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Business analysis of container nurseries in Florida
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Permanent Link: http://ufdc.ufl.edu/UF00026136/00002
 Material Information
Title: Business analysis of container nurseries in Florida
Series Title: Economic information report
Portion of title: Container nurseries in Florida
Physical Description: v. : ; 28 cm.
Language: English
Creator: Perkins, George R
Almeter, Carolyn A
Dasse, Frank A ( Frank Arthur ), 1933-
Gunter, Dan L
Strain, J. Robert
University of Florida -- Food and Resource Economics Dept
Publisher: Food and Resource Economics Dept., Cooperative Extension Service, Institute of Food and Agricultural Sciences, University of Florida
Place of Publication: Gainesville Fla
Creation Date: 1974
Publication Date: 1975-
Frequency: annual
regular
 Subjects
Subjects / Keywords: Nurseries (Horticulture) -- Economic aspects -- Periodicals -- Florida   ( lcsh )
Potted plant industry -- Economic aspects -- Periodicals -- Florida   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
statistics   ( marcgt )
serial   ( sobekcm )
 Notes
Dates or Sequential Designation: 1973-
General Note: Title from cover.
 Record Information
Source Institution: University of Florida
Rights Management: All rights reserved by the source institution and holding location.
Resource Identifier: aleph - 000408267
oclc - 08153546
notis - ACF4735
System ID: UF00026136:00002

Table of Contents
    Front Cover
        Front Cover
    Abstract
        Abstract
    Acknowledgement
        Page i
    Table of Contents
        Page ii
        Page iii
        Page iv
    Main
        Page 1
        Page 2
        Page 3
        Page 4
        Page 5
    Tables
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
Full Text

lrank A.Dasse
Carolyn A. Almeter


Business Analysis


Econo


of Container


Nurseries in Florida, 1974


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


November 1975






















ABSTRACT

This report presents average costs and returns information for

15 wholesale ornamental container nurseries in Florida for the 1974

tax year. Nursery farm income increased less than 1% from 1973

while sales decreased by 20%. This decrease in plant sales was ac-

companied by a 13% decrease in costs and an average plant inventory

value increase of $27,360.

Key words: Ornamentals, container nurseries.












ACKNOWLEDGMENTS


Special appreciation is expressed to the container nurserymen who

participated in the program by making available data on their business

operations on a confidential basis. Thanks also are due for the time

they spent explaining when questions arose. Appreciation is expressed

to the county extension agents for their assistance during the data

gathering stage. It is sincerely hoped that these data will be useful

to all nurserymen--those who participated as well as those who did

not--when they appraise their business as well as when they must make

management decisions.













TABLE OF CONTENTS


Page


ACKNOWLEDGMENTS . . . .

LIST OF TABLES .. . . . .

LIST OF FIGURES . . . .

INTRODUCTION . . . .

DEFINITION OF TERMS . . ... .

OBSERVATIONS AND COMMENTARY . . .

DATA PRESENTATION . . . .


LIST OF TABLES


Table
1 Size of business, six large volume and nine smaller
volume, wholesale ornamental container nurseries
in Florida, 1974 . . . . .

2 Rates of production, six large volume and nine
smaller volume, wholesale ornamental container
nurseries in Florida, 1974 . . .

3 Labor efficiency, six large volume and nine
smaller volume, wholesale ornamental container
nurseries in Florida, 1974 . . .

4 Efficiency in use of capital, six large volume
and nine smaller volume, wholesale ornamental
container nurseries in Florida, 1974 . .

5 Efficiency in use of space, six large volume
and nine smaller volume, wholesale ornamental
container nurseries in Florida, 1974 . .


6 Comparison of certain cost and returns measures,
six large volume and nine smaller volume, whole-
sale ornamental container nurseries in Florida,
1974 . . . . . .


. . . ii

. . . .. iv

. . . 1

. . . 2


Page


. . 10







LIST OF TABLES--Continued
Table Page
7 Average dollar costs per nursery for various
categories of expense, six large volume and
nine smaller volume, wholesale ornamental
container nurseries in Florida, 1974 . .... . 11

8 Percent of total costs for various categories
of expense, six large volume and nine smaller
volume, wholesale ornamental container nurseries
in Florida, 1974 . . . . . 12

9 Average costs per square foot of production area,
six large volume and nine smaller volume, whole-
sale ornamental container nurseries in Florida,
1974 ....... . . . . 13

10 Average costs per square foot of plant sales
equivalent, six large volume and nine smaller
volume wholesale ornamental container nurseries
in Florida, 1974 . . .... . . 14

11 Average costs per dollar of sales with plant
inventory increase added to sales, six large
volume and nine smaller volume, wholesale
ornamental container nurseries in Florida, 1974. . 15

12 Average costs per dollar of sales without plant
inventory increase added to sales, six large
volume and nine smaller volume, wholesale orna-
mental container nurseries in Florida, 1974. ... . 16

13 Income summary, six large volume and nine smaller
volume, wholesale ornamental container nurseries
in Florida, 1974 . . . . . 17

14 Factors associated with level of profit,seven
high profit and eight lower profit, wholesale
ornamental container nurseries in Florida, 1974 . ... 18

15 Degree of association between certain factors
and level of profit, 15 wholesale ornamental
container nurseries in Florida, 1974 ... . . 19

16 Range of figures on profits and eight factors
associated with profits, wholesale ornamental
container nurseries in Florida, 1974 . . . 20

17 Comparison of business analysis factors for six
years for the same eleven wholesale ornamental
container nurseries in Florida, which furnished
data for 1969, 1970, 1971, 1972, 1973, and 1974. . ... 21


iii *












LIST OF FIGURES
Figure Page
1 The relationship of profit to total score on
the eight factors in Table 15. . . . .. .22












BUSINESS ANALYSIS OF CONTAINER NURSERIES IN FLORIDA: 1974


Frank A. Dasse and Carolyn Almeter

INTRODUCTION


This is another in the line of business analysis reports which was

started by Dr. E. W. "Ned" Cake a number of years ago. The purpose in

the beginning was and still is threefold: (1) to furnish various

economic or statistical measures that cooperating nurserymen may use

in judging their own operations and in comparing with their peers; (2)

to supply data to all nurserymen in Florida to help them make meaningful

decisions in their own operations; and (3) to provide to Extension

personnel and other professionals information which they can use in farm

management decisions involving nurserymen in their area.

This is by no means a statistical sample of container nurseries. The

fifteen nurserymen who contributed to this report joined the program a

number of years ago and have elected to continue. The data presented

refer to the 1974 tax year, which may not conform in all cases to the

1974 calendar year.

In order to assemble the data which are presented as averages later

in this report, a minimum number of figures were sought from the contributing

nurserymen. From these data the tables were constructed. Each table has


FRANK A. DASSE was an assistant research scientist in the Food and
Resource Economics Department. CAROLYN ALMETER is a statistical aide
in the Food and Resource Economics Department.







an analysis of an important facet of the container nursery business first

shown as the "one best measure" then followed by a number of "other useful

indicators." -The tables also include and depict the averages of "large"

and "smaller" nurseries, divided at $200,000 of plant sales for the year.


DEFINITION OF TERMS


Most of the terms used in the tables are self-explanatory. They have

been used similarly in past reports. For those who are not familiar

with the terminology a number of definitions are presented.

Value of own plants sold.--This represents the total plant sales

minus the cost of plants purchased for immediate resale. Plants pur-

chased for growing-on are not deducted.

Square foot equivalent of own plants sold.--Each piece of material

sold is credited with taking up a specific amount of land space expressed

in square feet.

Percent turnover of capital annually.--A ratio derived by dividing

the value of own plants sold by the total capital employed in the enter-

prise.

Percent of production area turnover annually.--The square foot

equivalent of own plants sold divided by the total production area of the

nursery.

Labor income.--The residual when total costs less operator's salary

are deducted from total gains.

Nursery "farm income".--Labor income plus the calculated desired

return on investment presented in non-cash costs.

Net return.--Labor income less operators salary or total gain less

total costs.







Return to capital,--Nursery farm income less operators salary.

Percent return to capital.--Return to capital divided by total owned

capital.

OBSERVATIONS AND COMMENTARY


The fifteen participating nurseries in the 1974 business analysis

program had an average total gain, which represents both sales and

inventory increases, of $219,686. The return to owned capital was 17.4%.

Both these figures are quite respectable.

The large nurseries did not generate as high a farm income ratio

(26%) as smaller nurseries (32%). Generally the feeling has been that

large nurseries are more efficient and profitable than smaller nurseries.

In examining the data a large part of the total gain by smaller nurseries

was an increase in the value of inventory of plant material. If that

increase in plant inventory is by decision then the smaller nurseries

indeed had a good year. If however, the buildup of inventory is because

sales are slowing down, then the numbers considerably overstate the

conditions of the smaller nurserymen.

The large nurseries had an average rate of production 56% higher

than smaller nurseries. Even when inventory increases were taken into

account the larger nurseries were 17% higher.
The large nurseries had sales per employee 54% higher than smaller

nurseries although the square feet in production per employee were almost

identical.

The large nurseries had a capital turnover 77% higher than smaller

nurseries. Also the capital intensity in relation to land and labor

was lower for large nurseries. These data indicate that the large







nurseries do, because of their size, enjoy some economies.

The value per square foot of plant material sold were almost identical

for large and small nurseries. This may indicate that there is considerable

price leadership in this industry. Costs per square foot of plant sales

between large and smaller nurseries depend upon whether inventory increases

are included in sales. If inventory increases are allowed then the cost

advantage is clearly in favor of the smaller nurseries. If inventory

increases are not considered cost advantage goes to the large nurseries

by a large margin. As mentioned earlier the reason for inventory build

up is crucial for the smaller nurseryman in determining his outlook.

Eleven nurseries have participated in the business analysis program

continuously since 1969. The results for 1974 indicate that nursery "farm

income" dropped somewhat compared to 1973. The value of own plant material

sold went up 18% from 1973 to 1974; however, the square foot equivalent

of own plant material sold dropped almost 27%. This latter indicates

a price inflation of about 61% or a switching to material that yields a

higher price per area used.

The principal increase in costs between 1973 and 1974 was in "plants

and seeds to grow on" and "cans and other growing containers." These

two categories went up almost 5 cents per dollar of sales plus plant

inventory change.

In general it does not appear that these eleven nurseries were

seriously affected by the general economic slow down that has affected

the U.S. economy. A principal determinant in the demand for woody

ornamental plant materials was thought to be housing starts. The pre-

cipitous decline in housing starts throughout 1974 does not seem to

be reflected, at least so far, in the demand for container plant







material. If demand for plant material has become stronger, then when

the housing industry begins its comeback further gains should be.made by

the container nurseries. If however, there is a lag in the market

response to the decline in housing starts, there may yet be economic

hardship on the horizon for these nurserymen.


DATA PRESENTATION


The data in Tables 1 through 13 relate to size of business, rates

of production, labor efficiency, capital efficiency, space efficiency,

costs and returns, income and other factors for nurseries classified

by size or volume of sales. Various analyses relating to profit are

shown in Tables 14, 15 and 16.

Table 17 denotes profit indicators for eleven nurseries which have

been included in the study since 1969. Most nurseries cooperating in

the program showed improvement in earnings; a few reported losses

while still others progressed a great deal. It is not claimed that

the improvements made are due to their participation in this business

analysis program. The study does, however, show each cooperating nursery

how it compares with respect to each factor in the analysis.

In Figure 1 each nursery is ranked by nursery farm-income and a

summary of the factors associated with profit. As the total score

goes up, the total profit goes down. The upward sloping line indicates

that those nurseries which score poorly on certain management factors

also rank low on profits.







Table l.--Size of business, six large volumeaand nine
wholesale ornamental container nurseries in


smaller volume,
Florida, 1974


Average Average Average Your
Item all 15 6 large 9 smaller ry
nurseries nurseries nurseries rsery


One best measure
Value of own plants sold

Other useful indicators
Value of own plants sold adj.
for plant inventory
Sq. ft. equiv. own plants sold
Sq. ft. equiv. own plants sold
adj. for plant inven. change
Average sq. ft. of own plants
in production
Average acres equiv. of own
plants in production
Average number of employees
Capital owned
Growing plants
Land
Machinery & equipment
Bldgs., fences, well, etc.
Supplies
Total owned capital

Capital managed
Growing plants
Land
Machinery & equipment
Bldgs., fences, wells, etc.
Supplies
Total managed capital


$190,261 $332,859 $ 95,195 $


217,621
112,053

128,167


346,929
196,308

204,606


131,415
55,883

77,145


$


288,012 432,024 192,004


6.61
10.61


$178,015
12,326
24,232
25,994
8,086
$248,653


$178,015
23,993
25,566
26,532
8,086
$262,192


9.92
15.99


$235,234
13,725
46,110
47,706
10,903
$353,667


$235,234
25,391
46,110
48,478
10,903
$366,117


4.41
7.03

$139,868
11,393
9,647
11,519
6,209
$178,637


$139,868
23,060
11,869
11,902
6,209
$192,908


$


$






$


aNurseries with annual sales of own plants in excess of $200,000.






Table 2.--Rates of production, six large
wholesale ornamental container


volumeand nine smaller volume,
nurseries in Florida, 1974


Average Average Average Your
Item all 15 6 large 9 smaller
nurseries nurseries nurseries nursery

One best measure
Sq. ft. equivalent of own
plants sold per acre in prod. 16,947 19,793 12,678

Other useful indicators
Value of own plants sold
per acre in production $ 28,776 $ 33,561 $ 21,597 $
Value of own plants sold
adjusted for plant inven-
torychange per acre in
production $ 32,914 $ 34, 980 $ 29,814 $


Table 3.--Labor efficiency, six large volumeaand nine smaller volume,
wholesale ornamental container nurseries in Florida, 1974

Average Average Average Your
Item all 15 6 large 9 smaller ur
nurseries nurseries nurseries

One best measure
Value of own plants
sold per employee $ 17,932 $ 20,817 $ 13,561 $

Other useful indicators
Value own plants sold
adjusted for plant
inventory change per
employee $ 20,511 $ 21,697 $ 18,720 _
Sq. ft. equivalent of own
plants sold per employee 10,561 12,277 7,961
Sq. ft. equivalent of own
plants sold adjusted for
plant inventory change per
employee 12,080 12,796 10,989
Average sq. ft. in pro-
duction per employee 27,145 27,018 27,351


aNurseries with annual sales of own plants in excess of $200,000.







Table 4.--Efficiency in use of capital, six large volume and nine smaller
volume, wholesale ornamental container nurseries in Florida,
1974

Average Average Average Your
Item all 15 6 large 9 smaller
nurseries nurseries nurseries


One best measure
Percent turnover of owned
capital annually

Other useful indicators
Percent turnover of managed
capital annually

Capital owned
per employee
per acre

Capital managed
per employee
per acre

Capital managed per employee
in
plants
land
machinery & equipment

Capital managed per acre in
plants
land
machinery & equipment

Percent of capital managed in
plants
land
machinery & equipment
bldgs., wells, fences, etc.
supplies

Total


76.52%


72.57%


$23,436
37,607


24,712
39,655



$16,778
2,261
2,410


$26,924
3,629
3,867


67.89%
9.15
9.75
10.12
3.08

100.00%


94.11%


90.92%


$22,119
35,661


22,897
36,915



$14,711
1,588
2,884


$23,718
2,560
4,649


64.25%
6.94
12.59
13.24
2.98


53.29%


49.35%


$25,447 $
40,527


27,480 $
43,765


$19,924
3,285
1,691


$31,732
5,232
2,693


72.51%
11.95
6.15
6.17
3.22


$




$


100.00% 100.00%


aNurseries with annual sales of own plants exceeding $200,000.







Table 5.--Efficiency in use of space, six large volume and nine smaller
volume, wholesale ornamental container nurseries in Florida, 1974

Average Average Average Your
Item all 15 6 large 9 smaller
nurseries nurseries nurseries rsery

One best measure
Percent of production area
(or plant) turnover annually 38.91% 45.44% 29.11% %
Other useful indicators
Sq. ft. equivalent of own
plants sold per acre in
production 16,947 19,793 12,678
Sq. ft. equiv. of own plants
sold adjusted for plant inven-
tory increase per acre in pro-
duction 19,384 20,630 17,502
Average value of plant inven-
tory per acre in production 26,924 23,718 31,732 $


aNurseries with annual sales of own plants exceeding $200,000.








Table 6.--Comparison of certain cost and returns measures, six large volume
and nine smaller volume, wholesale ornamental container nurseries
in Florida, 1974

Average Average Average Your
Item all 15 6 large 9 smaller ur
nurseries nurseries nurseries

- - -Cents- - - -
Returns
Value of own plants sold per
sq. ft. of plant sales equi-
valent 169.80 169.56 170.35

Costs
Total costs per sq. ft. of
plants sales equivalent 175.21 162.86. 204.12

Difference between
Value own plants sold and
costs per sq. ft. of plant
equivalent -5.41 6.70 -33.77

Price goal
Prices per sq. ft. of plant
sales equivalent which would
have been required to yield
a 15% return on investment
(not including plant inven-
tory increase as part of
return) 190.74 175.48 226.50

aNurseries with annual sales of own plants exceeding $200,000.








Table 7.--Average dollar costs per nursery for various categories of
expense, six large volume and nine smaller volume, wholesale
ornamental container nurseries in Florida, 1974

Average Average Average Your
Item all 15 6 large 9 smaller r
nurseries nurseries nurseries rsery
- - Dollars - -


Cash costs
Operator's salary 18,835
Other wages & salaries 56,122
Plants & seeds to grow on 14,554
Cans & other growing con-
tainers 19,889
Peat, soil, shavings, etc. 6,320
Fertilizer and lime 3,814
Pesticides & other chemicals 1,678
Other prod. supplies 5,177
Repairs & maintenance 4,204
Equipment operating costs 3,918
Travel & entertainment 1,040
Insurance 4,733
Telephone 1,481
Electricity 1,696
Taxes, licenses & bonds 5,648
Advertising 1,403
Rent-land and/or buildings 3,751
Other cash expenses 14,096
Total cash costs 168,358

Non-cash costs
Depreciation machinery & equip. 4,790
Depreciation buildings etc. 3,288
Inventory decrease on supplies 0
Interest on capital @ 8% 19,892
Total non-cash costs 27,970

Total all costs 196,328


34,099
92,842
28,750

33,777
9,225
6,041
2,926
7,215
6,882
7,543
1,742
9,313
2,034
2,095
10,148
1,688
3,080
19,591
278,989


7,264
5,169
0
28,294
40,727

319,716


8,569
31,642
5,090

10,630
4,383
2,329
845
3,817
2,418
1,502
572
1,680
1,112
1,429
2,648
1,213
4,199
10,433
94,604

3,034
2,030
0
14,291
19,466

114,069


aNurseries with annual sales of own


plants exceeding $200,000.








Table 8.--Percent of total costs for various categories of expense, six
large volumeaand nine smaller volume, wholesale ornamental
container nurseries in Florida, 1974


Average Average Average Your
Item all 15 6 large 9 smaller
nurseries nurseries nurseries nursery

- - Percent - -

Cash costs
Operator's salary 9.59 10.67 7.59
Other wages & salaries 28.59 29.04 27.74
Plants & seeds to grow on 7.41 8.99 4.46
Cans & other growing containers .10.13 10.56 9.32
Peat, soil, shavings, etc. 3.22 2.89 3.84
Fertilizer and lime 1.94 1.89 2.04
Pesticides & other chemicals 0.85 0.92 0.74
Other prod. supplies 2.64 2.26 3.35
Repairs & maintenance 2.14 2.15 2.12
Equipment operating costs 2.00 2.36 1.32
Travel & entertainment 0.53 0.54 0.50
Insurance 2.41 2.91 1.47
Telephone 0.75 0.64 0.97
Electricity 0.86 0.66 1.25
Taxes, licenses & bonds 2.88 3.17 2.32
Advertising 0.71 0.53 1.06
Rent-land and/or buildings 1.91 0.96 3.68
Other cash expenses 7.18 6.13 9.15
Total cash costs 85.75 87.26 82.94

Non-cash costs
Depreciation machinery & equip. 2.44 2.27 2.75
Depreciation buildings etc. 1.67 1.62 1.78
Inventory decrease on supplies 0 0 0
Interest on capital @ 8% 10.13 8.85 12.53
Total non-cash costs 14.25 12.74 17.06

Total all costs 100.00 100.00 100.00

aNurseries with annual sales of own plants exceeding $200,000.







Table 9.--Average costs per square foot of production area, six large
volume and nine smaller volume, wholesale ornamental container
nurseries in Florida, 1974

Average Average Average Your
Item all 15 6 large 9 smaller es
nurseries nurseries nurseries
- - Cents - - -
Cash costs
Operator's salary 6.54 7.89 4.51
Other wages & salaries 19.49 21.49 16.48
Plants & seeds to grow on 5.05 6.65 2.65
Cans & other growing containers 6.91 7.82 5.54
Peat, soil, shavings, etc. 2.19 2.14 2.28
Fertilizer and lime 1.32 1.40 1.21
Pesticides & other chemicals 0.58 0.68 0.44
Other prod. supplies 1.80 1.67 1.99
Repairs & maintenance 1.46 1.59 1.26
Equipment operating costs 1.36 1.75 0.78
Travel & entertainment 0.36 0.40 0.30
Insurance 1.64 2.16 0.88
Telephone 0.51 0.47 0.58
Electricity 0.59 0.48 0.74
Taxes, licenses & bonds 1.96 2.35 1.38
Advertising 0.49 0.39 0.63
Rent-land and/or buildings 1.30 0.71 2.19
Other cash expenses 4.89 4.53 5.43
Total cash costs 58.46 64.58 49.27
Non-cash costs
Depreciation machinery & equip. 1.66 1.68 1.64
Depreciation buildings etc. 1.14 1.20 1.06
Inventory decrease on supplies 0 0 0
Interest on capital @ 8% 6.91 6.55 7.44
Total non-cash costs 9.71 9.43 10.14

Total all costs 68.17 74.00 59.41

aNurseries with annual sales of own plants exceeding $200,000.





14

Table 10.--Average costs per square foot of plant sales equivalent,a six large
volumeu and nine smaller volume wholesale ornamental container
nurseries in Florida, 1974


Average costs
per sq. ft. plant sales equivalent
Item
All 15 6 large 9 smaller Your
nurseries nurseries nurseries nursery

- - Cents - - -

Cash costs
Operator's salary 14.70 16.67 11.22
Other wages & salaries 43.79 45.38 41.02
Plants & seeds to grow on 11.36 14.05 6.60
Cans & other growing containers 15.52 16.51 13.78
Peat, soil, shavings, etc. 4.93 4.51 5.68
Fertilizer and lime 2.98 2.95 3.02
Pesticides & other chemicals 1.31 1.43 1.10
Other prod. supplies 4.04 3.53 4.95
Repairs & maintenance 3.28 3.36 3.13
Equipment operating costs 3.06 3.69 1.95
Travel & entertainment 0.81 0.85 0.74
Insurance 3.69 4.55 2.18
Telephone 1.16 0.99 1.44
Electricity 1.32 1.02 1.85
Taxes, licenses & bonds 4.41 4.96 3.43
Advertising 1.09 0.82 1.57
Rent-land and/or buildings 2.93 1.51 5.44
Other cash expenses 11.00 9.57 13.52
Total cash cost 131.36 136.35 122.63

Non-cash costs
Depreciation machinery & equip. 3.74 3.55 4.07
Depreciation buildings etc. 2.57 2.53 2.64
Inventory decrease on supplies 0 0 0
Interest on capital @ 8% 15.52 13.83 18.52
Total non-cash costs 21.82 19.91 25.23

Total all costs 153.18 156.26 147.86

aIn this case, the square foot equivalent of plant sales is shown as
item 4 in Table 1. It is not just the portion represented by the plants
actually sold during the year, but to that has been added the square feet
represented by the plant inventory increase during the year.
bNurseries with annual sales of own plants exceeding $200,000.







Table ll.--Average costs per dollar of sales with plant inventory increase
added to sales, six large volume and nine smaller volume, whole-
sale ornamental container nurseries in Florida, 1974

Average costs per $ sales with plant
inventory increase added to sales
Item
All 15 6 large 9 smaller Your
nurseries nurseries nurseries nursery
- - Cents - - -

Cash costs
Operator's salary 8.66 9.83 6.59
Other wages & salaries 25.79 26.76 24.08
Plants & seeds to grow on 6.69 8.29 3.87
Cans & other growing containers 9.14 9.74 8.09
Peat, soil, shavings, etc. 2.90 2.66 3.34
Fertilizer'and lime 1.75 1.74 1.77
Pesticides & other chemicals 0.77 0.84 0.64
Other prod. supplies 2.38 2.08 2.90
Repairs & maintenance 1.93 1.98 1.84
Equipment operating costs 1.80 2.17 1.14
Travel & entertainment 0.48 0.50 0.44
Insurance 2.18 2.68 1.28
Telephone 0.68 0.59 0.85
Electricity 0.78 0.60 1.09
Taxes, licenses & bonds 2.60 2.92 2.01
Advertising 0.64 0.49 0.92
Rent-land and/or buildings 1.72 0.89 3.19
Other cash expenses 6.48 5.65 7.94
Total cash costs 77.36 80.42 71.99

Non cash costs
Depreciation machinery & equip. 2.20 2.09 2.39
Depreciation buildings etc. 1.51 1.49 1.55
Inventory decrease on supplies 0 0 0
Interest on capital @ 8 % 9.14 8.16 10.87
Total non-cash costs 12.85 11.74 14.81

Total all costs 90.22 92.16 86.80

aNurseries with annual sales of own exceeding $200,000.







Table 12.--Average costs per dollar of sales without plant inventory increase
added to sales, six large volume and nine smaller volume, whole-
sale ornamental container nurseries in Florida, 1974

Average costs per $ sales without plant
inventory increase added to sales
Item
All 15 6 large 9 smaller Your
nurseries nurseries nurseries nursery

- - Cents - - -
Cash costs
Operator's salary 9.90 10.24 9.10
Other wages & salaries 29.50 27.89 33.24
Plants & seeds to grow on 7.65 8.64 5.35
Cans & other growing containers '10.45 10.15 11.17
Peat, soil, shavings, etc. 3.32 2.77 4.60
Fertilizer and lime 2.00 1.81 2.45
Pesticides & other chemicals 0.88 0.88 0.89
Other prod.. supplies 2.72 2.17 4.01
Repairs & maintenance 2.21 2.07 2.54
Equipment operating costs 2.06 2.27 1.58
Travel & entertainment 0.55 0.52 0.60
Insurance 2.49 2.80 1.77
Telephone 0.78 0.61 1.17
Electricity 0.89 0.63 1.50
Taxes, licenses & bonds 2.97 3.05 2.78
Advertising 0.74 0.51 1.27
Rent-land and/or buildings 1.97 0.93 4.41
Other cash expenses 7.41 5.89 10.96
Total cash costs 88.49 83.82 99.38

Non-cash costs
Depreciation machinery & equip. 2.52 2.18 3.30
Depreciation buildings 1.73 1.55 2.14
Inventory decrease on supplies 0 0 0
Interest on capital @ 8% 10.46 8.50 15.01
Total non-cash costs 14.70 12.24 20.45
Total all costs 103.19 96.05 119.83

aNurseries with annual sales of own plants exceeding $200,000.








Table 13.--Income summary, six large volume and nine smaller volume,
wholesale ornamental container nurseries in Florida, 1974

Average Average Average Your
Item all 15 6 large 9 smaller nurser
nurseries nurseries nurseries

Value of production & other gain
Value of own plants sold 190,261 332,859 95,195 $
Inventory change own plants 27,360 14,070 36,220
Inventory increase for supplies 873 175 1,338
Miscellaneous cash income 1,192 914 1,378
Total gain 219,686 348,018 134,131
Cash costs less operator's sal. 149,523 244,891 85,944 $
Non-cash costs 27,970 40,727 19,466
Total gross costs 177,493 285,617 105,410 $
Labor income 42,193 62,400 28,721
Interest on investment 19,892 28,294 14,291
Nursery "farm income" 62,085 90,694 43,012
Operator's salary 18,835 34,099 8,659
Net return 23,358 28,301 20,062
Return to capital 43,250 56,596 34,353
Percent return to capital 17.39% 16.00% 19.23% %
Cents per square foot of production area
Labor income 15 14 15
Nursery "farm income" 22 21 22
Net return 8 7 10
Return to capital 15 13 18
Cents per square foot of plant sales equivalent
Labor income 33 30 37
Nursery "farm income" 48 44 56
Net return 18 14 26
Return to capital 34 28 45

aNurseries with annual sales of own plants exceeding $200,000.

In this case, plant sales equivalent is item 4 shown in Table 1.







Table 14.--Factors associated with level of profit seven high
eight lower profit, wholesale ornamental container
in Florida, 1974


profit, and
nurseries


7 high 8 lower Your
Factor profit profit
nurseries nurseries rsery


Profit
Nursery farm income

1. Size of business
Value of own plants sold

2. Level of cost
Cost per $ of sales and plant
inventory value increase

3. Labor efficiency
Value of own plants sold per
employee

4. Sales price level
Difference between sales value
and costs per sq. ft. of plant
sales equivalent


5. Sales & inventory gain
Gain in sales & plant inventory
value from previous year (item
2 in table 1 compared to same
item the previous year)

6. Production rate
Sq. ft. equivalent own plants
sold per acre in production

7. Capital use efficiency
Percent of capital turnover

8. Space use efficiency
Percent plant turnover


$ 123,003


$ 261,657


79.864


$ 23,127


-1.664


$ 124,646


24,999


90.32%


57.40%


$ 8,782

$127,789


169.754


$ 14,019


$

$


$


-29.394 4


$-10,073


$


16,253

63.91%


37.33%








Table 15.--Degree of association between certain factors and level of
profit, 15 wholesale ornamental container nurseries in Florida,
1974

Number and percent of the Rank of your
Factor 7 highest profit nurseries nursery
which were in the best on each
7 on each factor factor

Number Percent

Profit
Nursery farm income 7 100
start adding here

1. Size of business
Value of own plants sold 5 71

2. Level of cost
Cost per $ of sales and
plant inventory value
increase 5 71

3. Labor efficiency
Value of own plants
sold per employee 5 71

4. Sales price level
Difference between sales
value and costs per sq. ft.
of plant sales equivalent 4 57

5. Sales & inventory gain
Gain in sales & plant
inventory value from
previous year 5 71

6. Production rate
Sq. ft. equivalent own
plants sold per acre in
production 4 57

7. Capital use efficiency
Percent of capital turnover 4 57

8. Space use efficiency
Percent of plant turnover 4 57


Total score for your nursery on factors 1 through 8


-~--~I I--~








Table 16.--Range of figures on profits and eight factors associated with
profits, wholesale ornamental container nurseries in Florida,
1974

Average figures for the 3 best
and the 3 poorest nurseries
Factor on each factor Your
Nursery
Average for Average for
3 best 3 poorest


Profit
Nursery farm income

1. Size of business
Value of own plants
sold

2. Level of cost
Cost per $ of sales and
plant inven. value
increase

3. Labor efficiency
Value of own plants
sold per employee

4. Sales price level
Difference between sales
value and costs per sq.
ft. of plant sales equiv.

5. Sales & inventory gain
Gain in sales & plant
inven. value from pre-
vious year

6. Production rate
Sq. ft. equivalent own
plants sold per acre
in production

7. Capital use efficiency
% of capital turnover

8. Space use efficiency
% plant turnover


$ 183,828


$ 403,429


63.674


$ 29,894



26.754


$ 243,603




$ 40,224


131.46%


92.34%


$ 21,105



$ 42,643


295.674


$ 8,685



-66.57


$ 67,054



$ 9,516


37.37%


21.84%


$


$


$


$


--






Table 17.--Comparison of business analysis factors for six years for the same eleven wholesale ornamental
container nurseries in Florida, which furnished data for 1969, 1970, 1971, 1972, 1973, and 1974


Average for the same eleven nurseries in

1969 1970 1971 1972 1973 1974


Profit
Nursery farm income
Percent return to capital
1. Size of business
Value of own plants
2. Level of cost
Cost per $ sales and plant
inventory value increase
3. Labor efficiency
Value of own plants sold
per employee
4. Sales price level
Difference between sales value
and costs per sq. ft. of plant
sales equivalent
5. Sales & inventory gain
Gain in sales & plant inventory
value from previous year
6. Production rate
Sq. ft. equivalent own plants
sold per acre in production
7. Capital use efficiency
Percent of capital turnover
8. Space use efficiency
Percent plant turnover


$ 28,629 $ 31,356
17.59% 16.82%


$ 27,583 $ 45,114 $ 54,328 $ 43,243
11.01% 19.72% 19.22% 11.72%


$ 79,401 $ 85,708 $ 95,846 $119,467 $154,346 $182,069


87


$ 12,745 $ 12,697 $ 12,762 $ 14,138 $ 17,111 $ 19,125


3.70t


0.544


-3.85


1.674


-1.09t


$ 16,741 $ 10,140 $ 7,931 $ 31,941 $ 32,202 $ 11,576


20,573

72.13%


22,277

69.16%


19,761

69.63%


24,463

73.01%


23,659

79.80%


47.23% 51.14% 45.36%


89t


97t


2.484


16,983

89.20%


56.16% 54.31% 38.99%






































S, I I ,I I

0 1 2 3 4 5
High


Figure l.--The relationship of profit


6 7 8 9 10
Rank in level of profit


to total score on the eight


I I I

11 12 13



factors in Table 15.


I
15
Low


M