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Business analysis of foliage plant nurseries in Dade County, Florida
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 Material Information
Title: Business analysis of foliage plant nurseries in Dade County, Florida
Series Title: 1987- Florida nursery business analysis series
Portion of title: Foliage plant nurseries in Dade County, 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., Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida
Place of Publication: Gainesville
Creation Date: 1988
Frequency: annual
regular
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Subjects / Keywords: Foliage plant industry -- Economic aspects -- Periodicals -- Florida   ( lcsh )
Nurseries (Horticulture) -- Economic aspects -- Periodicals -- Florida   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
serial   ( sobekcm )
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General Note: Description based on: 1984; title from cover.
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oclc - 23593531
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System ID: UF00014561:00001
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Table of Contents
    Front Cover
        Page i
    Acknowledgement
        Page ii
    Table of Contents
        Page iii
        Page iv
        Page v
        Page vi
    Main
        Page 1
        Page 2
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
        Page 8
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        Page 16
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
    Appendix
        Page 23
        Page 24
        Page 25
        Page 26
        Page 27
        Page 28
        Page 29
        Page 30
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Full Text
l 1
December 1989


Circular 876


Business Analysis of
Foliage Plant Nurseries in
Dade County Florida,1988


J. Robert Strain
Alan Hodges
DeArmand Hull


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




/oJ

I5i 1 SCIENCE
&CKc. LIBRARY
ACKNOWLEDGEMENTS
This report was made possible by the cooperating Dade County foliage nursery operators who made
available their production and accounting records on a confidential basis for analysis and averaging.
Acknowledgement and appreciation of the help received, however, does not alter the fact that errors in the
analyses or in the interpretation of the information presented herein are the sole responsibility of the authors.






Dade County Foliage iii


TABLE OF CONTENTS


Page
LIST OF FIGURES .......................................................... v
LIST OF TABLES .. .................... ..................................... v
LIST OF APPENDIX TABLES ...................... .......................... vi

INTRODUCTION .... ......... ....... ................... ................. 1
PROCEDURE ........... ............... ..... ....................... ....... 1
DATA AND RESULTS ................................................ ....... 2
Size of Business ................... ...................................... 2
Sales and Total Value of Production ....... .............. .... ....... ........... 2
Annual sales .................. ... ......... ...... ................... 2
Monthly sales ........................................................ 2
Land, Labor and Capital ................... .............................. 4
Land: bed and bench space ..................................... .......... 4
Labor: full-time equivalent persons ......................................... 4
Capital: owned and managed. ............... ........... 4
Productivity Indicators ....... ..... .. ................................ 6
Land Use ............ .................................... .............. 6
Labor Use ........................................ ...................... 7
Capital Use ...................................... ...................... 8
Capital turnover ................... .................................... 8
Capital managed per person ............................... ....... 8
Capital managed per acre ................................................ 8
Distribution of managed capital ............................................ 11
Costs of Production ................... ..... .............. ................... 11
Costs by Expense Category ........................................ ..... 11
Salaries and wages ................. ............... ............. 11
Production supplies ... .............. ................. .... ... ....... 11
Other production costs ................................................ 11
Administrative and overhead ............................................. 11
Total cash costs ............................................. . . 11
Non cash costs ................ .............. ........ ........ ..... 11
Total costs ...................................................... . ... 11
Costs as a Percent of the Total Cost ................................... ...... 12
Salaries and wages ................. ................. ............. 12
Production supplies .................................................... 12
Other production costs .............................................. 12
Administrative and overhead ............................................ 12
Total cash costs .......................................................... 12
Non cash costs .......................................................... 12
Cost Efficiency .......................................................... 13
Cost Per Square Foot of Bed and Bench Space .................................. 13
Cost Per Square Foot of Propagating and Finishing Space . . . . . . . . . . . . .. .. 13
Cost Per Dollar's Worth of Production ....................................... 15
Cost Per Dollar's Worth of Sales ...............................................15







Dade County Foliage


TABLE OF CONTENTS (Continued)


Income Summary ........
Total Gain ...........
Cost Deductions and Net Nt
Return on Capital .....
Statement of Financial Position
Assets ..............
Cash on hand ......
Accounts receivable
Inventory values .....
Total current assets
Long term assets ....
Total assets ........
Liabilities ...........
Current liabilities ....
Long term liabilities .
Total liabilities ......
Net Worth ...........
Total Profitability Model . .
Margin Management ....
Asset Management .....
Leverage Management
CONCLUDING COMMENTS .
APPENDIX ..............
Definitions .............
Making your own calculations
Appendix Tables ..........


..o..........

rsery Income .


.....o..o...

. . . o.. o . .
. aoo o a. . 0. .ao .
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iv







Dade County Foliage


LIST OF FIGURES


Figure


1 Sales and Total Value of Production ...........
2 M monthly Sales ...................... . .
3 Land: Bed and Bench Space ................
4 Labor: Number of Persons .................
5 Capital Managed ........................
6 Land Use: Value of Production Per Square Foot .
7 Labor Use: Value of Production Per Person .....
8 Capital Turnover .......................
9 Capital Managed Per Person ...............
10 Capital Managed Per Acre .................
11 Distribution of Managed Capital .............
12 Distribution of Costs of Production ...........
13 Costs Per Square Foot of Bed and Bench Space .
14 Costs Per Square Foot of Propagating and Finishing
15 Costs Per Dollar's Worth of Production ........
16 Cash Costs Per Dollar's Worth of Sales ........
17 Distribution of Total Gain .................
18 Return to Capital ........................
19 Assets and Liabilities .....................
20 Total Profitability Model ..................


a 0o o
0o o 0o o
. . . .
...o..o
o o o o
Spa.ce
. o oo0 .
....o..







Space .







..oo..o


LIST OF TABLES


Table


1 Sales, growing area, people and capital, 25 foliage nurseries in Dade Co. Florida, 1988 .......
2 Costs of production, 25 foliage nurseries in Dade Co. Florida, 1988 .....................
3 Income summary, 25 foliage nurseries in Dade Co. Florida, 1988 ......................


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Page


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0 0 0 0 0 0

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0 0 0 0 0







Dade County Foli


LIST OF APPENDIX DATA TABLES
Appendix Table F

1 Size of business, 25 foliage nurseries in Dade Co., Florida, 1988 ........................
2 Rates of production, 25 foliage nurseries in Dade Co., Florida, 1988 .....................
3 Land use indicators, 25 foliage nurseries in Dade Co., Florida, 1988 . . . . . . . . . . .
4 Labor use indicators, 25 foliage nurseries in Dade Co., Florida, 1988 .....................
5 Capital use indicators, 25 foliage nurseries in Dade Co., Florida, 1988 ....................
6 Costs by expense category, 25 foliage nurseries in Dade Co., Florida, 1988 .................
7 Percent of total costs by expense category, 25 foliage nurseries in Dade Co., Florida, 1988 ......
8 Costs per square foot of bed and bench space, 25 foliage nurseries in Dade Co., Florida, 1988 . .
9 Costs per square foot of propagating and finishing space, 25 foliage nurseries
in Dade Co., Florida, 1988 .................................................
10 Costs per dollar's worth of production, 25 foliage nurseries in Dade Co., Florida, 1988 ........
11 Cost per dollar's worth of sales (no adjustment for change in plant
inventory), 25 foliage nurseries in Dade Co., Florida, 1988 ..........................
12 Income summary, 25 foliage nurseries in Dade Co., Florida, 1988 . . . . . . . . . . . .
13 Statement of financial position, 25 foliage nurseries in Dade Co., Florida, 1988 ..............
14 Financial ratios and other profitability indicators, 25 foliage nurseries in Dade Co., Florida, 1988 .


vi






Dade County Foliage


BUSINESS ANALYSIS OF FOLIAGE NURSERIES IN DADE COUNTY, FLORIDA, 19881
J. Robert Strain, Alan Hodges and DeArmand Hull2


INTRODUCTION
This publication contains information on sales,
costs, returns and production efficiency for 25
wholesale foliage plant nurseries in Dade County
Florida for 1988. Other publications in the Florida
Nursery Business Analysis series include reports on
central Florida foliage plant nurseries, south Florida
foliage plant nurseries, woody ornamental field
nurseries, and woody ornamental container nurseries.
Purposes of the nursery business analysis series
include:

1) Furnishing nursery operators with various
physical and economic measures for evaluating the
efficiency of individual nurseries, and for making
more informed management decisions.

2) Providing individuals considering entering the
wholesale ornamental plant production business with
an estimate of the input requirements and revenue
potential.

3) Providing industry investors with representative
measures of average business performance.

4) Providing Florida extension personnel with
business information for conducting educational
programs with nursery operators.


PROCEDURE
The information and averages presented in this
report are based on data supplied by nursery
operators in the form of confidential production and
accounting records. They participated in the
program voluntarily and do not represent a
statistically selected sample. However, the nursery
operators participating in the Florida Nursery
Business Analysis Program are thought to represent
some of the more efficient foliage plant nurseries in


south Florida, rather than being typical of the foliage
plant industry. Participating firms were located in
the Florida counties of Dade, Broward, and Palm
Beach.

Data were collected for the 1988 tax year. In
most cases, this was for January through December.
For others, data for fiscal years ending after July 1,
1987, and before July 1, 1989, were included as 1988
data.

Not all nursery operators received a regular salary
from their operation. In these cases, an estimate of
the value of the time of the operator was collected
and used in the analysis in order to provide a more
equitable basis for comparing data. For the same
reason, interest expense paid by the individual
nursery operator was excluded from the costs listed
in this report, and instead, an interest charge for the
total owned investment was included as a non-cash
cost, calculated at the rate of 12 percent per year.

The owned capital investment reflects the
depreciated book value of buildings, improvements,
machinery and equipment. Growing plants also are
included as a part of the owned capital investment,
at a value reflecting their average wholesale price,
and discounted in proportion to the percentage of
completion. In the absence of detailed cost
accounting records, a commonly accepted method of
evaluating inventory for an ongoing concern is to
value all plants at 50 percent of their wholesale price
when finished. Some nursery operators use slightly
different methods, and for this report the values
received from operators were the values used. Land
included in owned capital investment was valued at
the original purchase price. Although this represents
the actual investment in a nursery operation, it may
not reflect the replacement cost, particularly for
older firms.

The tables and figures present average values for


1. This document was published as Economic Information Report 269, Florida Cooperative Extension Service, Institute of Food and
Agricultural Sciences, University of Florida, Gainesville, December 1989.
2. J. Robert Strain is an Extension Economist and Alan Hodges is an Economist Analyst, both in IFAS, Food and Resource Economics
Department, Gainesville, FL 32611, and DeArmand Hull is a commercial Ornamentals Extension Agents. IFAS, Dade County, FL.






Dade County Foli


all 25 nurseries, for the average of the largest 8
firms, and for the smallest 8 firms. All firms in the
largest group had sales of own plants greater than
$750,000, while all firms in the smallest group had
sales less than $250,000. On charts where lines
appear indicating the range of data, the upper line
designated "highest rates" represents the average of
the highest third of firms (8) for the particular
measure, and the lower line designated "lowest rates"
is the average for the lowest third (8). Nursery
operators received an analysis for their own
operation, which contained similar information as
used in this report, shortly after submitting data.


DATA AND RESULTS
The key findings of this report appear in the text
in the form of charts and graphs. The data from
which they were derived may be found in the
appendix tables at the end of this report. The
appendix tables include notations on calculations
involved for those who may wish to examine some
figures in further detail, and spaces are provided for
entering figures pertaining to your own firm for
comparison. Where tables appear in this report,
arithmetic inconsistencies from rounding may be
noted.

Size of Business
Appendix Table 1 (summarized in Table 1)
presents basic information on size of business and
scale of production operations. When combined
with costs of production in Appendix Table 6, these
data provide the basis for developing most of the
measures and indicators shown in the other tables
and figures in this report.

Sales and Total Value of Production
Annual sales. Sales figures used in this analysis
represent only plants produced by the nursery firm
itself. In other words, if any plants were purchased
for immediate resale, or "brokered," their value was
deducted from total sales to give the value of own
plants sold. Figure 1 illustrates the differences in
the sizes of the industry average, largest, and
smallest foliage plant nurseries. Own plant sales
averaged $1,417,627 for all nurseries, $3,752,542 for
the largest nurseries, and $138,615 for the smallest
nurseries (Table 1).


Total value of production during the year adji
sales for change in the value of the plant invent(
Plant inventory increased for the average of
nurseries by $17,668, and for the smallest nurse:
by $18,455. For the largest firms, plant invent
decreased by $1,788. Thus, sales plus plant invent
change gives a total value of production
$1,435,295 for all nurseries, $3,750,754 for
largest, and $157,070 for the smallest (Table 1).

Monthly sales. Figure 2 shows the pattern
monthly sales for all nurseries, largest nurseries -
smallest nurseries. For all nurseries, highest st
occurred during the months of January, Mai
April, and May. Sales for these months account
for 38 percent of the year's total sales. Sales
April, the highest month, averaged $150,225, wl
was 45 percent greater than those for November,
lowest month ($103,378).






Dade County Foliage 3

Table 1--Sales, bed and bench space, people, and capital: 25 foliage nurseries in Dade Co., Florida, 1988


Atl 25 Largest Smallest
unit Nurseries Third (8) Third (8)
-a-eofow-pans -od.......--- 1,417,6270-- 3,752,54 138,615---- ----M- ----


Value of own plants sold . . . .
Change in inventory value . . .

Total value of production . . .


. . 1,417,627
. . $ 17,668

. . $ 1,435,295


Total bed and bench space. . . . . .sq.ft. 728,025


Full-time equivalent persons .. . . .number


28.00


Total Owned Capital. . . . . . ... S 1,533,404
Total Leased Capital . . . . . .. $ 136,413

Total Managed Capital. . . . . ... S 1,669,816


3,752,542
(1,788)

3,750,754

1,940,839

71.31

3,769,663
245,688

4,015,350


138,615
18,455

157,070


71,614

4.00


265,871
31,750

297,621


I Figure 1 I


Sa les and Tota I


25 Dade Co.


Value


Fla. Foliage


of Production


Nurseries,


1988


All Nurseries Largest Third Smallest Third


M Sales Value of Production


4.00


3.00


2.00


1.00


0.00






Dade County Foliage


Land, Labor and Capital

Land: bed and bench space. Total bed and bench
space averaged 728,025 square feet for all nurseries,
1,940,839 square feet for the largest nurseries, and
71,614 square feet for the smallest (Table 1 and
Figure 3). Propagating and finishing space (that
portion of bed and bench space used to grow plants
for sale) averaged 703,664 square feet for all
nurseries, 1,909,914 square feet for the largest
nurseries, and 66,578 square feet for the smallest
nurseries. Stock plant area is bed and bench space
used exclusively for production of plant propagating
material. This area averaged 24,361 square feet for
all nurseries, 30,925 square feet for the largest firms,
and 5,036 square feet for the smallest nurseries.
Total nursery area, which includes drives, roads,
parking lots, office, packing house, and the like,
averaged 21.1 acres for all nurseries, 53.3 acres for
the largest firms, and 2.7 acres for the smallest.

Labor: full-time equivalent persons. The number
of full-time equivalent persons involved in the
nursery operation is obtained by dividing total labor
hours, including the time of salaried non-hourly
workers and managers, by the number of hours in a


normal working year (40 hours per week times 52
weeks per year equals 2,080 hours). Average
number of full-time equivalent persons involved for
all nurseries was 28.0, for the largest it was 71.3, and
for the smallest nurseries it was 4.0 (Table 1 and
Figure 4).

Capital: owned and managed. Capital owned is
the current value (original cost less depreciation) of
capital assets in the nursery operation, including
plants in inventory, equipment, buildings, land,
accounts receivable, and cash on hand. Capital
owned averaged $1.533 million for all nurseries,
$3.770 million for the largest firms, and $265,871 for
the smallest. Related debt is not deducted in this
determination of the value of capital owned.

Capital managed is the value of capital owned
plus the value of additional capital items used and
under the control of the manager, such as leased
property. Capital managed averaged $1.670 million
for all nurseries, $4.015 million for the largest
nurseries, and $297,621 for the smallest nurseries
(Table 1 and Figure 5).


Figure 2

Monthly Sales
25 Dade Co. Fla. Foliage Nurseries, 1988

Do II ars CThousandsD
500


400


300 -.------ ----- ......- Largest
A I I Nurseries
200 -sm................. ................................. ............................ ... sna I lest

100 ... ........ ................. ....


0Month

Month






Dade County Foliage


Land:
25 Dade Co.


Figure 3

Bed and Bench Space
Fla. Fol age Nurseries, 1988


AII Nurseries


Largest Third


--- i-- I"S------l-%st Th- I rIII d -


Labor
25 Dade Co.


Figure 4

Number of Persons
Fla. Foliage Nurseries, 1988


Ful I-time Equiv, Persons (2080 nrs/yr)
I


All Nrei LI1U+2t-


2.50


2.00


1.50


1.00


0.50


0.00


80



60



40


20 1-


0


...................................................


......................................................


.....................................................................


........................~~.............................


Sma I lest Third


All Nurseries


Largest Third






Dade County Foliage


Figure 5
Capital Managed
25 Dade Co. Fla. Foliage Nurseries, 1988

Do I lars CMi II ions)
cz n .I


4.0 ..

3.0 -

2 .0 ........................


1.0 1-


All Nurser es Largest Third Sma llest Third


^ Capital Leased
liH CaptalI Owned


Capital managed


Productivity Indicators

Land Use (Appendix Table 2)
The traditional indicator of efficiency in the use
of land is value of sales per square foot of bed and
bench space. However, value of production is a
truer indicator of long term productivity. Value of
production is annual sales of own plants adjusted for
change in the value of plant inventory. Average
value of production per square foot of propagating
and finishing space was $2.04 for all nurseries, $1.96
for the largest firms, and $2.36 for the smallest.

Value of production per square foot of total bed
and bench space (includes stock plant space) was
$1.97 for all nurseries, $1.93 for the largest firms,
and $2.19 for the smallest (Figure 6). Firms with
the highest annual rates of production averaged
$5.48 per square foot, while those with the lowest
averaged $1.18 per square foot.

In terms of value of production per acre of total
nursery area (includes non-growing areas such as
office, parking, packing house, walkways, driveways),
the average for all nurseries was $68,117, for the


is owned plus


leased.


largest nurseries, $70,396, and for the smallest
nurseries, $58,745.

In general, increased sales per square foot of
production area will increase the profitability of a
nursery operation. However, this does not assure
high profitability. Lower sales per square foot of bed
and bench space can result from a number of things:
plants remaining after reaching salable size, high
amount of vacant space, slow-growing plant varieties,
and disease and quality problems that reduce yields
of salable plants. In addition, nursery layout and
fertilizing and growing techniques can alter the time
and space used for the same crop in two different
nurseries.

Plant inventory value per square foot in
production is another indicator of efficiency in the
use of space. This averaged $1.05 for all nurseries,
$0.93 for the largest nurseries, and $1.18 for the
smallest nurseries. For ongoing operations, low
plant inventory values per acre imply either
inefficient use of land or unwise selection of crops
grown in terms of the relationship between their
price and growing area requirements.


0.0






Dade County Foliage


Figure 6


Land Use: Value
25 Dade Co. Fla.


6.00

5.00

4.00

3.00

2.00

1.00

0.00


Do I lars/Sq.Ft.


Al Nurseries Largest


Additional indicators of efficiency in the use of
land include turnover of plant inventory, the share of
total nursery area in bed and bench space, the share
of bed and bench space used for stock plants, and
the average percentage of bed and bench space that
is vacant. Average turnover of the plant inventory
was 186 percent. This means that annual plant sales
amounted to almost 1.9 times the average value of
plant inventory. The largest nurseries had plant
inventory turnover of 207 percent, and the smallest
nurseries had 164 percent. Vacant bed and bench
space averaged 6.0 percent of the total for all
nurseries (Appendix Table 4).

Labor Use (Appendix Table 3).
Value of production per full-time equivalent
person (2080 hrs/year) is one of the best measures
of efficiency in the use of labor. This indicator
averaged $51,256 per person for all nurseries,
$52,600 for the largest firms, and $39,303 for the
smallest (Figure 7). Highest rates of production per
person averaged $78,433 per person, and lowest rates
were $31,330.

An indicator of intensity in the use of labor is
production area per person. Total bed and bench


of Production/Sq.
Foliage Nurseries, 1


Ft.
988


--- Highest Rates
"* Lowest Rates


Sma I lest


space per full-time equivalent person averaged 25,999
square feet for all nurseries, 27,218 square feet for
the largest firms, and 17,920 square feet for the
smallest. Stated another way, the number of persons
per acre of bed and bench space averaged 1.33 for
all nurseries, 1.34 for the largest nurseries, and 1.49
for the smallest nurseries.

If all other things are equal, higher sales per
person involved is desirable, but this measure should
be viewed together with other indicators, such as
production rate, space use intensity, capital turnover,
and costs per square foot. High sales per person
can be less than optimal if the number of persons is
too small for the volume of plants handled or space
tended, resulting in low space use efficiency, poor
plant care, or lower product quality.

Lower sales per person can result during periods
of rapid expansion when extra help is needed before
plants reach salable size. Lower sales per person
can also result during difficult economic times when
sales are slow. Variations among nurseries can be
the result of differences in investment in labor saving
capital items, labor management practices, or other
practices affecting crop turnover rate.


7






Dade County Foliage


Figure 7

Labor Use: Value of Production/Person
25 Dade Co. Fla. Foliage Nurseries, 1988


Dollars/Employee Equivalent


-........


0
AlI NurserTes Laroest


CThousands)






n** HIghest Rates
Lowest Rates


Sma I lest


Capital Use (Appendix Table 5)

Capital Turnover. Annual turnover of owned
capital value is the percentage that results from
dividing the value of own plants sold by the value of
capital owned. Capital turnover for all nurseries
averaged 92.4 percent, for the largest nurseries 99.5
percent, and for smallest 52.1 percent (Figure 8).
This means that for the average of all nurseries and
largest nurseries, annual sales were nearly equal to
the capital investment, and for the smallest nurseries,
sales were about one half of capital invested in the
nursery. Highest capital turnover rates averaged 123
percent and lowest rates averaged 40 percent.

In general, larger percentage turnover numbers
are desirable, for they indicate greater sales per
dollar of investment in the nursery. Problems that
lower turnover rate include any of the items already
mentioned that lower production rate, and therefore
lower sales volume for a given nursery investment.
Low capital turnover is particularly common in
nurseries just getting started, or in nurseries that are
expanding rapidly. Excessive investments in land,
labor saving machinery and equipment will also tend
to lower the captial turnover rate.


Capital Managed Per Person. Capital owned plus
the value of capital items leased make-up the total
capital managed in a nursery. Capital managed per
full-time equivalent person averaged $59,631 for all
nurseries, $56,310 for the largest nurseries, and
$74,472 for the smallest nurseries (Figure 9).
Highest rates for capital managed per person
averaged $105,573, and lowest rates were $47,772
(Figure 9).

Capital Managed Per Acre. Capital managed per
acre of total nursery area averaged $79,247 per acre
for all nurseries, $75,362 for the largest firms, and
$111,312 for the smallest firms (Figure 10). Highest
rates of capital managed per acre were $192,171 and
lowest rates averaged $66,185 (Figure 10).


100


80


60


40


Y


8






Dade County Foliage


Figure 8

Capital Turnover
25 Dade Co. Fla. Foliage Nurseries, 1988


Sales as a Percentage of Capital Owned


140%

120%

100%

80%

60%

A40%

20%

0%


.... .. ................................................................. .......................'..-..........







... .. .. .. ... .. .. .. s.. r.. .. ... .. .. .. ... .. .. .. ... .. .. .. ... .. .. .. ..


- Highest Rates

Lowest Rates


Figure 9

CapitalI Managed Per Person
25 Dade Co. Fla. Foliage Nurseries, 1988


Dol lars per Person (Thousands)
120 1

100 .............................................

8O0 ........... ................................................................................................

-- Highest Rates
0Lowest Pates

40 -

20 .


A I Nurser lies Largest Srm I lest


9






Dade County Foliage


Figure 10

Capital Managed Per Acre
25 Dade Co. Fla. Foliage Nurseries, 1988


Do ar/c C -uA


200



150



100



50



0


Al INursriesLsrest rr~lles


-- Highest Rates

Lowest Rates


Figure
Distribution of Mv
25 Dade Co. Fla. Foliz










Land 16.56%



Machinery & Equip. 4.0%
Buildings & instal. 17.0%


11
managed Capita I
age Nurseries, 1988


Plants 45.8%


Accounts receTvable 14.0%


Supplies & Cash 2.6%


Includes capital owned
plus capital I leased


.. . . . . . . . . ... . . . . . . . .


10


Do I I ars/ Acre


CThousandsD


A I Nurser I e Largest


Sma II est






Dade County Foliage


Distribution of Managed Capital. The
distribution of the capital investment among land,
buildings, equipment, etc., is an important area of
concern in management. Figure 11 indicates the
percentage distribution of total capital managed for
the average of all foliage nurseries in 1988. Growing
plants represented the largest share of capital
managed, 45.8 percent. Next in importance were
land (16.6 percent), buildings and installations (17.0
percent), accounts receivable (14.0 percent), and
machinery and equipment (4.0 percent). Other
lesser areas of capital managed were supplies (0.8
percent), and cash on hand (1.8 percent).

Costs of Production
For the purposes of this report, costs of
production include not only cash outlays but also
non-cash costs and allowances that must be covered
over time if the business is to remain viable. The
itemized budget for cash expenses presented in
Appendix Table 6 and summarized in Table 2 of this
report is considered to be a minimal analysis of the
costs of production involved in a foliage nursery
enterprise. Included as a non-cash cost is an
allowance for a minimum return on investment. The
interest rate used here is 12 percent.

Costs by Expense Category (Appendix Table 6).
Costs by expense category were summarized from
the annual profit and loss statement or tax records
of the participating nurseries. The cost categories
were grouped into wages and salaries, production
supplies, other production costs, administrative and
overhead, and non-cash costs. These figures provide
benchmarks for the relative magnitude of various
cost items, and may provide guidance for persons
evaluating a Florida foliage nursery, either as a
buyer, seller, or lender.

Salaries and wages. The average for salaries and
wages includes the operator's salary or time value,
employees' wages, salaries, benefits, and other
payroll costs. As mentioned earlier, in some cases
the operator's salary was zero or was not
appropriate, so a time-value was estimated based
upon the operator's expected earnings, or previous
experience. The operator's salary or time value
averaged $68,419 for all nurseries, $146,851 for the
largest nurseries, and $22,113 for the smallest
nurseries. Wages, salaries, and associated expenses


for employees averaged $431,176 for all nurseries,
$1,153,708 for the largest, and $35,098 for the
smallest. Thus, total expenses on wages and salaries
averaged $499,595 for all nurseries, $1,300,559 for
the largest, and $57,211 for the smallest nurseries
(Table 2).

Production supplies. Expenses for production
supplies include plants and seeds, containers,
production heat, peat and soil, fertilizer and lime,
pesticides and chemicals, packing and shipping
materials, and other production supplies. Expenses
for supplies for all nurseries averaged $611,718, for
the largest nurseries $1,693,518, and for smallest
nurseries $44,829.

Other production costs. Other production costs
are facility repairs/maintenance and equipment
operating costs. For all nurseries they averaged
$62,193, for the largest nurseries $164,220, and for
the smallest $6,471.

Administrative and overhead. Administrative and
overhead expenses usually cannot be assigned to any
particular crop or growing activity, yet must be
covered in order to remain in business. These
expenses includes travel/trade shows, insurance,
telephone, electric power, advertising, rent, and other
cash expenses. Administrative and overhead
expenses averaged $148,537 for all nurseries,
$361,192 for the largest, and $17,102 for the
smallest.

Total cash costs. Total cash costs, including all
items mentioned above, averaged $1,322,043 for all
nurseries, $3,519,488 for the largest, and $125,613 for
the smallest nurseries.

Non-cash costs. Non-cash costs include
depreciation allowances on capital assets, decreases
in supply inventory (using supplies purchased during
a previous time period), and an interest charge for
the use of the capital invested in the nursery. These
costs averaged $256,537 for all nurseries, $639,060
for the largest, and $48,021 for the smallest firms.

Total all costs. The sum of all cash costs and
non-cash allowances averaged $1,578,581 for all
nurseries, $4,158,548 for the largest, and $173,635 for
the smallest nurseries.


11






Dade County Foliage


Table 2--Costs of Production: 25 foliage nurseries in Dade Co., Florida, 1988


ALL 25 Largest Smallest
Nurseries Third (8) Third (8)
LABOR TOTAL .................... $499,595 31.6% $1,300,559 31.3% $57,211 32.9%
SUPPLIES TOTAL. . . . . . . . . ... $611,718 38.8% $1,693,518 40.7% $44,829 25.8%
OTHER PRODUCTION COSTS TOTAL. . . . .. . . $62,193 3.9% $164,220 3.9% $6,471 3.7%
ADMINISTRATIVE & OVERHEAD COSTS TOTAL . . $148,537 9.4% $361,192 8.7% $17,102 9.8%
TOTAL CASH COSTS . . . . . . . ... $1,322,043 83.7% $3,519,488 84.6% $125,613 72.3%
TOTAL NON-CASH COSTS. . . . . . . ... $256,537 16.3% $639,060 15.4% $48,021 27.7%
TOTAL ALL COSTS . . . . . . . . $1,578,581 100% $4,158,548 100% $173,635 100%


Costs as a Percent of the Total Cost (Appendix
Table 7).
Costs in terms of percentage of the total are
more useful for comparing cost relationships with
industry averages which may represent a significantly
different size of business. Distribution of costs of
production by category for the average of all
nurseries are shown graphically in Figure 12.

Salaries and wages. Salaries and wages (includes
operator) as a percentage of total costs averaged
31.6 percent of total costs for all nurseries, 31.3
percent for the largest, and 32.9 percent for the
smallest nurseries (Table 2). The smallest nurseries
had a significantly higher percentage of costs in
operator salaries (12.7 percent) than the all nursery
average (4.3 percent), but a lower percentage in
employees wages and salaries (20.2 percent vs. 27.3
percent). Employees wages and salaries were highest
for the largest nurseries (27.7 percent).

Production supplies. Expenses for production
supplies averaged 38.8 percent of total costs for all
nurseries, and 40.7 percent for the largest nurseries.
The smallest nurseries had a substantially lower
percentage, 25.8 percent. The greatest share of
expenses for this category was "plants and seeds"
(22.8, 24.8, and 7.8 percent, respectivley). Expenses
for growing containers ranged from 3.9 to 5.7
percent, and expenses on potting soil ranged from
2.4 percent for the largest nurseries to 3.9 percent
for the smallest.

Other production costs. Other production costs
averaged 3.9 percent for all nurseries and for the
largest, and 3.7 percent for the smallest nurseries.


Administrative and overhead. Overhead costs
averaged 9.4 percent of total costs for all nurseries,
8.7 percent for the largest, and 9.8 percent for the
smallest. Thus, counter to expectations, there is no
indication of economy of scale for overhead
expenses.

Total cash costs. Total cash costs as a percent of
all costs were 83.7 percent for the average of all
nurseries, 84.6 percent for the largest nurseries. The
smallest nurseries were substantially lower, at 72.3
percent.

Non-cash costs. Non-cash costs ("depreciation"
through "interest on capital") averaged 16.3 percent
of total costs for all nurseries, 15.4 percent for the
largest, and 27.7 percent for the smallest. Thus, the
lower percentage cash costs for the smallest
nurseries were offset by their higher percentage non-
cash costs. A large share of differences in non-cash
costs was due to interest on capital: 11.7 percent for
all nurseries, 10.9 percent for the largest, and 18.4
percent for the smallest. Depreciation on
equipment, buildings, and other property
improvements was 4.6 percent for all nurseries, 4.5
percent for the largest third, and 9.3 percent for the
smallest third. These data indicate some economy of
larger scale in non-cash costs.


12






Dade County Foliage


Cost Efficiency
Costs per square foot are an important indicator
for comparing growing costs in relation to the
physical area of production. Similarly, costs per
dollar of sales and production are important
indicators for comparing growing costs with product
revenue.

Costs Per Square Foot of Bed and Bench Space
(Appendix Table 8).
These figures were obtained by dividing each of
the dollar cost figures in Appendix Table 6 by the
square feet of bed and bench space shown in
Appendix Table 1. This is growing area only, not
including offices, packing areas, drives, roadways, and
ditches, etc. Costs per square foot of bed and bench
space averaged $2.17 for all nurseries, $2.14 for the
largest, and $2.42 for the smallest (Figure 13).
Highest rates of cost per square foot averaged $5.56,
and lowest rates averaged $1.64 (Figure 13). Cash
costs per square foot (excluding depreciation,
interest, etc.) averaged $1.82 for all nurseries, $1.81
for the largest, and $1.75 for the smallest nurseries.


Cost Per Square Foot of Propagating and
Finishing Space (Appendix Table 9).
Costs per square foot of propagating and finishing
space is the most appropriate measure for estimating
individual plant growing costs or for comparing cost
efficiency between nurseries. These costs were
obtained by dividing the dollar amounts in Appendix
Table 6 by the square feet of propagating and
finishing space from Appendix Table 1. Total costs
per square foot of propagating and finishing space
showed a pattern similar to cost per square foot of
total bed and bench space. All nurseries averaged
$2.24, largest nurseries $2.17, and smallest firms
$2.61 (Figure 14). Highest rates averaged $6.26 per
square foot and lowest rates averaged $1.91 (Figure
14).

Other things being equal, a lower cost per square
foot is desirable. Problems that cause costs per
square foot to increase include inefficient planning
and utilization of labor, insufficient investment in
labor saving capital items, destruction or theft of
supplies and plants, and poor purchasing practices.
Other causes of increased costs may not be a
problem if they result in increased revenue.


13







14 Dade County Foliage


Figure 13

Costs/Square Foot of Bed & Bench Space
25 Dade Co. Fla. Foliage Nurseries, 1988


Do l ars/Sq.Ft.
6.00

5 .00 -...................................................... .............. .................

4 .00 -. H.............................................. .................................................... Highest Rates

Lowest Rates
3.00 --------------------..................--
Non-cash costs

2.00 ...................... ......................... Cash Costs

1 .00 .......... ............. ................................

0.00
Al I NurserIes Largest Sma I Iest



Figure 14

Costs/Square Foot of Prop. & Fin. Space
25 Dade Co. Fla. Foliage Nurseries, 1988


Do I Iars/ Sq.Ft.
7.00

6.00 -..... .

5.00 .............. ..... ........... ..................
H* Highest Rates
4. 00 -----------------------*- -------- -----------.- N.Lonw.s h Cate s

3 O0 .............................................................................................................. 1 Non-Cash Costs
Cash Costs
2 .00.

1.00 -...

0.00
A I I Nurser 1 esLargest Sme I lest






Dade County Foliage


Costs Per Dollar's Worth of Production (Appendix
Table 10).
Costs per dollar value of production (sales
adjusted for changes in the value of plant inventory
during the year) is a direct measure of long-term
profitability. This is calculated by dividing the dollar
costs (Appendix Table 6) by the value of own plants
sold adjusted for change in plant inventory value
(Appendix Table 1). So, a $1.00 cost per dollar
value of production represents the breakeven cost
level. Total costs per dollar value of production for
all foliage nurseries averaged $1.10. For the largest
and smallest nurseries, costs averaged $1.11 per
square foot (Figure 15). Thus, average total costs
for all nurseries were 10 percent above the
breakeven level. The deficit in costs per dollar value
of production for the industry average does not
actually represent a "loss" in this case, but merely a
failure to meet the 12 percent return allowance for
interest on capital, as will be seen in the section
"Income Summary." Current operating expenses
(cash costs) per dollar of production were $0.92 for
the average of all nurseries, $0.94 for the largest
third, and $0.80 for the smallest third. Highest rates
of costs per dollar value of production averaged
$1.46 and lowest rates were $0.87 (Figure 15).

Cash Costs Per Dollar's Worth of Sales (Appendix
Table 11).
While profitability is indicated by costs per dollar
of sales adjusted for changes in inventory value,
ability to meet current liabilities depends upon costs
relative to cash received. These figures were
developed by dividing the dollar costs shown in
Table 2 by the value of own plants sold from Table
1. All of the nursery averages covered cash costs
per dollar of sales in 1988. The average for all firms
was $0.93, for the largest nurseries $0.94, and for the
smallest firms $0.91 (Figure 16). Highest cost firms
averaged $1.14 per dollar of sales, and lowest cost
firms had cash costs of $0.76 per dollar of sales
(Figure 16).

In general, lower costs per dollar of sales are
desirable. Rising costs per dollar of sales are very
common during periods of rapid expansion, because
extra costs of a larger operation are incurred before
the nursery can experience accompanying extra sales.
During inflationary times, failure to get price
increases as fast as costs are going up will also cause
higher costs per dollar of sales.


Income Summary (Appendix Table 12)
This section concentrates on developing net
nursery income and allocating it between the time
and effort of the owner-operator and a return on
the money invested in the operation. Figure 17
shows the components of income summarized, and
Table 3 arrays the data used for the figure.

Total Gain
Total gain refers to the total value produced by
the year's operations: the sum of plant sales, changes
in plant and supply inventory values, and
miscellaneous income. Increases in inventories of
supplies averaged $1,298 for all nurseries, $459 for
the largest firms, and $2,023 for the smallest
nurseries. Miscellaneous income refers to income
received from sources other than plant sales,
including rent, interest on accounts, delivery or
packaging charges, and sales of supplies. This
averaged $11,272 for all nurseries, $23,810 for the
largest, and $159 for the smallest firms. Total gain
averaged $1,447,865 for all nurseries, $3,775,024 for
the largest nurseries, and $159,252 for the smallest.

Cost Deductions and Net Nursery Income
Total costs except the operator's salary and
allowance for interest on capital are deducted from
total gain to give net nursery income. Total
deductions averaged $1,326,153 for all nurseries,
$3,559,338 for the largest firms, and $119,617 for the
smallest.

Net nursery income is the total return for the
year to the manager and to the capital invested in
the operation. Average net nursery income was
$121,712 for all nurseries, $215,686 for the largest,
and $39,634 for the smallest nurseries.


15








Dade County Foliage


Figure 15

Costs Per Do l ar 's Worth of Production

25 Dade Co. Fla. Foliage Nurseries, 1988


Do I lars/Do I lar


:e.v.e.n.. c \c. .



....All N..se.... Largest............. S...... Sle. st








All NurseriesLargest Smal lest


*4- Highest Rates

Lowest Rates

Non-Cash Costs

Cash Costs


1.60

1.40

1.20




0.80

0.60

0.40

0.20

0.00


Figure 16

Cash Costs Per Do Ilar 's Worth of Sales

25 Dade Co. Fla. Foliage Nurseries, 1988


Do I Iars/Do I t ar
1.20



I1.-10 --------- ------



oo B ea e ve...............................................................--
Highest Rates

9 Lowest Rates
0 .90 ... . .... ....... .. .................







0.70
AHll Nurseries Largest Smallest


Ak Ank
lw %W V41F qw
............................................................................................................

............................................................................................................


16


..........................
mmmmmmmmli-
.........................

.........................

........................

.........................






Dade County Foliage


Table 3--Income Summary: 32 foliage nurseries in Dade County, Florida, 1988.


ALL 25 Largest Smallest
unit Nurseries Third (8) Third (8)

TOTAL GAIN ................. $ 1,447,865 3,775,024 159,252


Total Deductions . . . . . . .

NET NURSERY INCOME . . . . . . .
Operator's salary or time value. . . .

RETURN TO CAPITAL................
--Percent. . . . . . . . ....


$ (1,326,153)

$ 121,712
$ 68,419

$ 53,293
% 3.48


Figure 17

Distribution of Total Gain

25 Dade Co. Fla. Foliage Nurseries,


Dollars (CMill ions)
I


5.00


4. 00
4 .00 -- -----"--- ----
3. 00 ... .. . .


2.00 -..................................


1.00 -"


0.00
A ll Nurserles Largest


Return to Capital

Return to Operator

Deduct Ions


Return to Capital

From net nursery income is subtracted the salary
or time value of the owner-operator to obtain that
part of net nursery income attributable to capital.
This is the earnings of the investment in the nursery.
When the owner and operator are the same person,
dividing net nursery income between the operator
and return to capital may not be meaningful.
However, when the owners are outside investors,
accurate division is important. Average operator
salaries were given in the previous section "Costs by
Expense Category." Return to capital averaged


$53,293 for all nurseries, $68,835 for the largest
nurseries, and $17,521 for the smallest firms.

Dividing net nursery income by the value of
capital invested gives the rate of return on the
investment. Rate of return is a very commonly used
indicator for evaluating an investment or for
selecting between investment alternatives. For
example, this is equivalent to the widely quoted
yields for capital market instruments such as
certificates of deposit, treasury notes, and bonds.


(3,559,338)

215,686
146,851

68,835
1.83


(119,617)

39,634
22,113

17,521
6.59


I *


17


1988


........................................


kN! ;% 1 ; ; k 1 h; i NN& ;NNNINNN
sma i i est






Dade County Foliage


Figure 18

Return to Capital
25 Dade Co. Fla. Foliage Nurseries, 1988


Percentage Profit to Capital Owned


30%


20%


10%


0%


-10%


-20%


Al I Nirserles Lamest Sn~l lest


***- Highest third

Lowest third


Average value of capital invested for each of the
three years was given in Table 1. Figure 18 shows
that average rate of return on capital was 3.5 percent
for all nurseries, 1.8 percent for the largest nurseries,
and 6.6 percent for smallest. Thus, for every dollar
invested in these foliage nurseries, there was an
average return of 3.5 cents. The deficit of 10 points
in costs per dollar value of production for all
nurseries, as discussed above, was not a loss, but
simply a return on investment less than the 12
percent "standard" allowance which was included as
a cost in the budget.

Highest rates of return on capital averaged 26.8
percent and lowest rates were minus 16.1 percent
(Figure 18).


Statement of Financial Position
The statement of financial position (Appendix
Table 13) summarizes the assets and liabilities of
these nurseries, representing the mid-year financial
situation, derived as an average of the beginning of
the year and end of the year balance sheet figures.
Figure 19 illustrates the major components of the
statement of financial position.


Assets
Assets were classified as either current or long
term. Current assets represent cash or items
deemed convertible to cash within one year's time.
All other assets were designated as long term assets.

Cash on hand includes funds in checking
accounts, savings accounts, and money market funds.
Average cash on hand was $30,444 for all nurseries,
$72,798 for the largest nurseries, and $9,834 for the
smallest firms. The main function of cash on hand
is to pay for current liabilities. As a percentage of
average current liabilities, cash on hand represented
38 percent, 36 percent, and 191 percent, respectivley.

Accounts receivable are uncollected payments due
from all sources. The majority of these are trade
accounts for plants sold. Generally, this figure
should be minimized because uncollected funds
deprive the firm of their use. Accounts receivable
averaged $233,218 for all nurseries, $633,555 for the
largest, and $16,929 for the smallest firms. As a
percentage of annual sales, these amounts
represented 16 percent, 17 percent, and 12 percent,
respectivley.


AL -Ak

...................................................................................................................



..................................................................................................................

&MMMMMM mom M, m


..................................................................................................................


18


All Nurserles Largest


Sm I lest






Dade County Foliage


Figure 19


Assets a
25 Dade Co. Fla.


and Liab I cities
Foliage Nurseries,


Do llars CMi I I ions)
I


Current Assets
Long Term Assets
Current Llab Ilt es
Long Term Llabl I.
Net wrtn


Al Nurs.


Sma IIlest


Inventory values include growing plants and
supplies, which were presented previously in Table
1. The combined value of inventories averaged
$778,041 for all nurseries, $1,846,919 for the largest
firms, and $88,133 for the smallest.

Total current assets averaged $1,041,703 for all
nurseries, $2,553,273 for the largest, and $114,897 for
the smallest nurseries.

Long term assets are investments in buildings,
machinery and land that normally would not be
converted to cash within a year. Current values of
investments are the original cost less accumulated
depreciation. Comparing original cost with the value
remaining after subtracting accumulated depreciation
provides an idea of the degree to which capital assets
have been depleted. Original investments averaged
$846,012 for all nurseries, $2,078,923 for the largest,
and $241,338 for the smallest nurseries. Subtracting
accumulated depreciation left a current value of
$491,701 for all nurseries, $1,216,390 for the largest,
and $150,974 for the smallest nurseries. As a
percentage of the original investment, these current
values represented 58 percent for the average of all
nurseries, 59 percent for the largest nurseries, and


63 percent for the smallest.

Total assets. The sum of current and long term
assets gives average total assets of $1,533,404 for all
nurseries, $3,769,663 for the largest, and $265,871 for
the smallest nurseries. These amounts are the same
as reported for "total owned capital" in Table 1.

Liabilities
Liabilities may be "current" (payable during
the current year) or "long term" (payable at some
time after the current year).

Current liabilities averaged $79,530 for all
nurseries, $201,323 for the largest, and $5,148 for
the smallest firms. The ratio of cash and accounts
receivable to current liabilities, known as the "quick
ratio," is a standard indicator of liquidity, the ability
to pay current operating expenses. The quick ratio
averaged 3.3 for all nurseries, 3.5 for the largest
firms, and 5.2 for the smallest nurseries.

Long term liabilities include notes payable and
mortgages. They averaged $271,949 for all nurseries,
$592,562 for the largest, and $74,353 for the smallest


1988


4.00


3.00 -


2.00 1.-"""........ .....


1.00


0.00


Largest


19






Dade County Foliage


nurseries. The ratio of current liabilities to long
term liabilities was .29 for all nurseries, .34 for
largest, and .07 for the smallest firms.

Total liabilities. The sum of current and long-
term liabilities gives average total liabilities of
$351,478 for all nurseries, $793,885 for the largest,
and $79,501 for the smallest firms. The ratio of
total assets to total liabilities were, 4.4, 4.8, and 3.3,
respectively, which represents a sound financial
position in all cases.

Net Worth
Net worth is the difference between total assets
and total liabilities. This is the actual value of the
owner's share of the assets, as opposed to the
lenders' claims. The average net worth for all
nurseries averaged was $1,181,925, for the largest it
was $2,975,778, and for the smallest $186,369.


Total Profitability Model
The Total Profitability Model combines
information from the operating statement and
statement of financial position in a graphic
presentation to illustrate how assets, liabilities, and
profit margin work together to yield the firm's return
on net worth. Figure 20 shows the three sections of
the profitability model: margin management, asset
management and leverage management. Data for
the largest nurseries, all nurseries, and smallest
nurseries are given in the top, middle, and bottom of
each cell in the model. Data for the all-nursery
average (top box) will be discussed to illustrate the
operation of the model.

Margin Management
From total gain ($1,447,865) is subtracted total
deductions ($1,326,153) and the operator's salary
($68,419) to give return to capital ($53,293). This is
divided by total gain to yield an average net profit
margin of 3.7 percent.

Asset Management
Current assets ($1,041,703) plus long term assets
($491,701) make total assets of $1,533,404. This is
divided into total gain ($1,447,865) to give an asset
turnover rate of .94. Asset turnover multiplied by
net profit margin (3.7 percent) results in an average


return to capital of 3.5 percent.

Leverage Management
Current liabilities ($79,530) plus long term
liabilities ($271,949) gives average total liabilities of
$351,478. This is subtracted from total assets to
yield average net worth of $1,181,925. Total
liabilities plus net worth ($1,533,404) divided by net
worth gives a leverage factor of 1.30. This is really
the ratio of total assets owned by the firm to net
worth. Leverage times rate of return to capital (3.5
percent) gives a return on net worth of 4.5 percent.


CONCLUDING COMMENTS
Nursery operators who are interested in seeing
how they compare with those participating in the
Florida Nursery Business Analysis Program may
calculate their own numbers by following instructions
given in the Appendix under "Making Your Own
Calculations." This analysis should improve
management decisions affecting the profitability of
the nursery operation.

Nursery operators who find this kind of
information useful, but have difficulty finding the
time to do their own calculations may wish to
consider becoming a participant in the Florida
Nursery Business Analysis Program. We need more
participants in the program to provide sounder and
statistically more reliable averages. If you would like
to become a participant, contact your ornamental
agent in your county Extension office, or contact the
authors in Gainesville. 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.


20








21


Dade County Foliage


Figure 20--Total Profitability Model: 25 foliage nurseries in Dade Co., Florida, 1988.


---Margin Management-------------------------------------
total gain
net profit
$1,447,865
$3,775,024 *** $53,293


$159,252 **** $68,835 *** net margin
$17,521 *
3.68%
total costs / **** 1.82% ***
Less interest total gain 11.00% *
__*_________* *
$1,394,572 $1,447,865 *
$3,706,189 *** $3,775,024 *** Rate of
$141,730 $159,252 return

---Asset Management----------------------------------------- X 3.48%
cash total gain **** 1.83% ***
6.59% *
$30,444 current $1,447,865 *
$72,798 *** assets $3,775,024 *** *
$9,834 $159,252 *
$1,041,703 asset *
+ **** $2,553,273 *** turnover *
accts. rec. $114,897 *
/ 0.944 *
$233,218 **** 1.001 *** *
$633,555 *** 0.599 *
$16,929 total asset *
*
+ $1,533,404 *
plant inven. + **** $3,769,663 *** *
* $265,871 *
$764,074 *
1 Oi i1 *** I m-A *


$84,542 assets *
*
+ $491,701 *
supply inven $1,216,390 ***
$150,974
$13,967 *
$33,718 ***
$3,591

-Leverage Management-------------------------------------------- -------
liability plus
current liab. total liab. net worth

$79,530 $351,478 $1,533,404
$201,323 ****** $793,885 ****** $3,769,663 ***
$5,148 $79,501 $265,871 *
I* L- __* __J *


Key

25 Nursery Avg
Largest Third
Smallest Third


RETURN ON
NET WORTH

4.51%
X *** 2.31%
9.40%

*
leverage *
factor *

1.297 *
1.267 ***
1.427


I






















Dade County Foliage


22


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


- - - - - - - - - - -

. . . . . . . .

..............

.................

..... ....... ..

. . . . . . . . . . . .

..........................

. . . . . . . . . . . . .

. . . . . . . . . . . . . .




. . . . . . . . %

. . . . . . . . . .

...................

................

................

....................

. . . . . . . .




. . . . . . .

. . . . . .

..........

............

............

. . . . . . . . .



............














































...........



..............






...........

. . . . . .

...........

. . . . . . ..






lb



. . . . .. . . . . . so *8 G*


..................











. . . . .. .













. . . . . . .

. . . . . .
































































































. . . . . . . . . .






Dade County Foliage


APPENDIX
Appendix Table of Contents Page

Definitions ................................................................. 24
Making your own calculations .................................................... 24
Appendix Tables ............................................................. 26

List of Appendix Data Tables

Appendix Table Page

1 Size of business, 25 foliage nurseries in Dade Co., Florida, 1988 ....................... 26
2 Rates of production, 25 foliage nurseries in Dade Co., Florida, 1988 ..................... 27
3 Land use indicators, 25 foliage nurseries in Dade Co., Florida, 1988 ..................... 27
4 Labor use indicators, 25 foliage nurseries in Dade Co., Florida, 1988 . . . . . . . . . .. 27
5 Capital use indicators, 25 foliage nurseries in Dade Co., Florida, 1988 . . . . . . . . .. 28
6 Costs by expense category, 25 foliage nurseries in Dade Co., Florida, 1988 ....... . . . . . 29
7 Percent of total costs by expense category, 25 foliage nurseries in Dade Co., Florida, 1988 ...... 30
8 Costs per square foot of bed and bench space, 25 foliage nurseries in Dade Co., Florida, 1988 ... 31
9 Costs per square foot of propagating and finishing space,
25 foliage nurseries in Dade Co., Florida, 1988 .................................. 32
10 Costs per dollar's worth of production, 25 foliage nurseries in Dade Co., Florida, 1988 ........ 33
11 Cost per dollar's worth of sales (no adjustment for change in plant
inventory), 25 foliage nurseries in Dade Co., Florida, 1988 .......................... 34
12 Income summary, 25 foliage nurseries in Dade Co., Florida, 1988 . .. .. .. . . . . . . 35
13 Statement of financial position, 25 foliage nurseries in Dade Co., Florida, 1988 .............. 35
14 Financial ratios and other profitability indicators, 25 foliage nurseries in Dade Co., Florida, 1988 36


23






Dade County Foliage


DEFINITIONS
Value of own plants sold: the value of total plant
sales minus the cost of plants purchased for
immediate resale. The cost of plants purchased for
growing-on are not deducted.

Full-time equivalent employee: 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 people
not paid on an hourly basis.

Capital owned: the current value (cost less
depreciation taken in prior years) of capital assets, or
current investment in the nursery operation. Related
debt is not deducted in this determination of the
value of capital owned.

Capital managed: the value of capital owned plus
the value of additional capital items used and under
the control of the manager. Rented land and leased
buildings, equipment, etc., would be added to the
value of capital owned to obtain the value of capital
managed in the nursery operation.

Annual turnover of capital: the percentage that
results from dividing the value of own plants sold by
the value of capital (either owned or managed). It
is annual plant sales stated in terms of percent of
the capital involved.

Total gain: the sum of plant sales, changes in
plant and supply inventories, and miscellaneous cash
income. It represents the total effect of the year's
operation, be it in the form of cash received or in
the form of change in values of inventories.

Net nursery income: the net effect of the year's
operation. To obtain it, all cash costs (except
operator's salary), and all non-cash costs (except the
12 percent non-cash interest allowance on capital)
are subtracted from total gain. The result is the
return for the time and managerial skills of the
operator, and for the use of the capital invested in
the operation.

Return to capital: the portion of net nursery
income that is left after subtracting the salary or


time value of the operator. It is what the owned
capital earned.

Rate of return on capital: return to capital
divided by the value of owned capital. It is the rate
earned on the capital invested.

MAKING YOUR OWN CALCULATIONS
Analysis of your own operation for comparison
with the findings of this report can be done manually
with the information in Appendix Tables 1 and 6 for
your nursery. Lines are provided for entry of your
data. Make calculations for your nursery data in
Appendix Tables 2, 3, 4, and 5 according to the
formulaes shown on each line. For example, the
first line of Appendix Table 2, "Sales per square foot
growing area" shows a formula in parentheses: Table
1A/1E. The slash mark (/) stands for division. The
Table 1A stands for the A line of Appendix Table
1, and 1E stands for the E line.

Calculations starting with Appendix Table 7 and
continuing through Appendix table 11 are made by
dividing each line of Appendix Table 6 by the
appropriate figure as follows:

Appendix Table 7--divide your data in Appendix
Table 6 by your total all costs figure at the bottom
of Appendix Table 6.

Appendix Table 8--divide your data in Appendix
Table 6 by your square footage figure on line F of
Appendix Table 1.

Appendix Table 9--divide your data in Appendix
Table 6 by your square footage figure on line D of
Appendix Table 1.

Appendix Table 10--divide your data in Appendix
Table 6 by your total value of production figure on
line C of Appendix Table 1.

Appendix Table 11--divide your data in Appendix
Table 6 by your sales figure on line A of Appendix
Table 1.


24






Dade County Foliage


For Appendix Tables 12 and 13, formulas are not shown, but are needed in order for you to complete the
profitability model in Figure 20. Instructions for Appendix Table 12 are as follows:


Line A: Value of own plants sold .......
Line B: Change in plant inventory value . .
Line C: Supply inventory increase .......
shown previously

Line D: Miscellaneous income .........
Line E: Total gain ..................
Line F: Deduct cash costs ..............
Line G: Deduct non-cash costs ........ .
Line H: Total deductions .............
Line I: Net nursery income .............
Line J: Deduct operator's salary ....... .
Line K: Return to capital ..............
Line L: Rate of return to capital ........

Instructions for Appendix Table 13 are as follows:


* Line A: Cash on hand ....


Appendix Table 1, line A
Appendix Table 1, line B
from your beginning and ending supply inventory data, not


from your business records, not shown previously
sum of lines A, B, C, and D.
from Appendix Table 6 (subtract operators salary)
from Appendix Table 6 (subtract interest on capital)
sum lines F and G
line E minus line H
from line 1 of Appendix Table 6
line I minus line J
line K divided by Appendix Table 1, line Q


. . . . ... Appendix Table 1 line P


Line B: Accounts receivable ..........
Line C: Plant inventory . . . . . . .
Line D: Supply inventory . . . . . .
Line E: Total current assets . . . . .
Line F: Machinery & equipment .......
Line G: Buildings and fixtures .........
Line H: Land ....................
Line I: Original cost ...............
Line J: Accumulated depreciation ......


Appendix Table 1 line 0
. Appendix Table 1 line J
. Appendix Table 1 line N
. sum lines A, B, C, and D
. Appendix Table 1 line L
. Appendix Table 1 line K
. Appendix Table 1 line M
. Sum lines F,G, and H.
. From your records, not shown previously.


(Skip line J if lines F, G, and H are depreciated values. Otherwise, enter accumulated depreciation.
Line K: Total long term assets ......... Subtract line J from line I.
Line L: Total assets . . ...... . . ... sum lines E and K
Line M: Current liabilities ............ from your records, not shown in earlier tables
Line N: Long term liabilities ........... from your records, not shown in earlier tables
Line 0: Total liabilities .............. sum line M and N
Line P: Net worth .................. line L minus line 0
Line Q: Total liabilities and net worth .... sum lines 0 and P

This data required for the profitability model.

The business analysis calculations can also be done yourself with IFAS's MS-DOS compatible computer
program FOLAGNBA. Order program number 002, priced at $20, from:

IFAS Software Support Office
Building 120, Room 203
University of Florida
Gainesville, FL 32611


25







Dade County Foliage


APPENDIX TABLES


Table 1--Size of Business: 25 foliage nurseries in Dade Co., Florida, 1988.


All 25
unit Nurseries


A Value of own plants sold .. ......
B Change in inventory vaLue . . . .

C Total value of production . . . .


. $ 1,417,627
. $ 17,668

. $ 1,435,295


D Space for propagating & finishing . . .sq.ft. 703,664
E Space for stock plants . . . . . .sq.ft. 24,361

F Total bed and bench space. . . . . .sq.ft. 728,025


G Total nursery area . . . . . ... .sq.ft.
H acres

I Full-time equivalent persons . . . .number


............Capital Owned-------------
Growing plants . . . . .
Bldgs, improvements . . ..
Machinery & equipment . . ..
Land . . . . . . . .
Supply inventory . . . . .
Accounts receivable . . ..
Cash/checkbook balance . . .


Q Total Owned Capital . . . . . ..

.........--- Capital Leased-------------
R Bldgs, improvements . . . . . ..
S Machinery & equipment . . . . ..
T Land . . . . . . . . . .


U Total Leased Capital . . . . . ..


.----------Capital Managed-------------
V Growing plants . . . . . . . .
W BLdgs, improvements. . . . . . ......
X Machinery & equipment . . . . . ...
Y Land .... ................
Z Supply inventory . . . . . . .
AA Accounts receivable . . . . . ..
AB Cash/checkbook balance . . . . . .

AC Total Capital Managed . . . . . .


917,856
21.07

28.00


$ 764,074
$ 263,476
$ 64,885
$ 163,340
$ 13,967
$ 233,218
$ 30,444

$ 1,533,404


20,245
2,020
114,148

136,413


$ 764,074
$ 283,721
$ 66,905
$ 277,487
$ 13,967
$ 233,218
$ 30,444

$ 1,669,816


Largest
Third (8)


3,752,542
(1,788)

3,750,754

1,909,914
30,925

1,940,839

2,320,903
53.28

71.31


1,813,201
689,060
171,496
355,834
33,718
633,555
72,798

3,769,663


12,125
2,813
230,750

245,688


1,813,201
701,185
174,308
586,584
33,718
633,555
72,798

4,015,350


Smallest Your
Third (8) Nursery


138,615
18,455

157,070

66,578
5,036

71,614

116,469
2.67

4.00


84,542
58,986
8,801
83,188
3,591
16,929
9,834

265,871


938
375
30,438

31,750


84,542
59,923
9,176
113,625
3,591
16,929
9,834

297,621


26


J
K
L
M
N
0
P







Dade County Foliage

Table 2--Rates of Prodution Indicators: 25 foliage nurseries in Dade Co., Florida, 1988.


All 25 Largest Smallest Your
unit Nurseries Third (8) Third (8) Nursery
.....................-----------------------------------------.....................................--.-----------


Sales/sq.ft. bench space . . (Table 1A/1E)
Production/sq.ft. bench space. (Table 1C/1E)

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

Sales/acre total nursery area. (Table 1A/1G)
Production/acre. . . . .. (Table 1C/1G)


$ 1.95
$ 1.97

$ 2.01
S 2.04

$ 67,278
$ 68,117


Table 3--Labor Use Indicators: 25 foliage nurseries in Dade Co., Florida, 1988.

Atll 25 Largest Smallest Your
unit Nurseries Third (8) Third (8) Nursery
.. ---.--...---.-....---.----- -----------------------....M------------------------------------


Plant sales per person* . .. (Table 1A/1I)
Value of production per person* (Table 1C/1I)


$ 50,625
$ 51,256


Growing area per person*. .. (Table 1F/11) sq.ft.
Persons per acre growing area (Table 1F/1H) number


25,999
1.33


52,625
52,600

27,218
1.34


34,685
39,303

17,920
1.49


Full-time equivalent person (2080 hrs/year)


Table 4--Space Use Indicators: 25 foliage nurseries in Dade Co., Florida, 1988.


ALL 25 Largest Smallest Your
unit Nurseries Third (8) Third (8) Nursery
-----------------------------------------------------------------------------------------


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

Average vacant bench space. . . . . .sq.ft.
--percentage of bench space . . . . . X

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

Total bed & bench 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 IE/1F) %


185.5

43,994
6.0

917,856


728,025
79.3

703,664
96.7


207.0

119,654
6.2

2,320,903


1,940,839
83.6

1,909,914
98.4


24,361 30,925
3.3 1.6


27


1.93
1.93

1.96
1.96

70,430
70,396


1.94
2.19

2.08
2.36

51,843
58,745


164.0

5,011
7.0

116,469


71,614
61.5

66,578
93.0


5,036
7.0







Dade County Foliage


Table 5--Capital Use Indicators: 25 foliage nurseries in Dade Co., Florida, 1988.


All 25
unit Nurseries


Owned capital turnover. . (Table 1A/10)
Managed capital turnover. .(Table 1A/1AC)

Capital owned/person* . . (Table 10/1I)
Capital managed/person* . .(Table 1AC/1I)

Capital owned/acre. .. .... (Table 1Q/1H)
Capital managed/acre. . .(Table 1AC/1H)


---Managed Capital Per Person In---
Growing plants. . . ... (T<
BLdgs, improvements . .. (Te
Machinery & equipment . . (Ti
Land. . . . . . .. (Te


---Managed Capital Per Acre In--
Growing plants . . ..
BLdgs, improvements .. ...
Machinery & equipment . .
Land . . . . . ..


able
able
able
able


(Table
(Table
(Table
(Table


--Distribution of Managed Capital---
in growing plants . . .(Table
in buildings & wells. . .(Table
in machinery & equipment. .(Table
in land . . . . . .(Table
in supply inventory . . .(Table
in accounts receivable. . .(Table
in cash/checkbook balance .(Table


% 92.4
% 84.9

$ 54,760
$ 59,631

$ 72,773
$ 79,247


1V/1I)
1W/II)
1X/1I)
1Y/11)


1V/1H)
1W/1H)
1X/1H)
1Y/1H)


1V/1AC)
1W/1AC)
1X/1AC)
1Y/lAC)
1Z/IAC)
1AA/1AC)
1AB/1AC)


TOTAL . . . . . . . . .


27,286
10,132
2,389
9,909


36,262
13,465
3,175
13,169


45.8
17.0
4.0
16.6
0.8
14.0
1.8

100.0


Largest Smallest Your
Third (8) Third (8) Nursery

99.5 52.1
93.5 46.6


52,865
56,310

70,751
75,362


25,428
9,833
2,444
8,226


34,031
13,160
3,272
11,009


45.2
17.5
4.3
14.6
0.8
15.8
1.8

100.0


66,528
74,472

99,437
111,312


21,155
14,994
2,296
28,432


31,619
22,412
3,432
42,497


28.4
20.1
3.1
38.2
1.2
5.7
3.3

100.0


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


28







Dade County Foliage







Table 6--Dollar Cost by Expense Category: 25 foliage nurseries in Dade Co., FLorida, 1988.


All 25
unit Nurseries
--- -- --- -- --- -- -- f --- -- -- --- --ft .. .. .. 68,419-- --


Operator's salary . . . . . . .
Other wages . . . . . . . .


LABOR TOTAL . . . . .


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 . . . . . . .


$ 68,419
$ 431,176

$ 499,595

$ 359,413
$ 61,578
$ 12,989
$ 40,640
$ 37,150
$ 35,227
$ 32,128
$ 32,594

$ 611,718


50,188
12,006

62,193


$ 16,708
$ 24,219
$ 12,643
$ 7,427
S 11,762
$ 8,666
$ 13,766
$ 53,347

$ 148,537

$ 1,322,043

$ 22,093
$ 50,436
$ 0
$ 184,008

$ 256,537

$ 1,578,581


Largest
Third (8)

146,851
1,153,708

1,300,559


1,033,288
160,598
36,451
101,374
98,784
92,956
85,345
84,722

1,693,518

140,421
23,799

164,220

43,086
50,075
29,250
17,466
28,444
19,748
28,783
144,341

361,192

3,519,488

56,166
130,535
0
452,360

639,060

4,158,548


29


Your
Nursery


Smallest
Third (8)

22,113
35,098

57,211

13,537
9,932
419
6,779
3,937
2,736
3,782
3,707

44,829

2,923
3,549

6,471

2,068
3,917
2,379
1,386
789
2,044
1,036
3,482

17,102

125,613

4,430
11,687
0
31,904

48,021

173,635


a a a 0 a a


ALL 25
uni t Nurseries








30 Dade County Foliage







Table 7--Percent of Total Costs by Expense Category: 25 foliage nurseries in Dade Co., Florida, 1988.


All 25
unit Nurseries
Operator's- salary-- .------ ..-----.-..- 4 ----- ------- .3


Operator's salary . . . . . . .
Other wages .................

LABOR TOTAL .................

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 . . . . . . .


% 4.3
% 27.3

% 31.6


22.8
3.9
0.8
2.6
2.4
2.2
2.0
2.1

38.8

3.2
0.8

3.9


% 1.1
% 1.5
% 0.8
% 0.5
% 0.7
% 0.5
% 0.9
% 3.4

% 9.4

% 83.7

% 1.4
% 3.2
% 0.0
% 11.7

% 16.3

% 100.0


Your
Nursery


Largest
Third (8)

3.5
27.7

31.3

24.8
3.9
0.9
2.4
2.4
2.2
2.1
2.0

40.7

3.4
0.6

3.9

1.0
1.2
0.7
0.4
0.7
0.5
0.7
3.5

8.7

84.6

1.4
3.1
0.0
10.9

15.4

100.0


Smallest
Third (8)

12.7
20.2

32.9

7.8
5.7
0.2
3.9
2.3
1.6
2.2
2.1

25.8

1.7
2.0

3.7

1.2
2.3
1.4
0.8
0.5
1.2
0.6
2.0

9.8

72.3

2.6
6.7
0.0
18.4

27.7

100.0







Dade County Foliage







Table 8--Costs Per Square Foot of Bed & Bench Space: 25 foliage nurseries in Dade Co., Florida, 1988.


ALl 25
unit Nurseries
Operator's-----sa --ary ---.ft. --------.ft.---.---.----ftcents-


Operator's salary . . . . . cents
Other wages ................ cents

LABOR TOTAL ................ cents


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
cents
cents
cents


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

TOTAL All COSTS . . . . . . .. .cents


9.4
59.2

68.6


49.4
8.5
1.8
5.6
5.1
4.8
4.4
4.5

84.0

6.9
1.6

8.5

2.3
3.3
1.7
1.0
1.6
1.2
1.9
7.3

20.4

181.6

3.0
6.9
0.0
25.3

35.2

216.8


31


Your
Nursery


Largest
Third (8)

7.6
59.4

67.0


53.2
8.3
1.9
5.2
5.1
4.8
4.4
4.4

87.3

7.2
1.2

8.5

2.2
2.6
1.5
0.9
1.5
1.0
1.5
7.4

18.6

181.3

2.9
6.7
0.0
23.3

32.9

214.3


Smallest
Third (8)

30.9
49.0

79.9

18.9
13.9
0.6
9.5
5.5
3.8
5.3
5.2

62.6

4.1
5.0

9.0

2.9
5.5
3.3
1.9
1.1
2.9
1.4
4.9

23.9

175.4

6.2
16.3
0.0
44.6

67.1

242.5








32 Dade County Foliage








Table 9--Costs Per Square Foot of Propagating & Finishing Space: 25 foliage nurseries in Dade Co., Florida, 1988


Operator's salary ............. .cents
Other wages . . . . . . . .. cents

LABOR TOTAL ................ cents


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


All 25 Largest
unit Nurseries Third (8)
-- -- -- -- ---9.7 -- -- 7---7 -


cents
cents
cents
cents
cents
cents
cents
cents


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

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


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 . . . .


cents


9.7
61.3

71.0

51.1
8.8
1.8
5.8
5.3
5.0
4.6
4.6

86.9

7.1
1.7

8.8


cents 2.4
cents 3.4
cents 1.8
cents 1.1
cents 1.7
cents 1.2
cents 2.0
cents 7.6

cents 21.1

cents 187.9


cents
cents
cents
cents


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

TOTAL All COSTS . . . . . . .. cents


3.1
7.2
0.0
26.2

36.5

224.3


Smallest Your
Third (8) Nursery

33.2
52.7

85.9

20.3
14.9
0.6
10.2
5.9
4.1
5.7
5.6

67.3

4.4
5.3

9.7


7.7
60.4

68.1

54.1
8.4
1.9
5.3
5.2
4.9
4.5
4.4

88.7

7.4
1.2

8.6

2.3
2.6
1.5
0.9
1.5
1.0
1.5
7.6

18.9

184.3

2.9
6.8
0.0
23.7

33.5

217.7


3.1
5.9
3.6
2.1
1.2
3.1
1.6
5.2

25.7

188.7

6.7
17.6
0.0
47.9

72.1

260.8







Dade County Foliage 33







Table 10--Cost Per Dollar's Worth of Production: 25 foliage nurseries in Dade Co., Florida, 1988.


ALL 25 Largest Smallest Your
unit Nurseries Third (8) Third (8) Nursery

Operator's salary .............. cents 4.8 3.9 14.1
Other wages ................ cents 30.0 30.8 22.3

LABOR TOTAL ................ cents 34.8 34.7 36.4

Plants & seeds ............... cents 25.0 27.5 8.6
Containers. ................ cents 4.3 4.3 6.3
Heating fuel. ............... cents 0.9 1.0 0.3
Peat & soil ................. cents 2.8 2.7 4.3
Fertilizers & lime. .............. cents 2.6 2.6 2.5
Pesticides & chemicals. ........... cents 2.5 2.5 1.7
Packaging & shipping supplies ........ cents 2.2 2.3 2.4
Other production supplies ......... cents 2.3 2.3 2.4

SUPPLIES TOTAL. ................ cents 42.6 45.2 28.5

Facility repairs. ............. cents 3.5 3.7 1.9
Equipment operation ............. cents 0.8 0.6 2.3

OTHER PRODUCTION COSTS TOTAL. ........ cents 4.3 4.4 4.1

Travel. .................. cents 1.2 1.1 1.3
Insurance ................. cents 1.7 1.3 2.5
Telephone ................. cents 0.9 0.8 1.5
Electricity ................ cents 0.5 0.5 0.9
Taxes & licenses. .............. cents 0.8 0.8 0.5
Advertising ................ cents 0.6 0.5 1.3
Rent-Land/buildings ............. cents 1.0 0.8 0.7
Other cash costs. .............. cents 3.7 3.8 2.2

ADMINISTRATIVE & OVERHEAD COSTS TOTAL . cents 10.3 9.6 10.9

TOTAL CASH COSTS. .............. cents 92.1 93.8 80.0

Depreciation-machinery/equipment. . . cents 1.5 1.5 2.8
Depreciation-buildings/etc. . . . . cents 3.5 3.5 7.4
Supply inventory decrease ........... cents 0.0 0.0 0.0
Interest on capital ............. cents 12.8 12.1 20.3

TOTAL NON-CASH COSTS. . . . . . cents 17.9 17.0 30.6

TOTAL All COSTS .............. cents 110.0 110.9 110.5








34 Dade County Foliage







Table 11--Cost Per Dollar's Worth of Sales: 25 foliage nurseries in Dade Co., Florida, 1988.


AlL 25
unit Nurseries
Operator's----salary..a.................et 4.8-------------


Operator's salary . . . . . . cents
Other wages ................ cents

LABOR TOTAL . . . . . . . .. cents


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-bui ldings/etc . .
Supply inventory decrease . .
Interest on capital . . . .


cents
cents
cents
cents


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

TOTAL All COSTS . . . . . . .. cents


4.8
30.4

35.2

25.4
4.3
0.9
2.9
2.6
2.5
2.3
2.3

43.2

3.5
0.8

4.4

1.2
1.7
0.9
0.5
0.8
0.6
1.0
3.8

10.5

93.3

1.6
3.6
0.0
13.0

18.1

111.4


Largest Smallest Your
Third (8) Third (8) Nursery
3.. . . ..9 16. 0 - - -m- -


3.9
30.7

34.7

27.5
4.3
1.0
2.7
2.6
2.5
2.3
2.3

45.1

3.7
0.6

4.4

1.1
1.3
0.8
0.5
0.8
0.5
0.8
3.8

9.6

93.8

1.5
3.5
0.0
12.1

17.0

110.8


16.0
25.3

41.3

9.8
7.2
0.3
4.9
2.8
2.0
2.7
2.7

32.3

2.1
2.6

4.7

1.5
2.8
1.7
1.0
0.6
1.5
0.7
2.5

12.3

90.6

3.2
8.4
0.0
23.0

34.6

125.3


a 0







Dade County Foliage



Table 12--Income Summary: 25 foliage nurseries in Dade Co., Florida, 1988.


Atl 25
unit Nurseries


A Value of own plants sold . . . . .. .$
B Change in plant inventory value. . . ... $
C Increase in supply inventory . . . .. $
D Miscellaneous cash income. . . . ... S

E TOTAL GAIN ................. $


1,417,627
17,668
1,298
11,272

1,447,865


F Deduct cash costs except operator's salary $ (1,253,624)
G Deduct non-cash costs except interest on cap $ (72,529)

H Total Deductions . . . . . . .. $ (1,326,153)

I NET NURSERY INCOME . . . . . .. $ 121,712
J Operator's salary or time value. . . $ 68,419

K RETURN TO CAPITAL. . . . . . .. $ 53,293
L --Percent. ................. % 3.48


Largest Smallest
Third (8) Third (8)

3,752,542 138,615
(1,788) 18,455
459 2,023
23,810 159

3,775,024 159,252


(3,372,637)
(186,701)

(3,559,338)

215,686
146,851

68,835
1.83


(103,500)
(16,117)

(119,617)

39,634
22,113

17,521
6.59


Table 13--Statement of Financial Position: 25 foliage nurseries in Dade Co., Florida, 1988.


---Current Assets---
A Cash/checkbook balance . . . . .
B Accounts receivable . . . . ..
C Plant inventory value . . . ..
D Supply inventory value . . . .

E Total CURRENT Assets . . . . .


---Long Term Assets---
F Machinery & Equipment. .
G Buildings & Fixtures . .
H Land ............

I Sub-total (original cost). .

J Less Accumulated Depreciation

K Total LONG TERM Assets . .

L TOTAL ASSETS. . . .


---Liabilities---
M Current Liabilities . . . . . ..
N Long Term Liabilities . . . . .

0 Total LIABILITIES. . . . . . . .

P NET WORTH. . . . . . . . . .

0 TOTAL LIABILITIES & NET WORTH. . . . .


All 25
unit Nurseries


$ 30,444
$ 233,218
$ 764,074
$ 13,967

$ 1,041,703


. . . $ 209,809
S. . . $ 472,863
........ $ 163,340

. . . $ 846,012

. . . $ (354,311)

. . . $ 491,701

. . . . 1,533,404


$ 79,530
$ 271,949

$ 351,478

$ 1,181,925

S 1,533,404


Largest Smallest Your
Third (8) Third (8) Nursery


72,798
633,555
1,813,201
33,718

2,553,273


536,653
1,186,436
355,834

2,078,923

(862,533)

1,216,390

3,769,663


201,323
592,562

793,885

2,975,778

3,769,663


9,834
16,929
84,542
3,591

114,897


38,469
119,682
83,188

241,338

(90,364)

150,974

265,871


5,148
74,353

79,501

186,369

265,871


35


Your
Nursery








36 Dade County Foliage







Table 14--Financial Ratios and Other Profitability Indicators: 25 foliage nurseries in Dade Co., Florida, 1988


All 25 Largest Smallest Your
Nurseries Third (8) Third (8) Nursery
----------------------------ft------------ft---------------------- ----------- ft...t....w.............
Cash on Hand/Current Liabilities ........... 0.38 0.36 1.91

Accounts Recievable/Sales. ............. 0.16 0.17 0.12

Quick Ratio (Cash & Acct.Rec./Curr.Liab) ...... 3.32 3.51 5.20

Inventory Turnover .w............... 1.86 2.07 1.64

Current Value/Orig. Cost of Long Term Assets . 0.58 0.59 0.63

Total Assets/Total Liabilities ........... 4.36 4.75 3.34

Current Liabilities/Long Term Liabilities. ..... 0.29 0.34 0.07

Net Profit Margin................. 3.7% 1.8% 11.0%

Asset Turnover Ratio ........ ......... 0.94 1.00 0.60

Return to Capital. ................. 3.48% 1.83% 6.59%

Leverage Factor. .................. 1.30 1.27 1.43

Return on Net Worth. ...... ........ . . 4.5% 2.3% 9.4%