overall financial position
of profitable firms in Central Florida was more
leveraged than average, as indicated by a low ratio of
total assets to total liabilities, but profitable firms in
South Florida were high on this measure.


CONCLUDING COMMENTS
Nearly all indicators showed a decline in the
business performance of Central and South Florida
foliage nurseries in 1989 from the previous year. The
decline in profitability was probably due to generally
lower product price levels, higher costs, and increased
competition, rather than a change in productivity or
efficiency of resources in the industry. However,
lower returns to investments will probably curtail
growth in the industry, and perhaps bring about some
reduction in production capacity, eventually reducing
competition, balancing supply and demand, and
restoring profitability to normal levels.


The Florida Nursery Business Analysis
Program
This program is a service of the University of
Florida, provided on a strictly confidential basis, and
is free of charge. Besides this program for foliage
nurseries, other programs exist for woody ornamental
container nurseries, field nurseries, and flowering
plant nurseries. Nursery managers interested in
participating may contact the authors or an IFAS
agent in a local county extension office. Nursery
operators who authorize a commercial accounting
firm to supply the data required for the program can
participate with a minimum of effort on their part.


routh Florida


Certral Florida








15


Central and South Florida Foliage Nurseries, 1989

Table 4--Summary of Most Profitable Firms


-----------Central Florida----------- ----------South Florida----------
All Most Profit Deviation I All Most Profit Deviation
20 firms 4 firms from average 1 31 firms 9 firms from average
------------------------------ ----- w-------- wtt------- W-"------- f--Mw------ft-------- ft --------------------


Value of Production/Sq Ft Growing Space


$4.77


Inventory Turnover . . . .... 297.8%

Value of Production per Person ..... .$37,405

Growing Area per Person. . . ... .. 7,846

Managed Capital Turnover ...... 95.7%

Managed Capital Per Person ...... $40,192

Managed Capital Per Acre . . ... $223,146

Total Costs/Sq Ft Growing Space . . $5.39


Costs/Dollar Value of Production
Labor . . . . . . . .

Supplies. . . . . ....

Other Production Costs. .....

Administrative and Overhead .

Non-Cash Costs. . . . .

Total .. . .. . . .

Cash Costs/Dollar Value of Sales ....

Quick Ratio. . .. . . . ..

Total Assets/Total Liabilities ....


$0.47

$0.34

$0.04

$0.11

$0.17

$1.13

$0.93

4.75

3.15


$9.24 94% Very High


39%

36%

-30%

67%

-21%

13%

59%


-21%

-2%

-35%

-33%

-29%

-18%

-14%

-37%

-40%


412.7%

$50,827

5,498

159.9%

$31,810

$252,034

$8.57


$0.37

$0.33

$0.03

$0.07

$0.12

$0.93

$0.80

2.97

1.91


High

High

Low

Very High

Low

Normal

Very High


Low

Normal

Low

Low

Low

Normal

Normal

Low

Low


$1.07

159.8%

$44,428

41,564

70.1%

$60,550

$63,457

$1.17


$0.37

$0.34

$0.04

$0.14

$0.20

$1.09

$0.93

0.95

2.64


$2.88 170% Very High

107.6% -33% Low

$63,795 44% High

22,144 -47% Low

56.8% -19% Normal

$81,341 34% High

$160,006 152% Very High

$2.35 101% Very High


$0.23

$0.26

$0.02

$0.10

$0.20

$0.81

$0.85

1.11

3.41


-36%

-24%

-43%

-29%

-3%

-25%

-8%

18%

29%


Low

Low

Low

Low

Normal

Low

Normal

Normal

High


Qualitative Descriptors: very low, low, normal, high, very high.
Low and high descriptors represent deviations from industry average between 20% and 50%.
Very Low and Very High descriptors represent deviations from industry average greater than 50%.







Central and South Florida Foliage Nurseries, 1989


APPENDIX


DEFINITIONS
Value of Own Plants Sold: the value of total plant
sales minus cost of plants purchased for immediate
resale (brokered), giving net sales of nurser-produced
products.

Full-Time Equivalent Worker: the equivalent of
one person working 40 hours a week for 52 weeks a
year (2080 hours a year). The most common method
for obtaining the number of full-time employees for
this report was to divide the total annual payroll
hours for the nursery by 2080, then add the number
of family and management personnel not paid on an
hourly basis.

Capital Owned: the current value of land,
buildings, equipment (cost less accumulated
depreciation), and other current assets. Related debt
is not deducted in this determination.

Capital Managed: the value of capital owned
(above) plus the market value of additional leased
land, buildings, or equipment.

Total Gain: the sum of plant sales, changes in
plant and supply inventories, and miscellaneous cash
income. It represents the total result of the year's
operations.

Net Nursery Income: the return for the time and
skills of management, and for the use of the capital
invested in the operation. It is calculated as total gain
less all cash costs, except management's
compensation, and all non-cash costs, except the
non-cash interest allowance on capital.

Return to Capital: is what the owned capital
earned, calculated as the portion of net nursery
income that is left after subtracting management's
compensation or time value.

Rate of Return On Capital: is the rate earned on
the capital invested, equivalent to quoted yields on
stocks, bonds, savings deposits. It is calculated as
return to capital divided by the value of owned
capital.


NOTES ON CALCULATIONS
Analysis of your own operation for comparison
with the findings of this report can be done with the
information in the Appendix Tables. Blank spaces
are provided for entry of your data. Make
calculations for your nursery data in Appendix Tables
2, 3, 4, and 5, according to the formulas shown on
each line which refer to Appendix Table 1.

The University of Florida also supports a
microcomputer program for making these
calculations. This program can be ordered for $20
from:
IFAS Software Support Office
Building 120, Room 203
University of Florida
Gainesville, FL 32611
tel. # (904) 392-7853


LIST OF APPENDIX TABLES

Central Florida Foliage Nurseries


Appendix Table
la Size of business .............. ...
2a Space use indicators ................
3a Labor use indicators ................
4a Capital use indicators ...............
5a Costs by expense category ............
6a Costs per dollar value of production .....


Page
17


18
19
20
21


South Florida Foliage Nurseries
Appendix Table Page
lb Size of business .................... 22
2b Space use indicators ................ .23
3b Labor use indicators ........... ..... 23
4b Capital use indicators ............... .. 24
5b Costs by expense category ............ 25
6b Costs per dollar value of production ..... 26


16








17


Central and South Florida Foliage Nurseries, 1989


APPENDIX TABLES


Appendix Table la--Size of Business, Central Florida Foliage Nurseries, 1989.


ALL Largest Smallest Most Profit Your
unit 20 Firms 6 Firms 5 Firms 4 Firms Nursery
------------------------------------f--------- ------ft-------------------------------------------


A Value of own plants sold ....... $
B Change in inventory value. . . . ... $

C Total value of production. . . . ... $

D Space for propagating & finishing. ... .. sq.ft.
E Space for stock plants ........ .sq.ft.

F Total growing space. . . . . .. .sq.ft.
G acres

H Total nursery area ........... .acres


486,185
(13,574)

472,611

86,895
12,237

99,132
2.28

4.18


I Full-time equivalent persons ...... .number 12.64


------------Capital Owned-------------
Growing plants ..........
Bldgs, improvements. . . . .
Machinery & equipment. . . . .
Land . . ... ... .. .
Supply inventory . . . ...
Accounts receivable. . .. ..
Cash on hand ....... . .


$
$
$
$
$
$
$


Q Total Owned Capital . . . . . .. $


------------CapitaL Leased-------------
BLdgs, improvements. . . . . . .
Machinery & equipment. . . . . . .
Land . . ... . .. . ......


$
$
$


U Total Leased Capital . . . . ... $

---Capital Managed (owned + Leased)----
V Growing plants . . .. ... . $
W Bldgs, improvements. .... ........ $
X Machinery & equipment. ... . . . $
Y Land . . . . . . . . . .. $
Z Supply inventory . .. . . . . .
AA Accounts receivable .. . . . .... $
AB Cash on hand . . . . . . . .. $

AC Total Capital Managed . . . . $


1,025,511
7,324

1,032,835

189,526
30,511

220,037
5.05

7.65

28.79


100,494
(9,020)

91,474

31,651
240

31,891
0.73

1.00

2.94


438,127
(292)
-----------
437,835

42,793
4,567

47,360
1.09

2.74

8.61


163,234 310,152 50,794 106,153
118,809 157,398 93,015 41,005
24,799 36,162 16,690 8,462
45,533 45,706 17,894 32,672
23,669 67,721 1,258 8,164
59,975 143,421 6,911 72,373
28,628 62,769 6,697 4,193

464,648 823,328 193258 273,020-------- ---- ---
464,648 823,328 193,258 273,020


17,750
8,178
17,250

43,178


163,234
136,559
32,977
62,783
23,669
59,975
28,628

507,826


0
0
15,833

15,833


310,152
157,398
36,162
61,539
67,721
143,421
62,769

839,161


0
0
0

0


50,794
93,015
16,690
17,894
1,258
6,911
6,697

193,258


1,000
0
0

1, 000


106,153
42,005
8,462
32,672
8,164
72,373
4,193

274,020


Notes: Propagating/finishing space is for product for sale.
** Full-time equivalent person is 2080 hrs/year.


------------------- ----------








Central and South Florida Foliage Nurseries, 1989



Appendix Table 2a--Space Use Indicators, Central Florida Foliage Nurseries, 1989.


ALl Largest Smallest Most Profit Your
unit 20 Firms 6 Firms 5 Firms 4 Firms Nursery


Sales/sq ft growing space . (Table 1A/1F) $
Production/sq ft growing space. (Table 1C/1F) $

Sales/sq ft prop. & fin. space. (Table 1A/1D) $
Value of prod./sq ft . . (Table 1C/1D) $

Sales/acre growing area. . .(Table 1A/1G) $
Production/acre . . . ... (Table 1C/IG) $

Plant inventory turnover . . (Table 1A/1J) %

Average vacant growing space. . . . ..sq ft
--percentage of growing space . . . . %

Total nursery area . . . . . .. sq ft
(incl. roads, parking, office, etc.)

Total growing space . . . . . sq ft
--percent of total nursery area (Table 1F/1G) %

Propagating & finishing space . . .sq ft
--percent of total growing space (Table 1D/IF) %

Stock plant space .... . . . sq ft
--percent of total growing space (Table 1E/1F) %


4.90
4.77

5.60
5.44

213,636
207,672

297.8

8,853
8.9

182,025


99,132
54.5

86,895
87.7

12,237
12.3


4.66
4.69

5.41
5.45

203,017
204,467

330.6

20,144
9.2

333,067


220,037
66.1

189,526
86.1

30,511
13.9


3.15
2.87

3.18
2.89

137,264
124,944

197.8

2,040
6.4

43,435


31,891
73.4

31,651
99.2

240
0.8


9.25
9.24

10.24
10.23

402,974
402,705

412.7

3,023
6.4

119,141


47,360
39.8

42,793
90.4

4,567
9.6


Appendix Table 3a--Labor Use Indicators, Central Florida Foliage Nurseries, 1989.
ALL Largest Smallest Most Profit Your
unit 20 Firms 6 Firms 5 Firms 4 Firms Nursery


Plant sales per person* .. .. (Table 1A/11) $ 38,479 35,620 34,187 50,861
Value of production per person* (Table 1C/1I) $ 37,405 35,874 31,119 50,827

Growing area per person*. . (Table 1F/11) sq.ft. 7,846 7,643 10,849 5,498
Persons per acre growing area (Table 1F/1G) number 5.55 5.70 4.02 7.92


* Full-time equivalent person (2080 hr/year)


18








Central and South Florida Foliage Nurseries, 1989 19


Appendix Table 4a--Capital Use Indicators, Central Florida Foliage Nurseries, 1989.
ALL Largest Smallest Most Profit Your
unit 20 Firms 6 Firms 5 Firms 4 Firms Nursery

Owned capital turnover. ... (Table 1A/10) % 104.6 124.6 52.0 160.5
Managed capital turnover. .(Table 1A/1AC) % 95.7 122.2 52.0 159.9

Capital owned/person* . . (Table 1Q/1I) $ 36,774 28,597 65,745 31,694
Capital managed/person* . .(Table 1AC/1) $ 40,192 29,147 65,745 31,810

---Managed Capital Per Person In---
Growing plants. ....... (Table 1V/1I) $ 12,919 10,773 17,280 12,323
Bldgs, improvements ..... (Table 1W/1I) $ 10,808 5,467 31,643 4,876
Machinery & equipment .... (Table 1X/11) $ 2,610 1,256 5,678 982
Land. ...... ......... (Table 1Y/11) $ 4,969 2,137 6,087 3,793

Capital owned/acre. ...... (Table 1Q/1G) $ 204,173 162,992 263,971 251,115
Capital managed/acre. .... .(Table 1AC/1G) $ 223,146 166,126 263,971 252,034

---Managed Capital Per Acre In---
Growing plants. ....... (Table 1V/1G) $ 71,727 61,400 69,380 97,636
Bldgs, improvements ..... (Table 1W/1G) $ 60,006 31,160 127,049 38,634
Machinery & equipment .... (Table 1X/1G) S 14,491 7,159 22,796 7,783
Land. . . . . . ... (Table 1Y/1G) $ 27,588 12,183 24,441 30,051

---Distribution of Managed Capital---
in growing plants ..... .(Table 1V/1AC) % 32.1 37.0 26.3 38.7
in buildings & wells. .. .(Table 1W/1AC) % 26.9 18.8 48.1 15.3
in machinery & equipment. .(Table 1X/1AC) % 6.5 4.3 8.6 3.1
in land .......... .(Table 1Y/1AC) % 12.4 7.3 9.3 11.9
in supply inventory .... .(Table 1Z/1AC) % 4.7 8.1 0.7 3.0
in accounts receivable. .. .(Table 1AA/1AC) % 11.8 17.1 3.6 26.4
in cash/checkbook balance .(Table 1AB/1AC) % 5.6 7.5 3.5 1.5

TOTAL. ... . . ...... ....... .. .% 100.0 100.0 100.0 100.0

Full-time equivalent person (2080 hr/year)








Central and South Florida Foliage Nurseries, 1989


Appendix Table 5a--Costs by Expense Category, Central Florida Foliage Nurseries, 1989.


ALL Largest Smallest Most Profit Your
unit 20 Firms 6 Firms 5 Firms 4 Firms Nursery
------------ m-------- m------ m------------------- --------WW------ M--- W--- W-M---- W-M---- ----------- M------
Operator's salary ........... $ 46,173 80,178 24,988 39,762
Other wages ...... .... .. $ 175,557 437,781 26,397 123,074

LABOR TOTAL ................ $ 221,731 517,959 51,386 162,836


Plants & seeds. . . . .. .. . .
Containers. .. . . .. . . . .
Heating fuel. ...............
Peat & soil ... ............
Fertilizers & lime. . .. .....
Pesticides & chemicals. . .......
Packaging & shipping supplies .... ..
Other production supplies . . . ...

SUPPLIES TOTAL. . . . . .. . .

Facility repairs ..................
Equipment operation ..... . . . .

OTHER PRODUCTION COSTS TOTAL. . .. ..


Travel. . ...........
Insurance ... .......
Telephone ..........
Electricity .........
Taxes & licenses. .. . .
Advertising ........
Rent-land/buildings ....
Other cash costs . . .


ADMINISTRATIVE & OVERHEAD COSTS TOTAL . .

TOTAL CASH COSTS . .. .. .. .

Depreciation-machinery/equipment. . . .
Depreciation-buildings/etc . .. . .
Supply inventory decrease . . . . .
Interest on capital*. . . . ... ...

TOTAL NON-CASH COSTS. .. . . . . .

TOTAL ALL COSTS . . . . . .


$
$
S$
$
$
$
$
$

$

$
$

$


. . . . $

. . . . $
. . . . $
. . . . $
. . . . $
$
~~$
$
~~~~~$
~$
~~~$
~~~


$

$

$
$
$
$

$

$


62,844
25,449
11,020
14,476
6,031
7,916
23,564
9,275

160,573

13,727
6,557

20,284

4,109
9,602
4,005
7,311
3,952
1,920
4,752
14,233

49,884

452,472

8,063
16,980
1,269
55,758

82,070

534,541


122,670
51,047
20,991
29,695
13,634
15,054
59,055
19,135

331,280

27,951
9,755

37,706

8,750
15,519
9,039
14,072
5,402
3,697
0
32,010

88,489

975,433

19,425
26,584
4,423
98,799

149,231

1,124,665


21,011
6,948
2,527
3,127
1,303
2,483
4,023
1,342

42,764

3,044
2,824

5,868

303
3,247
1,214
3,247
2,410
82
0
2,784

13,287

113,304

3,166
7,192
0
23,191

33,549

146,854


74,409
14,734
9,782
9,906
3,188
5,086
18,440
10,229
-----------
145,774

8,802
3,458

12,260

1,218
7,110
2,893
3,163
3,575
880
1,109
10,891

30,839

351,708

4,560
14,971
1,867
32,762

54,161

405,869


* Note: Interest on capital is 12% charge on owned capital value.


20


~~r~~~~~r~~r~~PZ~t~ZZ=r-








21


Central and South Florida Foliage Nurseries, 1989


Appendix Table 6a--Costs Per Dollar's Worth of Production, Central Florida Foliage Nurseries, 1989. *


All Largest Smallest Most Profit Your
unit 20 Firms 6 Firms 5 Firms 4 Firms Nursery
------------------ft------W-------ft----------------------- ---------- W-----------
Operator's salary ............. cents 9.8 7.8 27.3 9.1
Other wages .......... ...... cents 37.1 42.4 28.9 28.1

LABOR TOTAL ................ cents 46.9 50.1 56.2 37.2


Plants & seeds ... . . .
Containers . . . . .
Heating fuel. ..... . .
Peat & soil . .. .....
Fertilizers & lime ......
Pesticides & chemicals. .....
Packaging & shipping supplies .
Other production supplies . .


. cents
. cents
. cents
. cents
. cents
. cents
. cents
. cents


SUPPLIES TOTAL. .. .... .... .. .. .cents

Facility repairs. ........... cents
Equipment operation . . .. . . .cents

OTHER PRODUCTION COSTS TOTAL. .. .. .. cents


Travel . . ..
Insurance. .. ...
Telephone . . .
Electricity . .
Taxes & licenses ..
Advertising .....
Rent-land/buildings .
Other cash costs. .


. cents
. cents
. cents
. cents
. cents
. cents
. cents
. cents


ADMINISTRATIVE & OVERHEAD COSTS TOTAL . cents

TOTAL CASH COSTS. .... . ......... cents


Depreciation-machinery/equipment.
Depreciation-buildings/etc. .
Supply inventory decrease . .
Interest on capital . . . .


. cents
S. cents
. cents
S. cents.


TOTAL NON-CASH COSTS ... . ... . .. cents

TOTAL ALL COSTS . . . . .cents


13.3
5.4
2.3
3.1
1.3
1.7
5.0
2.0

34.0

2.9
1.4
----------
4.3

0.9
2.0
0.8
1.5
0.8
0.4
1.0
3.0

10.6

95.7

1.7
3.6
0.3
11.8

17.4

113.1


11.9
4.79
2.0
2.9
1.3
1.5
5.7
1.9

32.1

2.7
0.9

3.7

0.8
1.5
0.9
1.4
0.5
0.4
0.0
3.1

8.6

94.4

1.9
2.6
0.4
9.6

14.4

108.9


23.0
7.6
2.8
3.4
1.4
2.7
4.4
1.5

46.7

3.3
3.1

6.4

0.3
3.5
1.3
3.5
2.6
0.1
0.0
3.0
----------
14.5

123.9

3.5
7.9
0.0
25.4

36.7

160.5


17.0
3.4
2.2
2.3
0.7
1.2
4.2
2.3

33.3

2.0
0.8
-----------
2.8

0.3
1.6
0.7
0.7
0.8
0.2
0.3
2.5

7.0

80.3

1.0
3.4
0.4
7.5

12.4

92.7


* Production is annual sales plus inventory change.


DIIIIIIII~~L








22


Central and South Florida Foliage Nurseries, 1989



Appendix Table lb--Size of Business, South Florida Foliage Nurseries, 1989.


All Largest Smallest Most Profit Your
unit 31 firms 7 firms 10 firms 9 firms Nursery
--------- ---------- --------------- --ft-------- M-t------ M-------------------------- -------------------


A Value of own plants sold . . . . .. $ 1,221,002
B Change in inventory value. . . . ... 56,900

C Total value of production. . . . . $ 1,277,902

D Space for propagating & finishing. . . .sq.ft. 751,338
E Space for stock plants .......... .sq.ft. 444,182

F Total growing space. . . . . . ..sq.ft.1,195,519
G acres 27.45


H Total nursery area . ....... .. .acres


33.39


I Full-time equivalent persons ..... . .number 28.76


4,045,296
(79,336)

3,965,961

2,670,130
1,750,486

4,420,615
101.48

115.87

96.32


132,695
8,173

140,868

72,977
50,559

123,536
2.84

5.21

3.87


771,082
293,767

1,064,849

217,317
152,313

369,630
8.49

13.67

16.69


-------Capital Owned-----------
Growing plants . . . . . .
Bldgs, improvements. . . . .
Machinery & equipment .. . . .
Land .. ... ... .........
Supply inventory . . . . .
Accounts receivable. .. . . .
Cash on hand . . . . . .


$
$
$
$
$
$
$


Q Total Owned Capital. . . . . . .
------------Capital Leased-------------
R Bldgs, improvements .. .. . . . $
S Machinery & equipment. . . . . $
T Land . . . . . . . . . ..

U Total Leased Capital . . . . ..


---Capital Managed (owned + leased)----
V Growing plants .. ... . . .
W Bldgs, improvements. . . . . .
X Machinery & equipment. ........
Y Land . . . . . ...
2 Supply inventory. . . . . .
AA Accounts receivable . .. .. ..
AB Cash on hand . ... . . .


$
$
$
$
$
$
$


AC Total Capital Managed . . . . ..


764,030 2,196,798 92,333 716,822
175,948 506,598 34,435 218,484
68,516 202,207 15,828 48,090
237,158 597,039 75,710 61,753
20,168 68,835 4,206 20,976
273,357 1,020,205 16,337 111,148
47,812 150,701 3,975 28,207

1,586,989 4,742,383 242,826 1,205,480


14,636
5,081
134,903

154,619


764,030
190,583
73,597
372,061
20,168
273,357
47,812

1,741,608


62,022
20,000
352,177

434,199


2,196,798
568,620
222,207
949,216
68,835
1,020,205
150,701

5,176,582


625
1,050
61,175

62,850


92,333
35,060
16,878
136,885
4,206
16,337
3,975

305,676


1,330
400
150,525

152,255


716,822
219,814
48,490
212,278
20,976
111,148
28,207

1,357,735


Notes: Propagating/finishing space is for product for sale.
** Full-time equivalent person is 2080 hr/year.








Central and South Florida Foliage Nurseries, 1989


Appendix Table 2b--Space Use Indicators, South Florida Foliage Nurseries, 1989.
All Largest Smallest Most Profit Your
unit 31 firms 7 firms 10 firms 9 firms Nursery
------------------------------"----------------------- --- W--- W----------M------ --------

Sales/sq ft growing space . (Table 1A/1F) $ 1.02 0.92 1.07 2.09
Production/sq ft growing space. (Table 1C/1F) $ 1.07 0.90 1.14 2.88

Sales/sq ft prop. & fin. space. (Table 1A/1D) $ 1.63 1.52 1.82 3.55
Value of prod./sq ft ...... (Table 1C/1D) $ 1.70 1.49 1.93 4.90

Sales/acre growing area ..... (Table 1A/1G) $ 44,488 39,862 46,790 90,870
Production/acre. ........ (Table 1C/1G) $ 46,562 39,080 49,671 125,490

Plant inventory turnover . . (Table 1A/1J) % 159.8 184.1 143.7 107.6

Average vacant growing space ......... ..sq ft 80,620 127,580 5,338 127,100
--percentage of growing space ......... % 6.7 2.9 4.3 34.4

Total nursery area. .............. sq ft 1,454,474 5,047,273 226,816 595,659
(incl. roads, parking, office, etc.)

Total growing space ............. .sq ft 1,195,519 4,420,615 123,536 369,630
--percent of total nursery area (Table 1F/1G) % 82.2 87.6 54.5 62.1

Propagating & finishing space ........ .sq ft 751,338 2,670,130 72,977 217,317
--percent of total growing space (Table 1D/1F) % 62.8 60.4 59.1 58.8

Stock plant space .............. sq ft 444,182 1,750,486 50,559 152,313
--percent of total growing space (Table 1E/1F) % 37.2 39.6 40.9 41.2



Appendix Table 3b--Labor Use Indicators, South Florida Foliage Nurseries, 1989.
All Largest Smallest Most Profit Your
unit 31 firms 7 firms 10 firms 9 firms Nursery
--------------------- f-M-------- ---------- W---- -------- -------------------- --------- --------

Plant sales per person* .... (Table 1A/1I) $ 42,450 42,000 34,289 46,195
Value of production per person* (Table 1C/11) $ 44,428 41,176 36,400 63,795

Growing area per person*. . (Table 1F/11) sq.ft. 41,564 45,897 31,922 22,144
Persons per acre growing area (Table 1F/1G) number 1.05 0.95 1.36 1.97

- Full-time equivalent person (2080 hr/year)
-----------------------------------------------------------------------------
*Full-time equivalent person (2080 hr/year)


23








24 Central and South Florida Foliage Nurseries, 1989


Appendix Table 4b--Capital Use Indicators, South Florida Foliage Nurseries.
All Largest Smallest Most Profit Your
unit 31 firms 7 firms 10 firms 9 firms Nursery
----------------------------------------W-------mt~w_- --- ----------------
Owned capital turnover. . (Table 1A/1Q) % 76.9 85.3 54.6 64.0
Managed capital turnover. .(Table 1A/1AC) % 70.1 78.1 43.4 56.8

Capital owned/person* . . (Table 1Q/11) $ 55,174 49,238 62,746 72,220
Capital managed/person* . .(Table 1AC/1I) $ 60,550 53,746 78,987 81,341

---Managed Capital Per Person In---
Growing plants. ....... (Table 1V/1I) $ 26,563 22,808 23,859 42,944
Bldgs, improvements ..... (Table 1W/11) $ 6,626 5,904 9,060 13,169
Machinery & equipment .... (Table 1X/1I) $ 2,559 2,307 4,361 2,905
Land. ............ (Table 1Y/1I) $ 12,935 9,855 35,371 12,717

Capital owned/acre. ..... (Table 1Q/1G) $ 57,824 46,731 85,622 142,063
Capital managed/acre. ..... .(Table 1AC/1G) $ 63,457 51,009 107,784 160,006

---Managed Capital Per Acre In---
Growing plants. ....... (Table 1V/1G) $ 27,838 21,647 32,558 84,476
Bldgs, improvements ..... (Table 1W/1G) $ 6,944 5,603 12,363 25,905
Machinery & equipment .... (Table 1X/1G) $ 2,682 2,190 5,951 5,714
Land. .. ........... (Table 1Y/1G) $ 13,556 9,353 48,267 25,016

---Distribution of Managed Capital---
in growing plants ..... .(Table 1V/1AC) % 43.9 42.4 30.2 52.8
in buildings & wells. ... .(Table 1W/1AC) % 10.9 11.0 11.5 16.2
in machinery & equipment. .(Table 1X/1AC) % 4.2 4.3 5.5 3.6
in land .......... .(Table 1Y/1AC) % 21.4 18.3 44.8 15.6
in supply inventory ... ..(Table 1Z/1AC) % 1.2 1.3 1.4 1.5
in accounts receivable. . (Table 1AA/1AC) % 15.7 19.7 5.3 8.2
in cash/checkbook balance .(Table 1AB/1AC) % 2.7 2.9 1.3 2.1
--------------------------------- ------- -
TOTAL ... ... ............ %. 100.0 100.0 100.0 100.0


Full-time equivalent person (2080 hr/year)








Central and South Florida Foliage Nurseries, 1989


Appendix Table 5b--Costs by Expense Category, South Florida Foliage Nurseries, 1989.


ALL Largest Smallest Most Profit Your
unit 31 firms 7 firms 10 firms 9 firms Nursery
---------------------------- m --- ---W --------- ---ft --------------- ----- W-------
Operator's salary ........... $ 68,777 153,255 25,041 63,771
Other wages .......... .. ...... $ 399,775 1,415,238 38,072 186,143

LABOR TOTAL ............ ... $. 468,553 1,568,493 63,112 249,913


Plants & seeds. ...... .... ....
Containers. . ... . . . . .
Heating fuel. ......... . . .
Peat & soil .... ..... . .....
Fertilizers & lime. ..... .....
Pesticides & chemicals ... .. .. ..
Packaging & shipping supplies ......
Other production supplies . . . . .

SUPPLIES TOTAL. .... .. . .... ...

Facility repairs. . . . . . . .
Equipment operation . . . . . .


OTHER PRODUCTION COSTS TOTAL. .. . .


Travel . . . . .. . . .
Insurance . ........ ...... .. .
Telephone ................
Electricity . . . . . . . .
Taxes & Licenses. . ... . ......
Advertising ........... ....
Rent-land/buildings . .........
Other cash costs. .. .. .. . . .

ADMINISTRATIVE & OVERHEAD COSTS TOTAL .

TOTAL CASH COSTS . .. .. . .

Depreciation-machinery/equipment. .....
Depreciation-buildings/etc. . . . .
Supply inventory decrease . ... .
Interest on capitaL*. ........ . .

TOTAL NON-CASH COSTS . . . . .

TOTAL ALL COSTS. .. . .. .. .


$
$
$
$
$
$
$
$

$

$
$


$


$
$
$
$
$
$
$
$

$

$

$
$
$
$

$

$


157,188
58,770
10,013
46,576
32,183
35,259
45,627
45,101

430,716

35,997
17,764

53,761

16,167
17,551
13,351
8,232
11,062
13,667
9,664
91,526

181,219

1,134,249


433,054
203,797
38,345
154,893
114,372
127,144
162,665
174,947

1,409,218

122,661
57,599

180,260

55,237
51,400
39,234
24,751
36,804
52,138
34,423
352,504

646,490

3,804,461


18,944 65,914
51,240 174,788
0 0
190,439 569,086

260,623 809,788

1,394,872 4,614,249


17,116
7,989
369
5,742
3,981
3,025
3,906
2,910

45,038

2,555
4,169

6,724

2,162
3,362
2,139
2,148
2,340
931
1,988
5,776

20,845

135,719

2,919
6,549
0
29,139

38,607

174,326


142,227
27,148
4,309
22,171
11,961
11,925
27,808
26,922

274,471

14,600
11,059

25,660

13,178
16,235
7,891
5,027
5,845
9,340
4,515
45,908

107,939

657,983

10,776
54,321
0
144,658

209,755

867,738


* Note: Interest on capital is 12% charge on owned capital value.


25


------------------ ---------









26 Central and South Florida Foliage Nurseries, 1989


Appendix Table 6b--Costs Per Dollar's Worth of Production, South Florida Foliage Nurseries, 1989. *
----------------------------------------
ALL Largest Smallest Most Profit Your
unit 31 firms 7 firms 10 firms 9 firms Nursery
----------- M --------- ------------------------- ---------_Mw------ W--W---------------------
Operator's salary ............. cents 5.4 3.9 17.8 6.0
Other wages ................. cents 31.3 35.7 27.0 17.5

LABOR TOTAL ....... ....... cents 36.7 39.5 44.8 23.5

Plants & seeds. .............. cents 12.3 10.9 12.2 13.4
Containers ................. cents 4.6 5.1 5.7 2.5
Heating fuel ............. cents 0.8 1.0 0.3 0.4
Peat & soil ................ cents 3.6 3.9 4.1 2.1
Fertilizers & time. ............ cents 2.5 2.9 2.8 1.1
Pesticides & chemicals. .......... cents 2.8 3.2 2.1 1.1
Packaging & shipping supplies ....... cents 3.6 4.1 2.8 2.6
Other production supplies ......... cents 3.5 4.4 2.1 2.5

SUPPLIES TOTAL. ..... .... ..... cents 33.7 35.5 32.0 25.8

Facility repairs. ............ cents 2.8 3.1 1.8 1.4
Equipment operation ............ cents 1.4 1.5 3.0 1.0

OTHER PRODUCTION COSTS TOTAL. ....... cents 4.2 4.5 4.8 2.4

Travel. ................... cents 1.3 1.4 1.5 1.2
Insurance ................. cents 1.4 1.3 2.4 1.5
Telephone ................. cents 1.0 1.0 1.5 0.7
Electricity ................ cents 0.6 0.6 1.5 0.5
Taxes & licenses. ............. .cents 0.9 0.9 1.7 0.5
Advertising ................ cents 1.1 1.3 0.7 0.9
Rent-Land/buildings ............ cents 0.8 0.9 1.4 0.4
Other cash costs. ............. cents 7.2 8.9 4.1 4.3

ADMINISTRATIVE & OVERHEAD COSTS TOTAL . cents 14.2 16.3 14.8 10.1

TOTAL CASH COSTS .... ... .... cents 88.8 95.9 96.3 61.8

Depreciation-machinery/equipment ..... cents 1.5 1.7 2.1 1.0
Depreciation-buildings/etc ......... cents 4.0 4.4 4.6 5.1
Supply inventory decrease ......... cents 0.0 0.0 0.0 0.0
Interest on capital ............ cents 14.9 14.3 20.7 13.6

TOTAL NON-CASH COSTS .. .......... cents 20.4 20.4 27.4 19.7

TOTAL ALL COSTS .............. cents 109.2 116.3 123.8 81.5

Production is annual sales plus inventory change.
Production is annual sales plus inventory change.




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