• TABLE OF CONTENTS
HIDE
 Front Cover
 Title Page
 Abstract
 Table of Contents
 List of Figures
 List of Tables
 Introduction
 Procedure
 Data and results
 Productivity indicators
 Cost of production
 Cost efficiency
 Income summary
 Statement of financial positio...
 Total profitability model
 Conclusion
 Appendix
 Back Cover














Group Title: 1987- Florida nursery business analysis series
Title: Business analysis of foliage plant nurseries in Dade County, Florida
ALL VOLUMES CITATION THUMBNAILS PAGE IMAGE ZOOMABLE
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00014561/00004
 Material Information
Title: Business analysis of foliage plant nurseries in Dade County, Florida
Series Title: 1987- : Florida nursery business analysis series
Alternate 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
Publication Date: 1987
Copyright Date: 1988
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 )
 Notes
General Note: Description based on: 1984; title from cover.
 Record Information
Bibliographic ID: UF00014561
Volume ID: VID00004
Source Institution: University of Florida
Holding Location: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: ltqf - AAA7023
ltuf - AHN4358
oclc - 23593531
alephbibnum - 001610008
lccn - sn 91022506

Table of Contents
    Front Cover
        Front Cover
    Title Page
        Page i
        Page ii
    Abstract
        Page iii
        Page iv
    Table of Contents
        Page v
        Page vi
    List of Figures
        Page vii
        Page viii
    List of Tables
        Page ix
        Page x
    Introduction
        Page 1
    Procedure
        Page 2
    Data and results
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
    Productivity indicators
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
    Cost of production
        Page 14
        Page 15
        Page 16
        Page 17
    Cost efficiency
        Page 18
        Page 19
        Page 20
        Page 21
    Income summary
        Page 22
        Page 23
        Page 24
    Statement of financial position
        Page 25
        Page 26
        Page 27
    Total profitability model
        Page 28
        Page 29
    Conclusion
        Page 30
    Appendix
        Page 31
        Page 32
        Page 33
        Page 34
        Page 35
        Page 36
        Page 37
        Page 38
        Page 39
        Page 40
        Page 41
        Page 42
        Page 43
    Back Cover
        Page 44
Full Text
:loo
2&2.


J. Robert Strain
Alan W. Hodges


Economic Information
Report 252


DeArmand Hull




Business Analysis of Foliage Plant
Nurseries in Dade County
Florida, 1987


Food & Resource Economics Department
Agricultural Experiment Stations and
Cooperative Extension Service
Institute of Food and Agricultural Sciences
University of Florida, Gainesville 32611


December 1988




















J. Robert Strain
Alan W. Hodges
DeArmand Hull


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ABSTRACT
Average sales, costs, returns, and efficiency indicators are presented for 21 wholesale
foliage plant nurseries in Dade County Florida, for the tax year of 1987. Plant sales averaged
$1,040,954, and growth in the value of plant inventory during the year was $21,563. When
adjustments were made for changes in inventories and miscellaneous income, total gain for the
year was $1,071,268. Total costs of production, including cash expenses and non-cash
allowances for depreciation, but excluding any returns to the operator averaged $962,817. Net
nursery income averaged $108,451. Capital investment including plant inventory, land,
equipment, buildings, supplies, and accounts receivable amounted to $1,091,829. Average return
on capital investment was 3.9 percent. Average returns (to owner-operator and capital) per
square foot of growing area were $.164. Comparable information is presented also for
subsamples of largest and smallest nurseries.
KEY WORDS: Foliage nursery business analysis, income, costs, investment, efficiency
measures, Florida, Dade County.


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. Errors in the analyses or in the interpretation of the information
presented herein are the sole responsibility of the authors.














TABLE OF CONTENTS


ABSTRACT .........
ACKNOWLEDGEMENTS . .
LIST OF FIGURES ......
LIST OF TABLES .......
LIST OF APPENDIX TABLES


INTRODUCTION .................. .
PROCEDURE ......................
DATA AND RESULTS ..................
Size of Business ...................
Sales and Total Value of Production . . . .
Annual sales . . . . . . . .
Monthly sales ...............
Land, Labor and Capital . . . . . ..
Land: bed and bench space . . . . .
Labor: full-time equivalent persons . . .
Capital: owned and managed . . . .
Productivity Indicators . . . . . . . .
Land Use . . . . . . . . . .
Labor Use . . . . . . . . . .
Capital Use . . . . . . .. . . .
Capital turnover ..............
Capital managed per person . . . ..
Capital managed per acre . . . . .
Distribution of managed capital . . . .
Costs of Production .................
Costs by Expense Category* . . . . . .
Costs as a Percent of the Total Cost* . . . .
Cost Efficiency . . . . . .. . .. .
Cost Per Square Foot of Bed and Bench Space. .
Cost Per Square Foot of Propagating and Finishing
Cost Per Dollar's Worth of Production . . .
Cost Per Dollar's Worth of Sales . . . . .
Income Summary ...................


Total Gain ........
Cost Deductions and Net Nu
Return on Capital .....
Statement of Financial Position .
Assets . . . . .
Cash on hand ...
Accounts receivable .
Inventory values . .
Total current assets .
Long term assets ..
Total assets . . .


. . .
....


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


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






.pace .

....
. . .

.. .
....

. .. .

Spae .
. . .
S . .

....


...........
rsery Income ....
...........

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

...........


* These sections also contain the following subcategories:
Salaries and wages
Production supplies Total cash costs
Other production costs Non-cash costs
Administrative and overhead Total all costs


. iii
. iii
Svii
. ix
Six


2
3
3
3
3
5
6


6
7

8

9
. . 11

11
. . 12
. . 12

12
. . 14
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. . 15
18
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.... 22
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.... 125
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.... 25
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. . 25







. .. 25
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TABLE OF CONTENTS (Continued)


Liabilities . . . . . . . . . . .
Current liabilities . . . . . . . .
Long term liabilities . . . . . . .
Total liabilities. . . . . . . . .
Net W orth . . . . . . . . . . .
Total Profitability Model . . . . . . . . .
Margin Management. . . . . . . . .
Asset Management . . . . . . . . .
Leverage Management. . . . . . . . .
CONCLUDING COMMENTS . . . . . . . . .


APPENDIX. ............
Definitions . . . . .
Making your own calculations
Appendix Tables . . . .


Page


i I i I I r










LIST OF FIGURES


Figure


Sales and Total Value of Production. . . . . . . . . . . ..


Monthly Sales ........ .........

Land: Bed and Bench Space ............

Labor: Number of Persons. ............

Capital Owned and Managed ...........

Land Use: Value of Production Per Square Foot .

Labor Use: Value of Production Per Person . .

Capital Turnover .................

Capital Managed Per Person ...........

Capital Managed Per Acre ............

Distribution of Managed Capital . . . . .

Distribution of Costs of Production . . . .

Costs Per Square Foot of Bed and Bench Space. .

Costs Per Square Foot of Propagating and Finishing

Costs Per Dollar's Worth of Production . . .

Cash Costs Per Dollar's Worth of Sales . . .

Distribution of Total Gain ............

Return to Capital.................

Assets and Liabilities ...............

Total Profitability Model .............


. . . . . . . . 5
5

. . . . . . . . 6

. . . . . . . . 6





. . . . . . . . 7





. . . . . . . . 12
. . . . . . . 12
. . . . . . . . 11






................ 13
. . . . . . . . 12






..18
Space . ............. 1

. . . . . . . 20

. . . . . . . 21
. . . . . . . . 18

Space . . . . . . 19

. . . . . . . . 20

. . . . . . . . 21

. . . . . . . . 23

. . . . . . . . 24

. . . . . . . . 26

. . . . . . . . 29


1


Pe
4













LIST OF TABLES
Table ge

1 Sales, growing area, people and capital, 21 foliage nurseries in Dade
County, Florida, 1987 ............................ 4

2 Costs of production, 21 foliage nurseries in Dade County, Florida, 1987. . . ... 14

3 Income summary, 21 foliage nurseries in Dade County, Florida, 1987 . . ... 22




LIST OF APPENDIX DATA TABLES

Appendix Table gage

1 Size of business, 21 foliage nurseries in Dade County, Florida, 1987 . . ... 35

2 Rates of production, 21 foliage nurseries in Dade County, Florida, 1987 . . .. 35

3 Land use indicators, 21 foliage nurseries in Dade County, Florida, 1987 . . .. 35

4 Labor use indicators, 21 foliage nurseries in Dade County, Florida, 1987 . . .. 36

5 Capital use indicators, 21 foliage nurseries in Dade County, Florida, 1987 . . .. 36

6 Costs by expense category, 21 foliage nurseries in Dade County, Florida,
1987 . . . . . . . . . . . . . . . . . 37

7 Percent of total costs by expense category, 21 foliage nurseries in Dade County,
Florida, 1987 . . . . . . . . . . . . . . ... . 38

8 Costs per square foot of bed and bench space, 21 foliage nurseries in Dade
County, Florida, 1987 . .. . . .. . . . . . . ... 39

9 Costs per square foot of propagating and finishing space, 21 foliage nurseries
in Dade County, Florida, 1987 ........................ 40

10 Costs per dollar's worth of production, 21 foliage nurseries in Dade County,
Florida, 1987 . . . . . . . . . . . . . . ... . 41

11 Cost per dollar's worth of sales (no adjustment for change in plant
inventory), 21 foliage nurseries in Dade County, Florida, 1987 . . ... 42

12 Income summary, 21 foliage nurseries in Dade County, Florida, 1987 . . ... 43

13 Statement of Financial Position, 21 foliage nurseries in Dade County,
Florida, 1987 . . . . . . . . . . . . . . .. 43























BUSINESS ANALYSIS OF FOLIAGE NURSERIES IN DADE COUNTY, FLORIDA, 1987



J. Robert Strain, Alan Hodges and DeArmand Hull



INTRODUCTION


This publication contains information on sales, costs, returns and production efficiency
for 21 wholesale foliage plant nurseries in Dade County Florida for 1987. Other publications
in the Florida Nursery Business Analysis series include reports on South Florida foliage plant
nurseries, Central 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.


J. ROBERT STRAIN is an extension economist and professor, and ALAN HODGES is an
economic analyst, both in IFAS Food and Resource Economics Department. DeArmand Hull is
commercial ornamentals extension agent, Dade County, Florida.
















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 Dade County
Florida, rather than being typical of the foliage plant industry.
Data were collected for 1987 tax year. In some cases, data were received for a fiscal
year that did not coincide with the calendar year. Data for fiscal years ending after July 1,
1986, and before July 1, 1988 were included with this 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 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 all 21 nurseries, for the average of
the largest 7 firms, and for the smallest 7 firms. All firms in the largest group had sales of
own plants greater than $500,000, while all firms in the smallest group had sales less than
$200,000. 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 for the
particular measure, and the lower line designated "lowest rates" is the average for the lowest
third. Nursery operators analyzing their own operations may find this information especially
valuable for indicating the general area of their business needing additional study and analysis.
Nursery operators received an analysis for their own operation, which contained similar
information as used in this report, shortly after they supplied their data.






-lo -VW

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 Business1
Size of business data in 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 $1,040,954 for all nurseries, $2,650,626 for
the largest nurseries, and $113,783 for the smallest nurseries (Table 1).



1 See Appendix Table 1 on page 35 for complete data.










Table 1--Sates, bed and bench space, people, and capital, 21 foliage nurseries in
Dade County, Florida, 1987.
unit All Largest Smallest
Nurseries Third (7) Third (7)

Value of own plants sold . . . . ... .. 1,040,954 2,650,626 113,783
Change in inventory value. . . . . .... S 21,563 62,419 (10,023)
Total value of production. . . . . .... 1,062,517 2,713,045 103,760
Total bed & bench space . . . . .... sq.ft. 661,240 1,766,205 51,305
Number of persons employed . . . . . number 25.50 63.73 3.48
Owned Capital . . . . . . . ... . 1,091,829 2,512,880 253,387
Leased/rented capital items . . . ... .. 135,024 271,857 23,000
Managed Capital. . . . . . . .... $ 1,226,852 2,784,738 276,387

See Appendix Table 1 for more detail.






Figure 1

Sales and Total Value of Production

21 Dade County Foliage Nurseries, 1987


Dollars (Thousands)
3000


2500 -........ ...\\\\\\\\\\










500 S Sales IValue of Production


l Nurseries Largest Third S tallest Third
All Nurseries Largest Third Smallest Third










Total value of production during the year adjusts sales for change in the value of the
plant inventory. Increases in the value of plant inventory during the year mean the total
value of the year's productive activities was greater than sales. Decreases in the value of
plant inventory mean the total value of the productive effort was less than sales. Plant
inventory change was positive for the average of all nurseries and the largest firms, and was
negative for the smallest nurseries, giving a total value of production of $1,062,517,
$2,713,045, and $103,760 respectively (Table 1).



Monthly sales. Figure 2 shows the pattern of monthly sales for all nurseries, largest
nurseries and smallest nurseries. The pattern for all nurseries showed peaks in sales during
the months of January, March, September and December. Sales for these four months
accounted for 47 percent of the year's total sales. Sales for January, the highest month, were
$136,053, which was 48 percent greater than for February, the lowest month ($92,006).




Figure 2
Monthly Sales
21 Dade County Foliage Nurseries, 1987

Dollars (Thousands)
300

250 A

200 -
Largest Third
150 ..- ........ .... -- All Nurseries
S.10 Smallest Third


50 *

JanFebMar AprMayJun Jul AugSepOctNovDec
Month










Land. Labor and Capital
Land: bed and bench space. Total bed and bench space averaged 661,240 square feet for
all nurseries, 1.766 million square feet fo the largest nurseries, and 1,208 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 643,949 square feet for all nurseries, 1.744
million square feet for largest nurseries, and 50,134 square feet for the smallest nurseries.
Stock plant area is bed and bench space used exclusively for production of plants propagating
material. This area averaged 17,291 square feet for all nurseries, 22,311 square feet for the
largest firms, and 1,171 square feet for the smallest nurseries. Total nursery area, which
includes drives, roads, parking lots, office, packing house and the like, averaged 17.8 acres for
all nurseries, 45.4 acres for the largest firms, and 2.0 acres for the smallest.

Figure 3
Land: Bed and Bench Space
21 Dade County Foliage Nurseries. 1987
200Square Feet (Thousands)

..... ... ........... ..0 0.. ...........
ieOO


e00


All Nurerlee Largms Third Gmall-t Tird

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 25.5, for the largest it was 63.7, and for the smallest
nurseries it was 3.5 (Table 1 and Figure 4).
Figure 4
Labor: Number of Persons
21 Dade County Foliage Nurseries, 1987
Full-time Equlv. Persons (2080 hrs/yr)



40
0 .. ......... ........ ....



All Nurseries Latrget Third Srnallest Third










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
$1.092 million for all nurseries, $2.513 million for the largest firms, and $253,387 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 $1.227 million for all nurseries, $2.785 million for the largest nurseries, and $276,387
for the smallest nurseries (Table 1 and Figure 5).





Figure 5
Capital Managed
21 Dade County Foliage Nurseries, 1987


3000

2500

2000

1500

1000

500

0


Thousands)


All Nurseries Largest Third Smallest Third
Capital managed is owned plus leased.









Productivity Indicators
Land Use2
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 more important indicator. 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 $1.65 for
all nurseries, $1.56 for the largest firms, and $2.07 for the smallest. Value of production per
square foot of total bed and bench space (includes stock plant space) was $1.61 for all
nurseries, $1.54 for the largest firms, and $2.02 for the smallest (Figure 6). So, the smallest
nurseries had a 40 percent greater rate of production per square foot than the average of all
nurseries. Firms with the highest annual rates of production averaged $3.38 per square foot,
while those with the lowest averaged $.66 per square foot.

Figure 6
Land Use: Value of Production/Sq. Ft.
21 Dade County Foliage Nurseries, 1987

Dollars/Sq.Ft,
3.50
3,5 -B0 Highest Rates
3.00 I Lowest Rates

2.50

2.00-

1.50

1.00 .



0.00
All Nurseries Largest Third Smallest Third

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 $59,833, for the largest nurseries, $59,728, and for the smallest nurseries,
$52,160. The relationship between all nurseries and the smallest nurseries was reversed in this
case because of the greater percentage of land in non-growing area for the smallest
nurseries.


2 See Appendix Table 2 on page 35 for complete data.








In general, other things being equal, increasing sales per square foot of production area
should increase the profitability of a nursery operation. However, this does not necessarily
assure high profitability because other things may not be equal. On the other hand, lower
sales per square foot of bed and bench space can result from a number of things, such as
letting plants continue to grow after reaching salable size, letting space sit vacant too long
between the time a plant is sold and another is put in place to start growing again, selecting
varieties that grow slow or are priced low relative to their growing time and space
requirements, and having 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 $.603 for all nurseries, $.433 for largest nurseries. Plant
inventory per square foot was $1.97 for the smallest nurseries, or more than 3 times the
average of all 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.
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 261 percent. This means that annual
plant sales amounted to 2.61 times the average value of plant inventory. Vacant bed and
bench space averaged 5.4 percent of the total for all nurseries, 5.3 percent for the largest
third, and 4.8 percent for the smallest third3.
Labor Use4
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 $41,670 per person for all
nurseries, $42,573 for the largest firms, and $29,853 for the smallest (Figure 7).
Highest rates of production per person averaged $64,742, and lowest rates were $18,956.
This represented a range about the industry average of 52 percent above and 55 percent below
(Figure 7).
An indicator of intensity in the use of labor is production area per person. Total bed
and bench space per full-time equivalent person averaged 25,933 square feet for all nurseries,
27,716 square feet for the largest firms, and 14,761 square feet for the smallest. Stated
another way, the number of persons per acre of bed and bench space averaged 1.70 for all

3 See Appendix Table 4 on page 36 for complete data.

4 See Appendix Table 3 on page 36 for complete data.









nurseries, 1.57 for the largest nurseries, and 2.96 for the smallest nurseries. Thus, the smallest
foliage nurseries employed 77 percent more labor per unit acre than the average of all
nurseries.


Figure 7
Labor Use: Value of Production/Person
21 Dade County Foliage Nurseries, 1987

7Dollars/Employee Equivalent (Thousands)
I I I I



40 ............. ... Lowest Rates

30

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


10
All Nurseries Largest Third Smallest Third



If all other things are equal, higher sales per person involved is desirable. However,
seldom are all other things equal. For example, higher sales per person when viewed alone
might seem to indicate true efficiency, but when viewed together with other indicators, it
might instead show less than optimum number of employees for the volume of plants being
handled or space being cared for. This could result in tardy or untimely plant care, hence,
slower growth and/or lower quality plus a failure to restock empty space promptly. In this
case, other indicators such as production rate, space use intensity, capital turnover, and costs
per square foot would not support the labor efficiency indicator.
Lower sales per person can result during periods of rapid expansion when extra help is
needed to care for a larger numbers of plants before they reach salable size. Lower sales
person also can result during difficult economic times when sales are slow, but plant care
must continue. Variations among nurseries can be the result of differences in investment in
labor saving capital items, differences in any of the factors noted above that lower
production rate, or poor management practices in the utilization of labor.








Capital Use5
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 95.3 percent, for the largest nurseries 105.5 percent, and for smallest
44.9 percent (Figure 8). This means that for the average of all nurseries and largest nurseries,
annual sales were nearly equal to the capital investment. For the smallest nurseries, sales
amounted to less than half of capital investment. Highest capital turnover rates averaged
137 percent, while lowest rates averaged 40 percent (Figure 8).



Figure 8
Capital Turnover
21 Dade County Foliage Nurseries, 1987

Sales as a Percentage of Capital Owned
160%
140% .............. Highest Rates
120% ... ............ Lowest Rates
1 0 0 % .. . ...... .......................................................
80% -
60%


20% . .
0%
All Nurseries Largest Third Smallest Third



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 hence 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, or expensive (though maybe unnecessary) niceties will
also tend to lower the cap.ial turnover rate.


5 See Appendix Table 5 on page 36 for complete data.












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 $48,115 for all nurseries, $43,698 for the largest nurseries, and $79,520 for the
smallest nurseries (Figure 9). Highest rates for capital managed per person averaged $96,657
per person, or about twice that of all nurseries. Lowest rates were $32,169 per person, about
two-thirds of the all-nursery average (Figure 9).





Capital Managed Per Acre. Capital managed per acre of total nursery area averaged
$69,087 per acre for all nurseries and $61,306 for the largest firms. The average investment
per acre for the smallest nurseries ($138,940) was nearly twice as high as that for the average
of all nurseries. Highest rates of capital managed per acre were even higher at $243,115.
Lowest rates averaged $52,138 per acre (Figure 10).


Figure 9
Capital Managed Per Person
21 Dade County Foliage Nurseries, 1987

Dollars per Person (Thousands)







0 -
All Nhrgrtwie Lge~tIl Thinl Smnl let Third


Figure 10
Capital Managed Per Acre
21 Dade County Folage Nurerles. 1987
Dollars/Acre (Thousands)

260 ...... ..............





o00 .\ew t ...... .e i-. ........
100




A* M1nwi LmIgt wTll iMl Th~


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
1987. Growing plants in inventory represented the largest share of capital managed, 32.5
percent. Next in importance was buildings (22.3 percent) and land (21.1 percent). Other lesser
areas of capital managed were accounts receivable (16.5 percent), machinery and equipment
(3.9 percent), and supplies (.7 percent).






Figure 11
Distribution of Managed Capital
21 Dade County Foliage Nurseries, 1987

Plants
32,5%

Land
21,1%


Machinery & Equip.
3.9%


Buildings & install
22.3%


Accounts receivable
16.5%

Supplies & Cash
3.8%


Includes


capital


plus capital


owned


leased










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 Category6
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 Dade County, 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 $65,518 for all nurseries, $129,937 for the largest nurseries, and
$25,811 for the smallest nurseries. Wages, salaries, and associated expenses for employees
averaged $310,671 for all nurseries, $808,754 for the largest, and $27,556 for the smallest.
Thus, total expenses on wages and salaries averaged $376,189 for all nurseries, $938,690 for
the largest, and $53,367 for the smallest nurseries (Table 2).

Table 2--Costs by expense category, 21 foliage nurseries in Dade County, FLorida, 1987.

Atl Nurseries Largest Third (7) Smallest Third (7)


Labor Total . . . . ... $376,189 32.4% $938,690 32.1% $53,367 33.3%
Supplies Total . . . .... $364,352 31.4% 5940,651 32.2% $39,095 24.4%
Other Production Costs Total.. $53,780 4.6% $141,451 4.8% $6,169 3.9%
Administrative & Overhead Costs $159,551 13.8% $411,048 14.1% $17,277 10.8%
Total Cash Costs ..... ..$953,872 82.3% $2,431,840 83.3% $115,907 72.4%
Total Non-Cash Costs . .. $205,482 17.7% $488,362 16.7% $44,174 27.6%
Total ALL Costs ........ ..$1,159,354 100.0% $2,920,203 100.0% $160,082 100.0%

See Appendix Tables 6 and 7 for more detail.


6 See Appendix Table 6 on page 37 for complete data.










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 $364,352, for the largest nurseries $940,651, and for smallest nurseries
$39,n95.
Other production costs. Other production costs are facility repairs/maintenance and
equipment operating costs. For all nurseries they averaged $53,780, for the largest nurseries
$141,451, and for the smallest $6,169.
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
$159,551 for all nurseries, $411,048 for the largest, and $17,277 for the smallest.
Total cash costs. Total cash costs, including all items mentioned above, averaged
$953,872 for all nurseries, $2,431,840 for the largest, and $115,907 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
$205,482 for all nurseries, $488,362 for the largest, and $44,174 for the smallest firms.
Total all costs. The sum of all cash costs and non-cash cost allowances averaged
$1,159,354 for all nurseries. It was close to three times this, or $2,920,203 for the largest
nurseries, and $160,082 for the smallest.






Costs as a Percent of the Total Cost7
While expenditures show the magnitude of expenses for various cost categories, they are
not very helpful for comparing cost relationships with industry averages which may represent
a significantly different size of business. But costs in terms of percentage of the total are
useful for this purpose. Distribution of costs of production by category are shown graphically
for the average of all nurseries in Figure 12.




7 See Appendix Table 7 on page 38 for complete data.






Figure 12
Distribution of Costs of Production
21 Dade County Foliage Nurseries, 1987


Labor
32%


Supplies
31%


Non-cash costs
18%


Other prod, costs
5%


Admin, & overhead
14%












Salaries and wages. Salaries and wages (includes operator) as a percentage of total costs
were quite uniform across the industry, averaging, 32.5 percent of total costs for all nurseries,
32.1 percent for the largest, and 33.3 percent for the smallest nurseries (Table 2). The
smallest container nurseries reported a significantly higher percentage of costs in operator
salaries (16.1 percent) than the industry average (5.7 percent), but a lower percentage in
employees wages and salaries (17.2 percent vs. 26.8 percent). Employees wages and salaries
were highest for the largest nurseries (27.7 percent).
Production supplies. Expenses for production supplies fluctuated considerably among
nurseries. Average costs for all nurseries were 31.4 percent of total costs, for the largest
nurseries 32.2 percent, and for the smallest nurseries 24.4 percent. The greatest share of
expenses for this category was "plants and seeds" (8.6 percent to 13.1 percent). Expenses for
growing containers were 3.6 percent for all three groups. Expenses on shipping materials
showed the largest proportional variation, being 1.9 percent for the smallest nurseries, 3.3
percent for all nurseries, and 3.5 percent for the largest.
Other production costs. Other production costs averaged 4.6 percent for all nurseries, 4.8
percent for the largest, and 3.9 percent for the smallest nurseries.
Administrative and overhead. Overhead costs ("travel" through "other cash expense")
averaged 13.8 percent of total costs for all nurseries, 14.1 percent for the largest, and 10.8
percent for the smallest. Thus. counter to expectations, there is no indication of economy of
scale for these overhead expenses.
Total cash costs. Total cash costs as a percent of all costs for container nurseries were
very close for the average of all nurseries and the largest nurseries (82.3 percent and 83.3
percent). The smallest container nurseries were about 10 points lower, at 72.4 percent.
Non-cash costs. Non-cash costs ("depreciation" through "interest on capital") averaged
17.7 percent of total costs for all nurseries, 16.7 percent for the largest, and 27.6 percent for
the smallest. Thus, the lower percentage cash costs for the smallest nurseries were offset by
their higher percentage non-cash costs. The greatest share of differences in non-cash costs
were due almost entirely to interest on capital: 11.3 percent for all nurseries, 10.3 percent for
largest, and 19.0 percent for the smallest. Depreciation on equipment, buildings, and other
property improvements ranged from 6.4 to 8.5 percent.










Cost Efficiency
While expenses as a percent of total costs facilitate comparing operating statements, they
do not allow easy comparison of growing costs in relation to the physical factors of
production or to product revenue. Costs per square foot and costs per dollar of sales and
production are important indicators for these comparisons.


Costs Per Square Foot of Bed and Bench Space8
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 $1.75 for all nurseries, $1.65 for the
largest, and $3.12 for the smallest (Figure 13). Highest rates of cost per square foot averaged
$4.15, and lowest rates averaged $1.29 (Figure 13). This gave a broad range of $2.86 per
square foot.
Cash costs per square foot (excluding depreciation, interest, etc.) averaged $1.44 for all
nurseries, $1.38 for the largest, and $2.26 for the smallest nurseries.


Figure 13
Costs/Square Foot of Bed & Bench Space
21 Dade County Foliage Nurseries, 1987


500Dollars/Sq.Ft' -4- Highest Rates
Lowest Rates
4.00- -. Non-cash costs
S Cash Costs
3.00

2.00 ... ......

1.00 ....

0.00
All Nurseries Largest Third Smallest Third




8 See Appendix Table 8 on page 39 for complete data.









Cost Per Sauare Foot of Propagating and Finishing Space9
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 $1.80, largest nurseries $1.68,
and smallest firms $3.19 (Figure 14). Highest rates averaged $5.95 per square foot. Lowest
rates were $1.51 (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, not checking for best price before purchasing needs, and not carefully managing the
nursery operation. Other causes of increased costs may not be a problem if they result in
increased revenue.



Figure 14
Costs/Square Foot of Prop. & Fin. Space
21 Dade County Foliage Nurseries, 1987

Dollars/Sq.Ft,
7.00

600- -- --- Highest Rates

500 Lowest Rates
I Non-cash costs
400 Cash Costs
300
3 .0 0.- . .... ........... ..... .........

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

2.00

0. 00 _____
All Nurseries Largest Third Smallest Third





9 See Appendix Table 9 on page 40 for complete data.








Costs Per Dollar's Worth of Production10
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 $1.09, for the largest nurseries its was $1.08, and for the
smallest nurseries $1.54 (Figure 15). Thus, average total costs for all nurseries were 9 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) were adequately covered by the value of
production for the average of all nurseries and the largest third, but not for the smallest
third.
Highest rates for costs per dollar's worth of production averaged $1.72. Lowest rates were
at the breakeven point of $1.00 (Figure 15).



Figure 15
Costs Per Dollar's Worth of Production
21 Dade County Foliage Nurseries, 1987

Dollars/Dollar
2.00


1.50-

Breakeven Cet--, Highest Rates
\1.00 - --1 "\\ Lowest Rates
1 Non-cash costs
0.50 . ......-. Cash Costs


0.00
All Nurseries Largest Third Smallest Third



10 See Appendix Table 10 on page 41 for complete data.








Cash Costs Per Dollar's Worth of Sales 1
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. Average cash costs per dollar of sales were $.92 for
all nurseries and largest nurseries, and $1.02 for the smallest (Figure 16). These results
indicate a rather serious problem for the smallest nurseries, since they were running a deficit
of 2 cents between sales and current operating expenses. Highest cost firms averaged $1.09 per
dollar of sales, and lowest cost firms had cash costs of $.81 per dollar of sales (Figure 16).

Figure 16
Cash Costs Per Dollar's Worth of Sales
21 Dade County Foliage Nurseries, 1987

Dollars/Dollar
1.20

1 .1 0 .... ... .. ... ............ ........... ........ .............
Breakeven Cost
1.0 0 .............

0.90
^ HHighest Rates
0.80 Lowest Rates

0.70
All Nurseries Largest Thira Smallest Third
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. While prices received are not always under the direct control
of the nursery operator, other things mentioned earlier are under his or her direction that
affect rates of production, level of costs, and labor efficiency. Examples include letting
plants continue to grow after reaching salable size without getting any price premium for
them, letting space sit vacant too long after plants are sold, selecting varieties that grow
slower or are priced low relative to their growing time and space requirements, having disease

11 See Appendix Table II on page 42 for complete data.










and quality problems that reduce the yield of salable plants, failing to plan and manage for
efficient utilization of labor, ignoring needed investments in labor saving equipment and
facilities, not shopping for the best price before purchasing needs, experiencing theft or
destruction of plants or supplies, practicing less than optimum fertilizing and growing
techniques, and pursuing less desirable markets and marketing programs.





Income Summary12
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. After all is said and done, it is for a payment on his or her time that a
nursery operator works, and it is for a return to capital that nursery operators and lending
institutions invest funds in nursery operations. Figure 16 shows the components of income
summarized, and Table 3 arrays the data used for the figure.

Table 3--Income Summary, 21 foliage nurseries in Dade County, Florida, 1987.

unit All Largest Smallest
Nurseries Third (7) Third (7)

TOTAL GAIN . . . . . . . .... 1,071,268 2,728,118 107,400
Total Cost Deductions. . . . . .... .. (962,817) (2,488,720) (103,864)
NET NURSERY INCOME . . . . . .... 108,451 239,397 3,536
Operator's salary or time value. . . .... S (65,518) (129,937) (25,811)
RETURN TO CAPITAL. . . . . . .... .. 42,933 109,460 (22,275)
X 3.93 4.36 -8.79
See Appendix Table 12 for more detail.

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 $634 for all nurseries, $2,539 for the largest firms, and
smallest nurseries had none. 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 $8,117 for all nurseries, $12,534 for the largest, and $3,640 for
the smallest firms. Total gain averaged $1,071,268 for all nurseries, $2,728,118 for the largest
nurseries, and $107,400 fcr the smallest.



12 See Appendix Table 12 on page 43 for complete data.








Figure 17
Distribution of Total Gain
21 Dade County Foliage Nurseries, 1987

Dollars (Thousands)
3000

2500 -

2000

1500 ....' Return to Capital
C~ Return to Operator
1000 .. .. Expenses...

500 -

0

-500
All Nurseries Largest Third Smallest Third




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 $962,817 for
all nurseries, $2,488,720 for the largest firms, and $103,864 for the smallest.
Net nursery income is the total return for the year for the time and managerial skills of
the operator plus the capital invested in the operation. Average net nursery income was
$108,451 for all nurseries, $239,397 for the largest, and $3,536 for the smallest nurseries.
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 $42,933 for all nurseries, $109,460 for the largest nurseries, and minus
$22,275 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, which are reported on an annualized basis unless otherwise noted.
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 3.9 percent for all nurseries, 4.4 percent for
the largest nurseries, and minus 8.8 percent for smallest. Thus, for every dollar invested in
these foliage nurseries, there was an average return of 3.9 cents. The deficit of 9 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.
Highests rates of return on capital were 25.9 percent. Lowest rates averaged a minus
22.9 percent (Figure 18).




Figure 18
Return to Capital
21 Dade County Foliage Nurseries, 1987

SPercentage Profit to Capital Owned
320%
2 0 % . . .... . ...... ..... ..... ...... . .. ... . .. .......... .. ........... ....

1 0 % .. .. ... .. . .. .. ..........

0% \\ \\ 1 -- Highest their
=-4- Lowest third
1 0 % ....... .. ... .... ............ .... .... .......... ........


I -II I I

-30%
All Nurseries Largest Smallest












Statement of Financial Position13
The statement of financial position summarizes the assets and liabilities of foliage
nurseries. These data represent the mid-year financial situation of the nurseries, derived as an
average of the beginning of the year and ending of the year balance sheet figures. Figure 19
illustrates the major components of the statement of financial position for foliage nurseries.
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 $37,863 for all nurseries, $88,589 for the largest nurseries,
and $13,442 for the smallest firms. The main function of cash on hand is to pay for current
liabilities. As a percentage of total cash costs, these current liabilities represented 4.0 percent,
3.6 percent, and 11.6 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 $201,860 for all
nurseries, $554,789 for the largest, and $10,160 for the smallest firms. As a percentage of
annual sales, these amounts represented 19.4 percent, 20.9 percent, and 8.9 percent,
respectivley. So, the smallest nurseries were considerably better in collecting on account, or
were more averse to accepting sales on credit.
Inventory values include growing plants and supplies, which were presented previously in
Table 1. The combined value of inventories averaged $407,578 for all nurseries, $783,073 for
the largest firms, and $104,665 for the smallest nurseries.
Total current assets averaged $647,301 for all nurseries, $1,426,451 for the largest, and
$128,268 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 $756,350 for all nurseries, $1,847,540 for the
largest, and $176,559 for the smallest nurseries. Subtracting accumulated depreciation left a


13 See Appendix Table 13 on page 43 for complete data.








Figure 19

Assets and Liabilities

21 Dade County Foliage Nurseries, 1987


Dollars (Thousands) M Current,
3000
[E0 Long Ter

2500 ....... ......... [ I Current I
*ii Long Ter

5000 .... ..Net Wort





1000 ......

0 1e
,oeeeeeooeeeoo, O
ee
,oee eeeeoe 4,
::%: to, .......
::: :;.-, .. ...
ooeooeeeeol
,.% ... ... .
[ .. .. % .Z.'...


All Nurs, Largest


Smal lest









cunent ...ue of $444,528 for all nurseries, $1,086,429 for the largest, and $125,119 for the
smallest nurseries. As a percentage of the original investment, these current values
represented 58.8 percent for the average of both all nurseries and largest nurseries, and 70.9
percent for the smallest. Thus, the smallest nurseries had the least depleted long term assets.
Total assets. The sum of current and long term assets gives average total assets of
$1,091,829 for all nurseries, $2,512.880 for the largest, and $253,387 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 $63.594 for all nurseries, $168,154 for the largest, and $6,002
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 was equally\ good for all groups, averaging 3.77 for all nurseries,
3.83 for the largest firms, and 3.93 for the smallest nurseries.
Lone term liabilities include notes payable and mortgages. They averaged $288,566 for all
nurseries, $648,958 for the largest, and S78.647 for the smallest nurseries. The ratio of current
liabilities to long term liabilities was .22 for all nurseries, .26 for largest, and .08 for the
smallest firms.
Total liabilities. The sum of current and long-term liabilities gives average total liabilities
of $352,160 for all nurseries, 5817.111 for the largest, and $84,649 for the smallest firms. The
ratio of total assets to total liabilities was quite constant across groups, 3.1, 3.1, and 3.0,
respectively, which represents an extremely 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 $739,669, for the largest it was $1,695,769, and for the
smallest $168.738.














Total Profitability Model
The Total Profitability Model combines information from the operating statement and
statement of financial position in a graphical presentation to illustrate how assets, liabilities,
and profit margins 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
(middle box) will be discussed to illustrate the operation of the model.





Margin Management
From total gain ($1,071,268) is subtracted total deductions ($962,817) and the operator's
salary ($65,518) to give return to capital ($42,933). This is divided by total gain to yield an
average net profit margin of 4.0 percent.


Asset Management
Current assets ($647,301) plus long term assets ($444,528) make total assets of $1,091,829.
This is divided into total gain ($1,071,268) to give an asset turnover rate of .98. Asset
turnover multiplied by net profit margin (4.0 percent) results in an average return to capital
of 3.9 percent.


Leverage Management
Current liabilities ($63,595) plus long term liabilities ($288,566) gives average total
liabilities of $352,160. This is subtracted from total assets to yield average net worth of
$739,669. Total liabilities plus net worth ($1,091,829) divided by net worth gives a leverage
factor of 1.48. This is really the ratio of total assets under one's control to net worth.
Leverage times rate of return to capital (3.9 percent) gives a return on net worth of 5.8
percent.











MARGIN MANAGEMENT


NET PROFIT
MARGIN


LONG TERM ASSETS


LEVERAGE MANAGEMENT


TOTAL LIABILITIES


Figure 20.--Total profitability model, 21 foliage nurseries in Dade County
Florida, 1987


RETURN ON
NET WORTH











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. The Appendix tables are structured for this purpose. The formulas for making these
calculations are shown for each line in Appendix Tables 2 through 5. The results may be
written on the lines provided for this purpose on each table. Another alternative is to
acquire the University of Florida microcomputer program, FOLAGNBA.BAS, for making these
calculations. Either alternative should provide some valuable insight into the business side of
operating a foliage plant nursery. It should improve management decisions concerning things
that affect the profitability of the nursery operation.
Nursery operators who find this kind of information useful, but have difficulty finding
the time or energy to engage in the tedium of doing their own calculation 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 nearby 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.





77-









APPENDIX
Appendix Table of Contents
gage
D efinitions . . . . . . . . . . . . . . .. . . . . . 32
Making your own calculations ..................... ....... 33
Appendix Tables ................... ................... 35


List of Appendix Data Tables

Appendix Table Page

1 Size of business, 21 foliage nurseries in Dade County, Florida, 1987 . . ... 35

2 Rates of production, 21 foliage nurseries in Dade County, Florida, 1987 . . .. 35

3 Land use indicators, 21 foliage nurseries in Dade County, Florida, 1987 . . .. 35

4 Labor ule indicators, 21 foliage nurseries in Dade County, Florida, 1987 . . .. 36

5 Capital use indicators, 21 foliage nurseries in Dade County, Florida, 1987 . . .. 36

6 Costs by expense category, 21 foliage nurseries in Dade County, Florida,
1987 . . . . . . . . . . . . . . . . . .37

7 Percent of total costs by expense category, 21 foliage nurseries in Dade County,
Florida, 1987 . . . . . . . . . . . . . . . . 38

8 Costs per square foot of bed and bench space, 21 foliage nurseries in Dade
County, Florida, 1987 . . . . . . . . . . . . .. 39

9 Costs per square foot of propagating and finishing space, 21 foliage nurseries
in Dade County, Florida, 1987 .. .. . .. . . . . . .. .. 40

10 Costs per dollar's worth of production, 21 foliage nurseries in Dade County,
Florida, 1987 . . . . . . . . . . . . . . ... 41

11 Cost per dollar's worth of sales (no adjustment for change in plant
inventory), 21 foliage nurseries in Dade County, Florida, 1987 . . ... 42

12 Income summary, 21 foliage nurseries in Dade County, Florida, 1987 . . ... 43

13 Statement of Financial Position, 21 foliage nurseries in Dade County,
Florida, 1987 . . . . . . . . . . . . . . . .. 43












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 of 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


For those who wish to analyze their own operation and compare the results with the
findings of this report, there are two options. One is a manual method. To do it manually,
you need to collect for your nursery the data shown in Appendix Tables 1 and 6. Lines are
provided for entry of your data. Then, calculate your nursery data for each line of Appendix
Tables 2, 3, 4 and 5. The formula for making that calculation is 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 IA/IE. The slash mark (/) stands for division. The Table 1A
stands for the A line of Appendix Table 1, and IE stands for the E line. Hence, to calculate
your "Sales per square foot", divide your sales figure on line A of Appendix Table 1 by your
square feet of growing area on line E of Appendix Table 1. And so on for each line of
Appendix Tables 2, 3 and 4.
Calculations starting with Appendix Table 7 and continuing through Appendix Table 11
are similar. These calculations are made by dividing each line of Appendix Table 6 by the
appropriate figure as follows:

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

For Appendix Table 8, divide your data in Appendix Table 6 by your square footage
figure on line E of Appendix Table 1.

For Appendix Table 9, divide your data in Appendix Table 6 by your square footage
figure on line C of Appendix Table 1.

For Appendix Table 10, divide your data in Appendix Table 6 by your total value of
production figure on line B of Appendix Table 1.

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

For Appendix Tables 12 and 13, formulas are not shown. However completion of your own
data set for those tables is 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 . . .


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 . . .


Appendix Table IA
Appendix Table 1B-1A
from your beginning and ending
supply inventory data, not
calculated previously
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 P











Instructions for Appendix Table 13 are as follows:


Line A: Cash on hands . . . .... Appendix Table 1 line O
Line B: Accounts Receivable . . ... Appendix Table 1 line N
Line C: Plant inventory . . . ... Appendix Table 1 lime I
Line D: Supply inventory . . . ... Appendix Table 1 line M
Line E: Total current assets . . ... sum lines A,B,C and D
Line F: Machinery & Equipment. . . ... Appendix Table 1 line K
Line G: Buildings and fixtures ...... Appendix Table I line J
Line H: Land. . . . . . . .. Appendix Table 1 line L
(Skip lines I and J if lines F, G and H are depreciated values.
If not, use these two lines to get depreciated values.)
Line K: Total long term assets ...... sum lines F,G and H
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 O: Total liabilities . . . ... sum line M and N
Line P: Net worth . . . . . . line L minus line O
Line Q: Total liabilities and net worth. . sum lines O and P

This data required for the profitability model.

A second alternative for performing your own business analysis for those of you who
have an MSDOS computer is to order IFAS microcomputer program number 002, FOLAGNBA
for a cost of $20. Mailing address is:

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

This program still requires you to collect the same data requested for the manual
calculation method described above, but once the data is entered, all calculations will be done
automatically for you.








Appendix Table 1--Size of business, 21 foliage nurseries in Dade County, Florida, 1987.


unit All Largest
Nurseries Third (7)


Smallest Your
Third (7) Nursery


A Value of own plants sold . . . . .... .
B Total value of production. . . . . ... .

C Space for propagating & finishing . . ... sq.ft.
' Space for stock plants . . . . .... sq.ft.

E Total bed & bench space. . . . . . ... sq.ft.

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

H Full-time equivalent persons employed . . .number


............Capital Owned-- -----..
I Growing plants . . . . . . . . .
J Bldgs, fences, wells . . . . . . .
K Machinery & equipment . . . . . .
L Land . . . . . . . . . . .
M Supply inventory . . . . . . . .
N Accounts receivable . . . . . . .
0 Cash/checkbook balance . . . . . . .

P Total Owned Capital . . . . . . .
............Capital Managed--.........
0 Growing plants . . . . . . . . .
R Bldgs, fences, wells . . . . . . .
S Machinery & equipment . . . . . .
T Land . . . . . . . . . . .
U Supply inventory . . . . . . . .
V Accounts receivable . . . . . . .
W Cash/checkbook balance . . . . . . .

X Total Managed Capital . . . . . . .


1,040,954 2,650,626 113,783
1,062,517 2,713,045 103,760

643,949 1,743,894 50,134
17,291 22,311 1,171

661,240 1,766,205 51,305


773,545 1,978,646
17.76 45.42


25.50


S 398,587
S 257,022
S 46,298
S 141,208
$ 8,991
S 201,860
$ 37,863

S 1,091,829


S 398,587
S 273,275
$ 47,560
S 258,717
S 8,991
S 201,860
$ 37,863

$ 1,226,852


63.73


764,127
660,722
116,014
309,694
18,946
554,789
88,589

2,512,880


764,127
660,722
119,585
577,980
18,946
554,789
88,589

2,784,738


86,652
1.99

3.48


101,081
47,780
13,267
64,071
3,584
10,160
13,442

253,387


101,081
48,852
13,267
86,000
3,584
10,160
13,442

276,387


Appendix Table 2--Rates of production, 21 foliage nurseries in Dade County, Florida, 1987.

unit ALL Largest Smallest Your
Nurseries Third (7) Third (7) Nursery


Plant sales/sq.ft. bed & bench space .(Table 1A/1E) cents 157.4 150.1 221.8
Value of production/sq.ft. ..... ..(Table 1B/1E) cents 160.7 153.6 202.2

Sales/sq.ft. prop. & finish area. . (Table 1A/1C) cents 161.7 152.0 227.0
Value of prod./sq.ft. prop.& finish (Table 1B/1C) cents 165.0 155.6 207.0

Plant sales/acre total nursery area (Table 1A/1G) S 58,618 58,354 57,199
Value of production/acre. ...... (Table 1B/1G) S 59,833 59,728 52,160





Appendix Table 3--Labor Use Indicators, 21 foliage nurseries in Dade County, Florida, 1987.
unit All Largest Smallest Your
Nurseries Third (7) Third (7) Nursery
..............................................................................


Sales/person* . . . . . (Table 1A/H)
Value of production per person* . (Table 1B/1H)


S 40,825
S 41,670


41,594 32,737
42,573 29,853


Total bed & bench space/pe.son* . (Table 1E/1H) sq.ft.
Prop. & finishing space/person* . (Table IC/1H) sq.ft.
Total nursery area/persor*. . . .(Table 1F/1H) sq.ft.


* Full-time equivalent person (2080 hours per year)


25,933
25,255
30,337


27,716
27,365
31,049


14,761
14,424
24,931












Appendix Table 4--Space Use Indicators, 21 foliage nurseries in Dade County, Florida, 1987.

unit ALL Largest Smallest Your
Nurseries Third (7) Third (7) Nursery


Plant inventory turnover . . . .(Table 11/1A) X

Average vacant bed & bench space. . . . ... sq.ft.
*-percentage of bed & bench space. . . ... ..

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

Total bed & bench space . . . . . . ..sq.ft.
--percentage of total nursery area .(Table 1E/1F) X

Prop. & finishing space . . . . . . ..sq.ft.
--percentage of total growing space. .(Table 1C/1E) X

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


261.2

35,366
5.4


346.9 112.6

93,967 2,465
5.3 4.8


773,545 1,978,646


661,240
85.5

643,949
97.4

17,291
2.6


1,766,205
89.3


86,652


51,305
59.2


1,743,894 50,134
98.7 97.7


22,311
1.3


1,171
2.3


Appendix Table 5--Capital Use Indicators, 21 foliage nurseries in Dade County, Florida, 1987.
unit All Largest Smallest Your
Nurseries Third (7) Third (7) Nursery
........................................................................................................


Owned capital turnover . . ... (Table 1A/1P)
Managed capital turnover . . ... (Table 1A/1X)

Capital owned/person* . . ... (Table 1P/1H)
Capital managed/person* ....... (Table 1X/1H)

Capital owned/acre. . . . ... (Table 1P/1G)
Capital managed/acre. . . . ... (Table 1X/1G)


X 95.3
X 84.8

S 42,820
$ 48,115

$ 61,483
$ 69,087


105.5
95.2


44.9
41.2


39,432 72,903
43,698 79,520

55,321 127,378
61,306 138,940


---Managed Capital Per Person* In---
Growing plants . . . . . (Table
Bldgs, fences, wells . . . ... (Table
Machinery & equipment . . ... (Table
Land . . . . . . .. (Table
Accounts receivable . . . . (Table
-------- Managed Capital Per Acre In--------
Growing plants . . . . . (Table
Bldgs, fences, wells . . . (Table
Machinery & equipment ....... (Table
Land . . . . . . .. (Table
Accounts receivable . . . . (Table


1Q/1H)
1R/1H)
1S/1H)
1T/1H)
1V/1H)

10/1G)
1R/1G)
1S/1G)
1T/1G)
1V/1G)


------P percent Capital Managed In-------
in growing plants . . . ... (Table 1Q/IX)
in buildings & wells. . . . ... (Table 1R/1X)
in machinery & equipment. . . ... (Table 1S/1X)
in land . . . . . . .. (Table 1T/1X)
in supply inventory . . . . (Table 1U/1X)
in accounts receivable . . ... (Table 1V/1X)
in cash/checkbook balance . . .. (Table 1W/1X)

TOTAL . . . . . . . . . . .


* Full-time equivalent pe-son (2080 hours per year)


15,632
10,717
1,865
10,146
353


22,445
15,389
2,678
14,569
506


32.5
22.3
3.9
21.1
0.7
16.5
3.1

100.0


11,991
10,368
1,877
9,070
297


16,822
14,546
2,633
12,724
417


27.4
23.7
4.3
20.8
0.7
19.9
3.2

100.0


29,082
14,055
3,817
24,743
1,031

50,814
24,558
6,669
43,232
1,802

36.6
17.7
4.8
31.1
1.3
3.7
4.9

100.0









Appendix Table 6--Costs by expense category, 21 foliage nurseries in Dade County, Florida, 1987.


unit ALL Largest Smallest Your
Nurseries Third (7) Third (7) Nursery


Operator's salary ............... $ 65,518 129,937 25,811
Other wages .................. S 310,671 808,754 27,556

LABOR TOTAL .................. $ 376,189 938,690 53,367

Plants & seeds. ............... S 152,258 389,302 13,820
Containers. ................. S 41,800 106,258 5,776
Heating fuel. ....... ......... .. $ 8,554 23,522 876
Peat & soil .................. $ 34,429 86,453 5,503
Fertilizers & Lime. .............. S 28,491 74,122 4,238
Pesticides & chemicals. ........... S 27,206 74,183 2,671
Shipping supplies .. . . . ....... 38,210 101,794 3,058
Other production supplies ........... $ 33,404 85,016 3,154

SUPPLIES TOTAL. ............... $ 364,352 940,651 39,095

Facility repairs. ..... .......... $ 43,736 119,336 3,427
Equipment operation ..... ........ $ 10,044 22,115 2,741

OTHER PRODUCTION COSTS TOTAL. ........ S 53,780 141,451 6,169

Travel. . . . . . . . . . . $ 10,688 23,573 1,679
Insurance ................... S 26,686 68,188 3,734
Telephone ..... .... ....... $ 10,357 23,828 1,519
Electricity . . . . . . . . . $ 6,195 13,187 1,721
Taxes & liscenses ............... $ 8,688 20,539 2,645
Advertising ......... ........ $ 8,078 20,219 1,470
Rent-land/buildings .............. $ 11,440 30,311 370
Other cash costs. .............. $ 77,418 211,204 4,139

ADMINISTRATIVE & OVERHEAD COSTS TOTAL .. .. S 159,551 411,048 17,277

TOTAL CASH COSTS. . . . . . . $. 953,872 2,431,840 115,907

Depreciation-machinery/equipment ........ $ 25,877 63,704 4,444
Depreciation-buildings/etc. . . . . .. $ 48,585 123,112 9,144
Supply inventory decrease ......... .. $ 0 0 180
Interest on capital . . . . .. $ 131,019 301,546 30,406

TOTAL NON-CASH COSTS. ........... $ 205,482 488,362 44,174

TOTAL ALL COSTS . . . . . ..... $ 1,159,354 2,920,203 160,082
===================================================================









Appendix Table 7--Percent of total costs by expense category, 21 foliage nurseries in
Dade County, Florida, 1987.

unit All Largest Smallest Your
Nurseries Third (7) Third (7) Nursery

Operator's salary ............... % 5.7 4.4 16.1
Other wages .................. X 26.8 27.7 17.2

LABOR TOTAL .................. % 32.4 32.1 33.3

Plants & seeds. ................ X 13.1 13.3 8.6
Containers. . . . . .. . .. . X 3.6 3.6 3.6
Heating fuel. . . . . . . . ... X 0.7 0.8 0.5
Peat & soil . . . . . . . . . % 3.0 3.0 3.4
Fertilizers & lime. . . . . . . ... X 2.5 2.5 2.6
Pesticides & chemicals. . . . . . ... X 2.3 2.5 1.7
Shipping supplies ............. % 3.3 3.5 1.9
Other production supplies ........... X 2.9 2.9 2.0

SUPPLIES TOTAL. ................ X 31.4 32.2 24.4

Facility repairs. . . . . . . . X 3.8 4.1 2.1
Equipment operation .............. X 0.9 0.8 1.7

OTHER PRODUCTION COSTS TOTAL. .......... % 4.6 4.8 3.9

Travel. ................... % 0.9 0.8 1.0
Insurance . . . . . . . .... % 2.3 2.3 2.3
Telephone . . . . . . . . . X 0.9 0.8 0.9
Electricity . . . . . . . ... % 0.5 0.5 1.1
Taxes & liscenses ............... % 0.7 0.7 1.7
Advertising . . . . . . . ... % 0.7 0.7 0.9
Rent-land/buildings . . . . . . . % 1.0 1.0 0.2
Other cash costs. . . . . . . ... % 6.7 7.2 2.6

ADMINISTRATIVE & OVERHEAD COSTS TOTAL ..... % 13.8 14.1 10.8

TOTAL CASH COSTS. ................ X 82.3 83.3 72.4

Depreciation-machinery/equipment ........ X 2.2 2.2 2.8
Depreciation-buildings/etc. .......... % 4.2 4.2 5.7
Supply inventory decrease ........... % 0.0 0.0 0.1
Interest on capital . . . . . .... X 11.3 10.3 19.0

TOTAL NON-CASH COSTS. .............. X 17.7 16.7 27.6

TOTAL ALL COSTS .. ....... ....... X 100.0 100.0 100.0








Appendix Table 8--Costs per square foot bed and bench space, 21 foliage nurseries in
Dade County, Florida, 1987.

unit ALL Largest Smallest Your
Nurseries Third (7) Third (7) Nursery


Operator's salary .............. .cents 9.9 7.4 50.3
Other wages ................. .cents 47.0 45.8 53.7

LABOR TOTAL ................. .cents 56.9 53.1 104.0

Plants & seeds. .............. .cents 23.0 22.0 26.9
Containers. ................ cents 6.3 6.0 11.3
Heating fuel. ............... .cents 1.3 1.3 1.7
Peat & soil . .. .. . . . . .cents 5.2 4.9 10.7
Fertilizers & Lime. ............. cents 4.3 4.2 8.3
Pesticides & chemicals. ........... cents 4.1 4.2 5.2
Shipping supplies .. . . ........cents 5.8 5.8 6.0
Other production supplies ........... cents 5.1 4.8 6.1

SUPPLIES TOTAL. .............. .cents 55.1 53.3 76.2

Facility repairs. ............. .cents 6.6 6.8 6.7
Equipment operation .............. cents 1.5 1.3 5.3

OTHER PRODUCTION COSTS TOTAL. ........ .cents 8.1 8.0 12.0

Travel. . . . . . . . ... .cents 1.6 1.3 3.3
Insurance . . . . . . . . . .cents 4.0 3.9 7.3
Telephone . . . . . . . . .cents 1.6 1.3 3.0
Electricity . . . . . . . . . cents 0.9 0.7 3.4
Taxes & Liscenses . . . . . . . .cents 1.3 1.2 5.2
Advertising . . . . . . . . cents 1.2 1.1 2.9
Rent-Land/buildings .... .......... cents 1.7 1.7 0.7
Other cash costs. .............. ..cents 11.7 12.0 8.1

ADMINISTRATIVE & OVERHEAD COSTS TOTAL .... .cents 24.1 23.3 33.7

TOTAL CASH COSTS. .............. .cents 144.3 137.7 225.9

Depreciation-machinery/equipment ........ cents 3.9 3.6 8.7
Depreciation-buildings/etc. . . . .. .cents 7.3 7.0 17.8
Supply inventory decrease .......... .cents 0.0 0.0 0.4
Interest on capital ............. .cents 19.8 17.1 59.3

TOTAL NON-CASH COSTS. ............ .cents 31.1 27.7 86.1

TOTAL ALL COSTS ........... ... .cents 175.3 165.3 312.0































39









Appendix Table 9--Costs per square foot of propagating & finishing space, 21 foliage nurseries in
Dade County, FLorida, 1987.

unit ALL Largest Smallest Your
Nurseries Third (7) Third (7) Nursery

Operator's salary .............. .cents 10.2 7.5 51.5
Other wages .................. cents 48.2 46.4 55.0

LABOR TOTAL .................. cents 58.4 53.8 106.4

Plants & seeds. ............... .cents 23.6 22.3 27.6
Containers. ................. .cents 6.5 6.1 11.5
Heating fuel. ................ .cents 1.3 1.3 1.7
Peat & soil ................. .cents 5.3 5.0 11.0
Fertilizers & Lime. ...............cents 4.4 4.3 8.5
Pesticides & chemicals. ............. cents 4.2 4.3 5.3
Shipping supplies ............... cents 5.9 5.8 6.1
Other production supplies ........... cents 5.2 4.9 6.3

SUPPLIES TOTAL. ............... .cents 56.6 53.9 78.0

Facility repairs. .............. .cents 6.8 6.8 6.8
Equipment operation ..............cents 1.6 1.3 5.5

OTHER PRODUCTION COSTS TOTAL. ........ .cents 8.4 8.1 12.3

Travel. . . . . . . . ... .cents 1.7 1.4 3.3
Insurance . . . . . . . .. .cents 4.1 3.9 7.4
Telephone . . . . . . . . . .cents 1.6 1.4 3.0
Electricity . . . . . . . . . cents 1.0 0.8 3.4
Taxes & Liscenses .............. .cents 1.3 1.2 5.3
Advertising . . . . . . . . cents 1.3 1.2 2.9
Rent-land/buildings ............ .cents 1.8 1.7 0.7
Other cash costs. .............. .cents' 12.0 12.1 8.3

ADMINISTRATIVE & OVERHEAD COSTS TOTAL ..... cents 24.8 23.6 34.5

TOTAL CASH COSTS. .............. .cents 148.1 139.4 231.2

Depreciation-machinery/equipment. .......cents 4.0 3.7 8.9
Depreciation-buildings/etc. . . . .. .cents 7.5 7.1 18.2
Supply inventory decrease .......... .cents 0.0 0.0 0.4
Interest on capital . . . . .... .cents 20.3 17.3 60.7

TOTAL NON-CASH COSTS. ............ .cents 31.9 28.0 88.1

TOTAL ALL COSTS ............... .cents 180.0 167.5 319.3

- - - - - - - - - - --... ===











Appendix Table 10--Costs per dollar's worth of production, 21 foliage nurseries in
Dade County, Florida, 1987.

unit All Largest Smallest Your
Nurseries Third (7) Third (7) Nursery


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


LABOR TOTAL . . . . . . . . .

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

SUPPLIES TOTAL . . . . . . . .

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

OTHER PRODUCTION COSTS TOTAL . . . .

Travel . . . . . . . . .
Insurance . . . . . . . . .
Telephone . . . . . . . .
Electricity . . . . . . . . .
Taxes & liscenses . . . . . . .
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 . . . .


.cents

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

.cents

.cents
.cents

.cents

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

.cents

.cents


6.2
29.2

35.4

14.3
3.9
0.8
3.2
2.7
2.6
3.6
3.1

34.3

4.1
0.9

5.1

1.0
2.5
1.0
0.6
0.8
0.8
1.1
7.3

15.0

89.8


. . . . .cents 2.4
. . . . .cents 4.6
. . . . .cents 0.0
. . . . .cents 12.3

. . . . .cents 19.3

. . . . .cents 109.1


4.8
29.8

34.6

14.3
3.9
0.9
3.2
2.7
2.7
3.8
3.1

34.7

4.4
0.8

5.2

0.9
2.5
0.9
0.5
0.8
0.7
1.1
7.8

15.2

89.6

2.3
4.5
0.0
11.1

18.0

107.6


24.9
26.6

51.4

13.3
5.6
0.8
5.3
4.1
2.6
2.9
3.0

37.7

3.3
2.6

5.9

1.6
3.6
1.5
1.7
2.5
1.4
0.4
4.0

16.7

111.7

4.3
8.8
0.2
29.3

42.6

154.3


________________________________________
________________________________________











Appendix Table 11--Costs per dollar of sales, 21 foliage nurseries in Dade County, Florida, 1987.


unit ALL Largest
Nurseries Third (7)
. . . . . . . . . . . . . . . . . . . . . . . . . . . .


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


LABOR TOTAL . . . .


.cents
.cents


. . . . .cents


Plants & seeds. . . . . . . .. .cents
Containers. . . . . . . . .. .cents
Heating fuel. . . . . . . . . .cents
Peat & soil .................. cents
Fertilizers & Lime. .... .. ....... cents
Pesticides & chemicals. . . . . . .cents
Shipping supplies . . . . . . .cents
Other production supplies . . . . . .cents

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

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

OTHER PRODUCTION COSTS TOTAL. . . . . .cents


Travel . . . . . . . . .
Insurance . . . . . . . . .
Telephone . . . . . . . . .
Electricity . . . . . . . . .
Taxes & liscenses . . . . . . .
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 . . . . . .


6.3
29.8

36.1

14.6
4.0
0.8
3.3
2.7
2.6
3.7
3.2

35.0

4.2
1.0

5.2


.cents 1.0
.cents 2.6
.cents 1.0
.cents 0.6
.cents 0.8
.cents 0.8
.cents 1.1
.cents 7.4

.cents 15.3

.cents 91.6


.cents
.cents
.cents
.cents

.cents


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


2.5
4.7
0.0
12.6

19.7

111.4


4.9
30.5

35.4

14.7
4.0
0.9
3.3
2.8
2.8
3.8
3.2

35.5

4.5
0.8

5.3

0.9
2.6
0.9
0.5
0.8
0.8
1.1
8.0

15.5

91.7

2.4
4.6
0.0
11.4

18.4

110.2


Smallest Your
Third (7) Nursery


22.7
24.2

46.9

12.1
5.1
0.8
4.8
3.7
2.3
2.7
2.8

34.4

3.0
2.4

5.4


1.5
3.3
1.3
1.5
2.3
1.3
0.3
3.6

15.2

101.9

3.9
8.0
0.2
26.7

38.8

140.7


==================================------
----------------------------------------












Appendix Table 12--Income summary, 21 foliage nurseries in Dade County, Florida, 1987.

.......................== ==== === ==--=- -=
unit ALL Largest Smallest Your
Nurseries Third (7) Third (7) Nursery
...................................................................................................... ..


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

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

F Deduct cash costs except operator's salary . .
G Deduct non-cash costs except interest . . .

H Total Deductions . . . . . . . .

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

K RETURN TO CAPITAL . . . . . . .
L Rate of Return to Capital . . . . . .


$ 1,040,954
$ 21,563
$ 634
$ 8,117

S 1,071,268

S (888,354)
S (74,463)

S (962,817)

$ 108,451
S (65,518)

$ 42,933
% 3.93


Appendix Table 13--Statement of financial position, 21 foliage nurseries in Dade County, Florida, 1987.


unit ALL Largest Smallest Your
Nurseries Third (7) Third (7) Nursery


CURRENT ASSETS- - - -
k Cash/checkbook balance
1 Accounts receivable..
: Plant inventory value.
SSupply inventory value


S
S
S
S


E Total CURRENT Assets . . . . . ... .


LONG TERM ASSETS- - -
Machinery & Equipment.
3 Buildings & Fixtures .
i Land . . . .


I Sub-total (original cost). . . .

J Less Accumulated Depreciation. . .

K Total LONG TERM Assets . . . .

L TOTAL ASSETS . . . . . .


37,863
201,860
398,587
8,991

647,301


. .. 189,594
... $ 425,549
. . $ 141,208

. . $ 756,350

. . 311,822

. .. 444,528

... 1,091,829


M Current Liabilities. . . . . . . ... $ 63,595
N Long Term Liabilities. . . . . . ... $ 288,566

0 Total LIABILITIES. . . . . . . .. . 352,160

P NET WORTH. . . . . . . . . ... 739,669

0 TOTAL LIABILITIES & NET WORTH . . . ... $ 1,091,829


88,589
554,789
764,127
18,946

1,426,451


478,045
1,059,801
309,694

1,847,540

761,111

1,086,429

2,512,880


168,154
648,958

817,111

1,695,769
==2,512880
2,512,880


13,442
10,160
101,081
3,584

128,268


32,457
80,030
64,071

176,559

51,441

125,119

253,387


6,002
78,647

84,649

168,738

253,387


2,650,626
62,419
2,539
12,534

2,728,118

(2,301,904)
(186,817)

(2,488,720)

239,397
(129,937)

109,460
4.36


113,783
(10,023)
0
3,640

107,400

(90,096)
(13,768)

(103,864)

3,536
(25,811)

(22,275)
-8.79


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