• TABLE OF CONTENTS
HIDE
 Copyright
 Title Page
 Title Page
 Abstract
 Table of Contents
 List of Figures
 List of appendix data tables
 Introduction
 Procedure
 Data and results
 Concluding comments
 Appendix






Group Title: Economic information report - Food & Resource Economics Department - 264
Title: Business analysis of flowering plant nurseries in Florida, 1986, 1987, 1988
CITATION PAGE IMAGE ZOOMABLE PAGE TEXT
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00027376/00001
 Material Information
Title: Business analysis of flowering plant nurseries in Florida, 1986, 1987, 1988
Series Title: Economic information report
Alternate Title: Flowering plant nurseries in Florida
Physical Description: vi, 36 p. : ill. ; 28 cm.
Language: English
Creator: Strain, J. Robert
Hodges, Alan W ( Alan Wade ), 1959-
University of Florida -- Food and Resource Economics Dept
Publisher: Food & Resource Dept., University of Florida
Place of Publication: Gainesville Fla
Publication Date: 1989
 Subjects
Subject: Nurseries (Horticulture) -- Economic aspects -- Florida   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
non-fiction   ( marcgt )
 Notes
Statement of Responsibility: J. Robert Strain and Alan Hodges.
General Note: "November 1989."
Funding: Florida Historical Agriculture and Rural Life
 Record Information
Bibliographic ID: UF00027376
Volume ID: VID00001
Source Institution: Marston Science Library, George A. Smathers Libraries, University of Florida
Holding Location: Florida Agricultural Experiment Station, Florida Cooperative Extension Service, Florida Department of Agriculture and Consumer Services, and the Engineering and Industrial Experiment Station; Institute for Food and Agricultural Services (IFAS), University of Florida
Rights Management: All rights reserved, Board of Trustees of the University of Florida
Resource Identifier: aleph - 001478325
oclc - 20975150
notis - AGZ0255

Table of Contents
    Copyright
        Copyright
    Title Page
        Title Page 1
        Title Page 2
    Title Page
        Page i
    Abstract
        Page ii
    Table of Contents
        Page iii
        Page iv
    List of Figures
        Page v
    List of appendix data tables
        Page vi
    Introduction
        Page 1
    Procedure
        Page 1
    Data and results
        Page 2
        Size of business
            Page 2
            Sales and total value of production
                Page 2
                Annual sales
                    Page 3
                Monthly sales
                    Page 3
            Land, labor and capital
                Page 4
                Land: bed and bench space
                    Page 4
                Labor: full-time equivalent persons
                    Page 4
                Capital: owned and managed
                    Page 4
                    Page 5
        Productivity indicators
            Page 6
            Land use
                Page 7
            Labor use
                Page 7
            Capital use
                Page 8
                Capital turnover
                    Page 8
                Capital managed per person
                    Page 8
                Capital managed per acre
                    Page 8
                Distribution of managed capital
                    Page 11
                    Page 9
                    Page 10
        Costs of production
            Page 11
            Costs by expense category
                Page 11
                Salaries and wages
                    Page 11
                Other production supplies
                    Page 11
                Administrative and overheard
                    Page 11
                Total cash costs
                    Page 11
                Non-cash costs
                    Page 11
                Costs as a percent of the total cost
                    Page 12
            Costs as a percent of the total cost
                Page 12
                Salaries and wages
                    Page 12
                Production supplies
                    Page 12
                Other production costs
                    Page 12
                Administrative and overhead
                    Page 12
                Total cash costs
                    Page 12
        Cost efficiency
            Page 13
            Cost per square foot of bed and bench space
                Page 13
            Cost per square foot of propagating and finishing space
                Page 13
                Page 14
            Cost per dollar's worth of production
                Page 15
            Cost per dollar's worth of sales
                Page 15
        Income summary
            Page 16
            Total gain
                Page 16
            Cost deductions and net nursery income
                Page 16
            Return on capital
                Page 17
        Statement of financial position
            Page 18
            Assets
                Page 18
                Cash on hand
                    Page 18
                Accounts receivable
                    Page 18
                Inventory values
                    Page 19
                Total current assets
                    Page 19
                Long term assets
                    Page 19
                Total assets
                    Page 19
            Liabilities
                Page 19
                Current liabilites
                    Page 19
                Long term liabilities
                    Page 20
                Total liabilities
                    Page 20
            Net worth
                Page 20
        Total profitability model
            Page 20
            Margin management
                Page 20
            Asset management
                Page 20
            Leverage management
                Page 20
    Concluding comments
        Page 20
        Page 21
        Page 22
    Appendix
        Page 23
        Definitions
            Page 24
        Making your own calculations
            Page 24
            Page 25
        Appendix tables
            Page 26
            Page 27
            Page 28
            Page 29
            Page 30
            Page 31
            Page 32
            Page 33
            Page 34
            Page 35
            Page 36
Full Text





HISTORIC NOTE


The publications in this collection do
not reflect current scientific knowledge
or recommendations. These texts
represent the historic publishing
record of the Institute for Food and
Agricultural Sciences and should be
used only to trace the historic work of
the Institute and its staff. Current IFAS
research may be found on the
Electronic Data Information Source
(EDIS)

site maintained by the Florida
Cooperative Extension Service.






Copyright 2005, Board of Trustees, University
of Florida









J. F',:bert Strain
Alan W. Hodges


Economic Information
Report 264


Business Analysis of Flowering Plant
Nurseries in Florida, 1986, 1987, 1988


Central Science
Library


InM i I lQan


University of Florida


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


November 1989


ii
i
j.
i.













BUSINESS ANALYSIS OF FLOWERING PLANT NURSERIES IN FLORIDA,
1986, 1987, 1988


J. Robert Strain and Alan Hodges






Food & Resource Economics Department


University of Florida


Gainesville




November 1989


The Institute of Food and Agricultural Sciences is an Equal Opportunity/Affirmative Action Employer authorized to provide research, educa-
tional information and other services only to individuals and institutions that function without regard to race, color, sex, or national origin.
Florida Cooperative Extension Service / Institute of Food and Agricultural Sciences / University of Florida / John T. Woeste, Dean



















. ...... ... ...::.'.. .. ... ,: ..



Flowerin lant i urseres


Floridal Nursery2 Business rAnalysis I Series


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Flowering Plants


ABSTRACT


Average sales, costs, returns, and efficiency indicators are presented for samples of wholesale flowering
plant nurseries in Florida during the tax years of 1986, 1987, 1988. Indicators of business performance
generally rated highest in 1988 with average returns on capital investment of 15.4 percent, and lowest for 1987
with returns of 13.5 percent. In 1988, capital investment including plant inventory, land, equipment, buildings,
supplies, and accounts receivable amounted to $441,307. Plant sales averaged $725,242. Value of plant
inventory increased during the year by $6,074. After adjustments were made for changes in inventories and
miscellaneous income, total gain for the year was $739,716. Total costs of production, including cash expenses
and non-cash allowances for depreciation, but excluding any returns to the operator, averaged $641,233. Net
nursery income averaged $98,483. Average returns (to owner-operator and capital) per square foot of growing
area were $.85. Comparable information is presented also for the 1986 and 1987 sample averages.

KEY WORDS: Flowering plant nursery business analysis, income, costs, investment, efficiency measures,
Florida.



ACKNOWLEDGEMENTS

This report was made possible by the cooperating flowering plant nursery operators who made available
their production and accounting records on a confidential basis for analysis and averaging. Assistance was
provided by University of Florida Extension Ornamental Horticulture Agents Bruce Barmby, Terry DelValle,
DeArmand Hull, and Roger Newton. Acknowledgement and appreciation of the help received, however, does
not alter the fact that errors in the analyses or in the interpretation of the information presented herein are
the sole responsibility of the authors.








Flowering Plants iii


TABLE OF CONTENTS


Page
ABSTRACT .............................................................. ii
ACENOWLEDGEMENTS ....................................................ii
LIST OF FIGU RES .......................................................... v
LIST OF TABLES ......................................................... v
LIST OF AE TABLES v
LIST OF APPENDIX TABLES ................................................ vi

INTRODUCTION ......................................................... 1
PROCEDURE ....................... ..... ....... ......................... 1
DATA AND RESULTS .. ...................................................... 2
Size of Business ...... .......... .......................... ............ 2
Sales and Total Value of Production .................... ...... ........... 2
Annual sales ............. ........ ......... ...... ............. 3
M monthly sales ........................ ..... ...... ........... 3
Land, Labor and Capital ... ... ................... ..................... 4
Land: bed and bench space .... .................. ...... ................ 4
Labor: full-time equivalent persons ................. .. .... .......... 4
Capital: owned and managed .................................... 4
Productivity Indicators ...... ............... ............... .................. 6
Land Use .. ....................................................... 7
Labor Use ......... ...... ......... .... ....... ........ 8
Capital Use ................................... .................... 8
Capital turnover ......... ...................... ... ............. 8
Capital managed per person .......... .............. ... ......... 8
Capital managed per acre ....................................... 8
Distribution of managed capital ................................... 11
Costs of Production .. .............................. .... .................. 11
Costs by Expense Category ... ................ .......... ............... 11
Salaries and wages ............................................. 11
Production supplies ............................................ 11
Other production costs .................. ........................ 11
Administrative and overhead .......................... ........... 11
Total cash costs ............................................... 11
Non-cash costs .... ...................... .................... 11
Total all costs ......... .............................. ......... 12
Costs as a Percent of the Total Cost ....................................... 12
Salaries and wages ................ ................................. 12
Production supplies ... ............ ....... .. ..................... 12
Other production costs ... ............................. ... ....... 12
Administrative and overhead .................. ................... 12
Total cash costs ............ .. ............................. 12
Cost Efficiency ....... ......... .......................................... 13
Cost Per Square Foot of Bed and Bench Space .............................. 13
Cost Per Square Foot of Propagating and Finishing Space ....................... 13
Cost Per Dollar's Worth of Production ................................... 15
Cost Per Dollar's Worth of Sales ....................................... 15









iv Flowering Plants

TABLE OF CONTENTS (Continued)

Page
Income Summary .......................................................... 16
Total Gain ............. ........................................... 16
Cost Deductions and Net Nursery Income ........................ ....... 16
Return on Capital ................................................... 17
Statement of Financial Position .................. ............................. 18
A assets .. .. .. .. .. ... .. ... .. ... ... .. ... ... .. ... ...... 18
Cash on hand ......................... ....................... 18
Accounts receivable .................................. ........ 18
Inventory values ............................................... 19
Total current assets ........................................... 19
Long term assets .................. .............. .... ......... 19
T otal assets .... .. .. ... ... .. ... .. ... .. ... .. ... ........ 19
L abilities . . .. . .. ... . . . . . . . . . 19
Current liabilities ....................................... ........ 19
Long term liabilities .................................... ....... 20
T otal liabilities ................................................ 20
N et W north ........................................................ 20
Total Profitability Model ...................... ............................ 20
Margin Management ................................................. 20
Asset M anagem ent ................................................. 20
Leverage M anagem ent ............................................... 20
CONCLUDING COMMENTS .................................................. 20

APPENDIX .................. ......................... ................... 23
D efinitions . . . . . . . . . . . . . .. . 24
Making your own calculations .................. ......... ... ................. 24
A ppendix Tables .................................... ..................... 26







Flowering Plants


LIST OF FIGURES


Figure-


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


LIST OF TABLES


Table


S:les, growing area, people and capital, 25 flowering plant nurseries in Florida, 1986, 19S7, 19SS
Costs of production, 25 flowering plant nurseries in Florida, 1986, 1987, 1988 ......
Income summary, 25 flowering plant nurseries in Florida, 1986, 1987, 1988 ................


Page


Page








Flowering Plants


LIST OF APPENDIX DATA TABLES


Appendix Table Page

1 Size of business, flowering plant nurseries in Florida, 1986, 1987, 1988 ................... 26
2 Rates of production, flowering plant nurseries in Florida, 1986, 1987, 1988 ............... 27
3 Land use indicators, flowering plant nurseries in Florida, 1986, 1987, 1988 ................ 27
4 Labor use indicators, flowering plant nurseries in Florida, 1986, 1987, 1988 ............... 27
5 Capital use indicators, flowering plant nurseries in Florida, 1986, 1987, 1988 .............. 28
6 Costs by expense category, flowering plant nurseries in Florida, 1986, 1987, 1988 ........... 29
7 Percent of total costs by expense category, flowering plant nurseries in Florida, 1986, 1987,1988 30
8 Costs per square foot of bed and bench space, flowering plant nurseries in
Florida, 1986, 1987, 1988 .................. .......................... 31
9 Costs per square foot of propagating and finishing space, flowering plant nurseries
in Florida, 1986, 1987, 1988 ................................................... 32
10 Costs per dollar's worth of production, flowering plant nurseries in
Florida, 1986, 1987, 1988 ............................................. 33
11 Cost per dollar's worth of sales (no adjustment for change in plant
inventory), flowering plant nurseries in Florida, 1986, 1987, 1988 ................. 34
12 Income summary, flowering plant nurseries in Florida, 1986, 1987, 1988 ................. 35
13 Statement of Financial Position, flowering plant nurseries in Florida, 1986, 1987, 19840 ....... 35
14 Financial Ratios and other profitability indicators, flowering plant nurseries
in Florida, 1986, 1987, 1988 ............................................ 36


* .













BUSINESS ANALYSIS OF FLOWERING PLANT NURSERIES IN FLORIDA,
1986, 1987, 19881

J. Robert Strain and Alan Hodges2


INTRODUCTION

This publication contains information on sales,
costs, returns and production efficiency for wholesale
flowering plant plant nurseries in Florida for 1986,
1987, 1988. This report complements the other
publications in the Florida Nursery Business Analysis
series which include reports on Central Florida
foliage plant nurseries, South Florida foliage plant
nurseries, Dade County foliage plant nurseries,
woody ornamental field nurseries, and woody
ornamental container nurseries. Purposes of the
nursery business analysis series include:

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

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

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

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


PROCEDURE

The information and averages presented in this
report are based on data supplied by nursery
operators in the form of confidential production and
accounting records. They participated in the program
voluntarily and do not represent a statistically
selected sample. However, the nursery operators
participating in the Florida Nursery Business Analysis
Program are thought to represent some of the more
efficient flowering plant nurseries in Florida, rather
than being typical of the industry. Nurseries
participating in the program are located in Northeast,
Central, and South Florida.

Data were collected for the 1986, 1987, and 1988
tax years. In most cases, this was for January
through December. Data for fiscal years ending
after July 1 in one year, and before July 1 the next
year were included with the corresponding calendar
year data. The number of firms providing data in
1986, 1987, and 1988 were 7, 5, and 7 firms
respectively. Nursery operators received an analysis
for their own operation, which contained similar
information as used in this report, shortly after
submitting 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


1. This document was published as Economic Information Report 264, Florida Cooperative Extension Service, Institute of Food and
Agricultural Sciences, Food and Resource Economics Dept., University of Florida, Gainesville, November, 1989.
2. J. Robert Strain is an Extension Economist, and Alan Hodges is an Economic Analyst, both in the Food and Resource Economics
Department, University of Florida, Gainesville, Florida 32611.

1
The Institute of Food and Agricultural Sciences is an Equal Opportunity/Affirmative Action Employer authorized to provide research, educa-
tional information and other services only to individuals and institutions that function without regard to race, color, sex, or national origin.
Florida Cooperative Extension Service / Institute of Food and Agricultural Sciences / University of Florida / John T. Woeste, Dean













BUSINESS ANALYSIS OF FLOWERING PLANT NURSERIES IN FLORIDA,
1986, 1987, 19881

J. Robert Strain and Alan Hodges2


INTRODUCTION

This publication contains information on sales,
costs, returns and production efficiency for wholesale
flowering plant plant nurseries in Florida for 1986,
1987, 1988. This report complements the other
publications in the Florida Nursery Business Analysis
series which include reports on Central Florida
foliage plant nurseries, South Florida foliage plant
nurseries, Dade County foliage plant nurseries,
woody ornamental field nurseries, and woody
ornamental container nurseries. Purposes of the
nursery business analysis series include:

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

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

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

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


PROCEDURE

The information and averages presented in this
report are based on data supplied by nursery
operators in the form of confidential production and
accounting records. They participated in the program
voluntarily and do not represent a statistically
selected sample. However, the nursery operators
participating in the Florida Nursery Business Analysis
Program are thought to represent some of the more
efficient flowering plant nurseries in Florida, rather
than being typical of the industry. Nurseries
participating in the program are located in Northeast,
Central, and South Florida.

Data were collected for the 1986, 1987, and 1988
tax years. In most cases, this was for January
through December. Data for fiscal years ending
after July 1 in one year, and before July 1 the next
year were included with the corresponding calendar
year data. The number of firms providing data in
1986, 1987, and 1988 were 7, 5, and 7 firms
respectively. Nursery operators received an analysis
for their own operation, which contained similar
information as used in this report, shortly after
submitting 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


1. This document was published as Economic Information Report 264, Florida Cooperative Extension Service, Institute of Food and
Agricultural Sciences, Food and Resource Economics Dept., University of Florida, Gainesville, November, 1989.
2. J. Robert Strain is an Extension Economist, and Alan Hodges is an Economic Analyst, both in the Food and Resource Economics
Department, University of Florida, Gainesville, Florida 32611.

1
The Institute of Food and Agricultural Sciences is an Equal Opportunity/Affirmative Action Employer authorized to provide research, educa-
tional information and other services only to individuals and institutions that function without regard to race, color, sex, or national origin.
Florida Cooperative Extension Service / Institute of Food and Agricultural Sciences / University of Florida / John T. Woeste, Dean









Flowering Plants


reason, interest expense paid by the individual
nursery operator was excluded from the costs listed
in this report. 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. A commonly accepted method of
evaluating inventory in the absence of detailed cost
accounting records, is to value all plants at 50
percent of their wholesale price when finished.
Otherwise, the values received from operators were
the values used in the analysis. 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.

DATA AND RESULTS

The key findings of this report appear in the text
in the form of charts and graphs. The tables and
figures present average values for all nurseries each
year. On charts where lines appear indicating a
range of data, the upper line represents the average
for the highest third of the firms (6) studied for that
measure, and lower line represents the average for
the lowest third (6). Nursery operators analyzing
their own operations may find this information
especially valuable for identifying the general area of
their business that may need additional study and
analysis. The data from which they were derived
may be found in the appendix tables at the end of
this report. The appendix tables include notations
on calculations involved for those who may wish to
examine some figures in further detail, and spaces
are provided for entering figures pertaining to your
own firm for comparison. Where tables appear in
this report, arithmetic inconsistencies from rounding
may be noted.


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

Sales and Total Value of Production
Annual sales. Sales figures used in this analysis
represent only plants produced by the nursery firm
itself. In other words, if any plants were purchased
for immediate resale, or "brokered", their value was
deducted from total sales to give the value of own
plants sold. Figure 1 illustrates the differences in
the average size of the firms studies for each of the
three years. Own plant sales averaged $558,537 for
the 1986 sample, $804,933 for the 1987 sample, and
$725,242 for the 1988 sample (Table 1).

Total value of production adjusts sales for change
in the value of the plant inventory during the year.
When the value of the plant inventory increases
during the year, total value of the year's productive
activities is greater than sales, and vice versa. For all
three sample years, plant inventory values increased,
giving a total value of production of $583,200 for the
1986 sample, $805,520 for the 1987 group, and
$731,316 for the 1988 sample (Table 1).

Monthly sales. Figure 2 shows the pattern ol
monthly sales for each year's sample. In 1986 anc
1988, peak sales were in March, whereas in 1981
the peak sales occurred in April. Together, the
months of March, April and May accounted for 3!
percent of total sales in 1986, and 40 percent in 198'
and 1988. All three years also show a second peal
in sales during November and December.









Flowering Plants


reason, interest expense paid by the individual
nursery operator was excluded from the costs listed
in this report. 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. A commonly accepted method of
evaluating inventory in the absence of detailed cost
accounting records, is to value all plants at 50
percent of their wholesale price when finished.
Otherwise, the values received from operators were
the values used in the analysis. 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.

DATA AND RESULTS

The key findings of this report appear in the text
in the form of charts and graphs. The tables and
figures present average values for all nurseries each
year. On charts where lines appear indicating a
range of data, the upper line represents the average
for the highest third of the firms (6) studied for that
measure, and lower line represents the average for
the lowest third (6). Nursery operators analyzing
their own operations may find this information
especially valuable for identifying the general area of
their business that may need additional study and
analysis. The data from which they were derived
may be found in the appendix tables at the end of
this report. The appendix tables include notations
on calculations involved for those who may wish to
examine some figures in further detail, and spaces
are provided for entering figures pertaining to your
own firm for comparison. Where tables appear in
this report, arithmetic inconsistencies from rounding
may be noted.


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

Sales and Total Value of Production
Annual sales. Sales figures used in this analysis
represent only plants produced by the nursery firm
itself. In other words, if any plants were purchased
for immediate resale, or "brokered", their value was
deducted from total sales to give the value of own
plants sold. Figure 1 illustrates the differences in
the average size of the firms studies for each of the
three years. Own plant sales averaged $558,537 for
the 1986 sample, $804,933 for the 1987 sample, and
$725,242 for the 1988 sample (Table 1).

Total value of production adjusts sales for change
in the value of the plant inventory during the year.
When the value of the plant inventory increases
during the year, total value of the year's productive
activities is greater than sales, and vice versa. For all
three sample years, plant inventory values increased,
giving a total value of production of $583,200 for the
1986 sample, $805,520 for the 1987 group, and
$731,316 for the 1988 sample (Table 1).

Monthly sales. Figure 2 shows the pattern ol
monthly sales for each year's sample. In 1986 anc
1988, peak sales were in March, whereas in 1981
the peak sales occurred in April. Together, the
months of March, April and May accounted for 3!
percent of total sales in 1986, and 40 percent in 198'
and 1988. All three years also show a second peal
in sales during November and December.









Flowering Plants


reason, interest expense paid by the individual
nursery operator was excluded from the costs listed
in this report. 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. A commonly accepted method of
evaluating inventory in the absence of detailed cost
accounting records, is to value all plants at 50
percent of their wholesale price when finished.
Otherwise, the values received from operators were
the values used in the analysis. 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.

DATA AND RESULTS

The key findings of this report appear in the text
in the form of charts and graphs. The tables and
figures present average values for all nurseries each
year. On charts where lines appear indicating a
range of data, the upper line represents the average
for the highest third of the firms (6) studied for that
measure, and lower line represents the average for
the lowest third (6). Nursery operators analyzing
their own operations may find this information
especially valuable for identifying the general area of
their business that may need additional study and
analysis. The data from which they were derived
may be found in the appendix tables at the end of
this report. The appendix tables include notations
on calculations involved for those who may wish to
examine some figures in further detail, and spaces
are provided for entering figures pertaining to your
own firm for comparison. Where tables appear in
this report, arithmetic inconsistencies from rounding
may be noted.


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

Sales and Total Value of Production
Annual sales. Sales figures used in this analysis
represent only plants produced by the nursery firm
itself. In other words, if any plants were purchased
for immediate resale, or "brokered", their value was
deducted from total sales to give the value of own
plants sold. Figure 1 illustrates the differences in
the average size of the firms studies for each of the
three years. Own plant sales averaged $558,537 for
the 1986 sample, $804,933 for the 1987 sample, and
$725,242 for the 1988 sample (Table 1).

Total value of production adjusts sales for change
in the value of the plant inventory during the year.
When the value of the plant inventory increases
during the year, total value of the year's productive
activities is greater than sales, and vice versa. For all
three sample years, plant inventory values increased,
giving a total value of production of $583,200 for the
1986 sample, $805,520 for the 1987 group, and
$731,316 for the 1988 sample (Table 1).

Monthly sales. Figure 2 shows the pattern ol
monthly sales for each year's sample. In 1986 anc
1988, peak sales were in March, whereas in 1981
the peak sales occurred in April. Together, the
months of March, April and May accounted for 3!
percent of total sales in 1986, and 40 percent in 198'
and 1988. All three years also show a second peal
in sales during November and December.






Flowering Plants


Figure 1
Sales and Total Value of

Flowering Plant Nurseries,


Production

1986, '87, '88


1000


800

600


400


200


0


Do I lars


1986 1987 1988


M sales


M value of Production


Table 1--Sales, bed and bench space, people, and capital, flowering plant nurseries in Florida, 1986, 1987, 1988.


1986 1987 1988
unit sample sample sample
............................................................... .........................
Value of own plants sold ..... .. 558,537 804,933 725,242
Change in inventory value. ... $ 24,663 587 6,074

Total value of production. ..... .S 583,200 805,520 731,316

Total bed & bench space. . .sq.ft. 96,119 130,768 116,214

Full-time equivalent persons .number 34.93 21.96 21.83

Total Owned Capital. ..... $ 353,419 588,097 441,307
Total Leased Capital ...... 284,071 39,300 28,071
===Total Managed Capital====S 637,491 627,397 469,378=
Total Managed Capital...... $ 637,491 627,397 469,378


Ce Appendix Table 1 for more detail.






Flowering Plants


Figure 1
Sales and Total Value of

Flowering Plant Nurseries,


Production

1986, '87, '88


1000


800

600


400


200


0


Do I lars


1986 1987 1988


M sales


M value of Production


Table 1--Sales, bed and bench space, people, and capital, flowering plant nurseries in Florida, 1986, 1987, 1988.


1986 1987 1988
unit sample sample sample
............................................................... .........................
Value of own plants sold ..... .. 558,537 804,933 725,242
Change in inventory value. ... $ 24,663 587 6,074

Total value of production. ..... .S 583,200 805,520 731,316

Total bed & bench space. . .sq.ft. 96,119 130,768 116,214

Full-time equivalent persons .number 34.93 21.96 21.83

Total Owned Capital. ..... $ 353,419 588,097 441,307
Total Leased Capital ...... 284,071 39,300 28,071
===Total Managed Capital====S 637,491 627,397 469,378=
Total Managed Capital...... $ 637,491 627,397 469,378


Ce Appendix Table 1 for more detail.








Flowering Plants


Land, Labor and Capital
Land: bed and bench space. Total bed and bench
space averaged 96,119 square feet for the 1986
sample of nurseries, 130,768 square feet for the 1988
sample, and 116,214 square feet for the 1988 sample
(Table 1 and Figure 3). Propagating and finishing
space (that portion of bed and bench space used to
grow plants for sale) averaged 92,589 square feet for
the 1986 sample, 128,221 square feet for 1987
sample, and 114,347 square feet for the 1988 sample.
Stock plant area is bed and bench space used
exclusively for production of plant propagating
material. This area averaged 3,530 square feet for
the 1986 sample, 2,547 square feet for the 1987
sample, and 1,867 square feet for the 1988 sample.
Total nursery area, which includes drives, roads,
parking lots, office, packing house and the like,
averaged 3.1 acres for the 1986 sample, 4.5 acres for
the 1987 sample, and 3.9 acres for the 1988 sample.

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
the 1986 sample was 34.9, for the 1987 sample it was
22.0, and for the 1988 sample it was 21.8 (Table 1
and Figure 4).

Capital: owned and managed. Capital owned is
the current value (original cost less depreciation) of
capital assets in the nursery operation, including
plants in inventory, equipment, buildings, land,
accounts receivable and cash on hand. For the
nurseries in the 1986 sample, capital owned averaged
$353,419. A different sample of firms in 1987
averaged $588,097, and the 1988 group averaged
$441,307. 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, such
as leased property. Capital managed averaged
$637,491 for the 1986 sample, $627,397 for the 1987
sample, and $469,378 for the 1988 sample (Table 1
and Figure 5).


Figure 2

Monthly Sales
Flowering Plant Nurseries, 1986, '87, '88

Dol lars (Thousands)
200



Samrple Year
1986
100 --
--- 1987
-- 1988
50



Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
MONTH








Flowering Plants


Land, Labor and Capital
Land: bed and bench space. Total bed and bench
space averaged 96,119 square feet for the 1986
sample of nurseries, 130,768 square feet for the 1988
sample, and 116,214 square feet for the 1988 sample
(Table 1 and Figure 3). Propagating and finishing
space (that portion of bed and bench space used to
grow plants for sale) averaged 92,589 square feet for
the 1986 sample, 128,221 square feet for 1987
sample, and 114,347 square feet for the 1988 sample.
Stock plant area is bed and bench space used
exclusively for production of plant propagating
material. This area averaged 3,530 square feet for
the 1986 sample, 2,547 square feet for the 1987
sample, and 1,867 square feet for the 1988 sample.
Total nursery area, which includes drives, roads,
parking lots, office, packing house and the like,
averaged 3.1 acres for the 1986 sample, 4.5 acres for
the 1987 sample, and 3.9 acres for the 1988 sample.

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
the 1986 sample was 34.9, for the 1987 sample it was
22.0, and for the 1988 sample it was 21.8 (Table 1
and Figure 4).

Capital: owned and managed. Capital owned is
the current value (original cost less depreciation) of
capital assets in the nursery operation, including
plants in inventory, equipment, buildings, land,
accounts receivable and cash on hand. For the
nurseries in the 1986 sample, capital owned averaged
$353,419. A different sample of firms in 1987
averaged $588,097, and the 1988 group averaged
$441,307. 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, such
as leased property. Capital managed averaged
$637,491 for the 1986 sample, $627,397 for the 1987
sample, and $469,378 for the 1988 sample (Table 1
and Figure 5).


Figure 2

Monthly Sales
Flowering Plant Nurseries, 1986, '87, '88

Dol lars (Thousands)
200



Samrple Year
1986
100 --
--- 1987
-- 1988
50



Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
MONTH








Flowering Plants


Land, Labor and Capital
Land: bed and bench space. Total bed and bench
space averaged 96,119 square feet for the 1986
sample of nurseries, 130,768 square feet for the 1988
sample, and 116,214 square feet for the 1988 sample
(Table 1 and Figure 3). Propagating and finishing
space (that portion of bed and bench space used to
grow plants for sale) averaged 92,589 square feet for
the 1986 sample, 128,221 square feet for 1987
sample, and 114,347 square feet for the 1988 sample.
Stock plant area is bed and bench space used
exclusively for production of plant propagating
material. This area averaged 3,530 square feet for
the 1986 sample, 2,547 square feet for the 1987
sample, and 1,867 square feet for the 1988 sample.
Total nursery area, which includes drives, roads,
parking lots, office, packing house and the like,
averaged 3.1 acres for the 1986 sample, 4.5 acres for
the 1987 sample, and 3.9 acres for the 1988 sample.

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
the 1986 sample was 34.9, for the 1987 sample it was
22.0, and for the 1988 sample it was 21.8 (Table 1
and Figure 4).

Capital: owned and managed. Capital owned is
the current value (original cost less depreciation) of
capital assets in the nursery operation, including
plants in inventory, equipment, buildings, land,
accounts receivable and cash on hand. For the
nurseries in the 1986 sample, capital owned averaged
$353,419. A different sample of firms in 1987
averaged $588,097, and the 1988 group averaged
$441,307. 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, such
as leased property. Capital managed averaged
$637,491 for the 1986 sample, $627,397 for the 1987
sample, and $469,378 for the 1988 sample (Table 1
and Figure 5).


Figure 2

Monthly Sales
Flowering Plant Nurseries, 1986, '87, '88

Dol lars (Thousands)
200



Samrple Year
1986
100 --
--- 1987
-- 1988
50



Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
MONTH








Flowering Plants


Land, Labor and Capital
Land: bed and bench space. Total bed and bench
space averaged 96,119 square feet for the 1986
sample of nurseries, 130,768 square feet for the 1988
sample, and 116,214 square feet for the 1988 sample
(Table 1 and Figure 3). Propagating and finishing
space (that portion of bed and bench space used to
grow plants for sale) averaged 92,589 square feet for
the 1986 sample, 128,221 square feet for 1987
sample, and 114,347 square feet for the 1988 sample.
Stock plant area is bed and bench space used
exclusively for production of plant propagating
material. This area averaged 3,530 square feet for
the 1986 sample, 2,547 square feet for the 1987
sample, and 1,867 square feet for the 1988 sample.
Total nursery area, which includes drives, roads,
parking lots, office, packing house and the like,
averaged 3.1 acres for the 1986 sample, 4.5 acres for
the 1987 sample, and 3.9 acres for the 1988 sample.

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
the 1986 sample was 34.9, for the 1987 sample it was
22.0, and for the 1988 sample it was 21.8 (Table 1
and Figure 4).

Capital: owned and managed. Capital owned is
the current value (original cost less depreciation) of
capital assets in the nursery operation, including
plants in inventory, equipment, buildings, land,
accounts receivable and cash on hand. For the
nurseries in the 1986 sample, capital owned averaged
$353,419. A different sample of firms in 1987
averaged $588,097, and the 1988 group averaged
$441,307. 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, such
as leased property. Capital managed averaged
$637,491 for the 1986 sample, $627,397 for the 1987
sample, and $469,378 for the 1988 sample (Table 1
and Figure 5).


Figure 2

Monthly Sales
Flowering Plant Nurseries, 1986, '87, '88

Dol lars (Thousands)
200



Samrple Year
1986
100 --
--- 1987
-- 1988
50



Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
MONTH








Flowering Plants 5


Figure 3

Land: Bed and Bench Space

Flowering Plant Nurseries, 1986, '87, '88


Square Feet Cthousands)
140

120

100

80



40


20

0


1986 1987 'gee


Figure 4

Labor: Number of Persons

Flowering Plant Nurseries, 1986, '87, '88


Full-time Equiv. Persons C2080 hrs/yr)
40

35

30

25 --..----

20 \

15

10



0


19BB


1987


1988


1986


1987


1988








Flowering Plants


Figure 5
Cap ital Managed
Flowering Plant Nurseries, 1986, '87, '88


Dol lars


Thousands)


1986 1987
Capital managed


Capital Leased
| Capital Owned


is owned plus leased.


acre, for the 1987 sample, $180,931 per acre, and for
the 1988 sample, $187,641 per acre.

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. Lower sales per square foot of bed and
bench space can be the result of a number of things:
plants remaining after reaching salable size, high
amount of vacant space, slow-growing plant varieties,
and disease and quality problems that reduce yields
of salable plants. In addition, nursery layout and
and growing techniques can affect production per
square foot.

Plant inventory value per square foot in
production is another indicator of efficiency in the
use of space. This averaged $1.34 for the 1986
sample, $1.27 for the 1987 sample, and $1.06 for the
1988 sample. For ongoing operations, low plant
inventory values per acre imply either inefficient use
of land and/or unwise selection of crops grown in
terms of the relationship between their price and
growing area requirements.


Productivity Indicators

Land Use (Appendix Table 2)
The most accurate indicator of efficiency for the
use of land is value of production per square foot of
propagating and finishing space. Value of production
(annual sales of own plants plus change in the value
of plant inventory) per square foot of propagating
and finishing space averaged $6.30 for the 1986
sample, $6.28 for the 1987 sample, and $6.40 for the
1988 sample. Value of production per square foot
of total bed and bench space (includes stock plant
space) was $6.07 for the 1986 sample, $6.16 for the
1987 sample, and $6.29 for the 1988 sample (Figure
6). Firms with the highest annual rates of
production averaged $11.09 per square foot, while
those with the lowest averaged $4.61 per square foot.

In terms of value of production per acre of total
nursery area (includes non-growing areas such as
office, parking, packing house, walkways, driveways),
the average for the 1986 sample was $187,997 per







Flowering Plants


Figure 6
Land Use: Value of Production/Sq. Ft.


Flowering Plant Nurseries,

Do I lars/Sq,Ft.

SI--


2 I- .......................


1986, '87, '88









-*- Highest rates
SLowest rates


1986 1987 1988


Another indicator of efficiency for the use of land
is turnover of plant inventory, calculated by dividing
annual sales by average plant inventory. Turnover of
plant inventory averaged 434 percent for the 1986
sample, 486 percent for the 1987 sample, and 587
percent for the 1988 sample.

Vacant bed and bench space averaged 18 percent
of the total for the 1986 sample, 18 percent for the
1987 sample, and 19 percent for the 1988 sample
(Appendix Table 4).

Labor Use (Appendix Table 3).
Value of production per full-time equivalent
person (2080 hrs/year) is one of the best measures
of efficiency for the use of labor. This indicator
averaged $16,697 per person for the 1986 sample,
$36,682 for the 1987 sample, and $33,500 for the
19&S sample (Figure 7). Highest rates of production
per person averaged $46,329 per person, and lowest
rates were $11,968 (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 2,752
square feet for the 1986 sample, 5,955 square feet


for the 1987 sample, and 5,324 square feet for the
1988 sample. Stated another way, the number of
persons per acre of bed and bench space averaged
15.8 for the 1986 sample, 7.3 for the 1987 sample,
and 8.2 for the 1988 sample.

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

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







Flowering Plants


Figure 6
Land Use: Value of Production/Sq. Ft.


Flowering Plant Nurseries,

Do I lars/Sq,Ft.

SI--


2 I- .......................


1986, '87, '88









-*- Highest rates
SLowest rates


1986 1987 1988


Another indicator of efficiency for the use of land
is turnover of plant inventory, calculated by dividing
annual sales by average plant inventory. Turnover of
plant inventory averaged 434 percent for the 1986
sample, 486 percent for the 1987 sample, and 587
percent for the 1988 sample.

Vacant bed and bench space averaged 18 percent
of the total for the 1986 sample, 18 percent for the
1987 sample, and 19 percent for the 1988 sample
(Appendix Table 4).

Labor Use (Appendix Table 3).
Value of production per full-time equivalent
person (2080 hrs/year) is one of the best measures
of efficiency for the use of labor. This indicator
averaged $16,697 per person for the 1986 sample,
$36,682 for the 1987 sample, and $33,500 for the
19&S sample (Figure 7). Highest rates of production
per person averaged $46,329 per person, and lowest
rates were $11,968 (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 2,752
square feet for the 1986 sample, 5,955 square feet


for the 1987 sample, and 5,324 square feet for the
1988 sample. Stated another way, the number of
persons per acre of bed and bench space averaged
15.8 for the 1986 sample, 7.3 for the 1987 sample,
and 8.2 for the 1988 sample.

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

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








Flowering Plants


Capital Use (Appendix Table 4)
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 the 1986 sample
averaged 158.0 percent, for the 1987 sample 136.9
percent, and for the 1988 sample 164.3 percent
(Figure 8). This means that annual sales were
roughly 1.3 to 1.6 times the value of the capital
investment. Highest capital turnover rates averaged
191 percent and lowest rates averaged 100 percent.

In general, larger percentage turnover numbers
are desirable, for they indicate greater sales per
dollar of investment in the nursery. Turnover rates
are reduced by any of the previously mentioned
problems which lower production rate. These lower
sales for a given nursery investment. Low capital
turnover is particularly common in nurseries just
getting started, or in nurseries that are expanding
rapidly. Excessive investments in land, labor saving
machinery and equipment will also tend to lower the
captial turnover rate.


Capital Managed Per Person. Capital managed
per full-time equivalent person averaged $18,251 for
the 1986 sample, $28,571 for the 1987 sample, and
$21,501 for the 1988 sample (Figure 9). Highest rates
for capital managed per person averaged $66,086 and
lowest rates averaged $8,389 (Figure 9).

Capital Managed Per Acre. Capital managed per
acre of total nursery area averaged $205,498 per acre
for the 1986 sample, $140,922 for the 1987 sample,
and $120,433 for the 1988 sample (Figure 10).
Highest rates of capital managed per acre were
$314,083 and lowest rates averaged $93,776 (Figure
10).


Figure 7
Labor Use: Value of Production/Person
Flowering Plant Nurseries, 1986, '87, '88


Dollars/Employee Equiv. (thousands)
50


40
4 0 .............. ...............................................................................................


30 .................... ..........................
,4,*- Highest Rates
,,, Lowest Rates
20





O198 1987 1988
1986 1997 198








Flowering Plants


Capital Use (Appendix Table 4)
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 the 1986 sample
averaged 158.0 percent, for the 1987 sample 136.9
percent, and for the 1988 sample 164.3 percent
(Figure 8). This means that annual sales were
roughly 1.3 to 1.6 times the value of the capital
investment. Highest capital turnover rates averaged
191 percent and lowest rates averaged 100 percent.

In general, larger percentage turnover numbers
are desirable, for they indicate greater sales per
dollar of investment in the nursery. Turnover rates
are reduced by any of the previously mentioned
problems which lower production rate. These lower
sales for a given nursery investment. Low capital
turnover is particularly common in nurseries just
getting started, or in nurseries that are expanding
rapidly. Excessive investments in land, labor saving
machinery and equipment will also tend to lower the
captial turnover rate.


Capital Managed Per Person. Capital managed
per full-time equivalent person averaged $18,251 for
the 1986 sample, $28,571 for the 1987 sample, and
$21,501 for the 1988 sample (Figure 9). Highest rates
for capital managed per person averaged $66,086 and
lowest rates averaged $8,389 (Figure 9).

Capital Managed Per Acre. Capital managed per
acre of total nursery area averaged $205,498 per acre
for the 1986 sample, $140,922 for the 1987 sample,
and $120,433 for the 1988 sample (Figure 10).
Highest rates of capital managed per acre were
$314,083 and lowest rates averaged $93,776 (Figure
10).


Figure 7
Labor Use: Value of Production/Person
Flowering Plant Nurseries, 1986, '87, '88


Dollars/Employee Equiv. (thousands)
50


40
4 0 .............. ...............................................................................................


30 .................... ..........................
,4,*- Highest Rates
,,, Lowest Rates
20





O198 1987 1988
1986 1997 198








Flowering Plants


Capital Use (Appendix Table 4)
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 the 1986 sample
averaged 158.0 percent, for the 1987 sample 136.9
percent, and for the 1988 sample 164.3 percent
(Figure 8). This means that annual sales were
roughly 1.3 to 1.6 times the value of the capital
investment. Highest capital turnover rates averaged
191 percent and lowest rates averaged 100 percent.

In general, larger percentage turnover numbers
are desirable, for they indicate greater sales per
dollar of investment in the nursery. Turnover rates
are reduced by any of the previously mentioned
problems which lower production rate. These lower
sales for a given nursery investment. Low capital
turnover is particularly common in nurseries just
getting started, or in nurseries that are expanding
rapidly. Excessive investments in land, labor saving
machinery and equipment will also tend to lower the
captial turnover rate.


Capital Managed Per Person. Capital managed
per full-time equivalent person averaged $18,251 for
the 1986 sample, $28,571 for the 1987 sample, and
$21,501 for the 1988 sample (Figure 9). Highest rates
for capital managed per person averaged $66,086 and
lowest rates averaged $8,389 (Figure 9).

Capital Managed Per Acre. Capital managed per
acre of total nursery area averaged $205,498 per acre
for the 1986 sample, $140,922 for the 1987 sample,
and $120,433 for the 1988 sample (Figure 10).
Highest rates of capital managed per acre were
$314,083 and lowest rates averaged $93,776 (Figure
10).


Figure 7
Labor Use: Value of Production/Person
Flowering Plant Nurseries, 1986, '87, '88


Dollars/Employee Equiv. (thousands)
50


40
4 0 .............. ...............................................................................................


30 .................... ..........................
,4,*- Highest Rates
,,, Lowest Rates
20





O198 1987 1988
1986 1997 198








Flowering Plants


Capital Use (Appendix Table 4)
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 the 1986 sample
averaged 158.0 percent, for the 1987 sample 136.9
percent, and for the 1988 sample 164.3 percent
(Figure 8). This means that annual sales were
roughly 1.3 to 1.6 times the value of the capital
investment. Highest capital turnover rates averaged
191 percent and lowest rates averaged 100 percent.

In general, larger percentage turnover numbers
are desirable, for they indicate greater sales per
dollar of investment in the nursery. Turnover rates
are reduced by any of the previously mentioned
problems which lower production rate. These lower
sales for a given nursery investment. Low capital
turnover is particularly common in nurseries just
getting started, or in nurseries that are expanding
rapidly. Excessive investments in land, labor saving
machinery and equipment will also tend to lower the
captial turnover rate.


Capital Managed Per Person. Capital managed
per full-time equivalent person averaged $18,251 for
the 1986 sample, $28,571 for the 1987 sample, and
$21,501 for the 1988 sample (Figure 9). Highest rates
for capital managed per person averaged $66,086 and
lowest rates averaged $8,389 (Figure 9).

Capital Managed Per Acre. Capital managed per
acre of total nursery area averaged $205,498 per acre
for the 1986 sample, $140,922 for the 1987 sample,
and $120,433 for the 1988 sample (Figure 10).
Highest rates of capital managed per acre were
$314,083 and lowest rates averaged $93,776 (Figure
10).


Figure 7
Labor Use: Value of Production/Person
Flowering Plant Nurseries, 1986, '87, '88


Dollars/Employee Equiv. (thousands)
50


40
4 0 .............. ...............................................................................................


30 .................... ..........................
,4,*- Highest Rates
,,, Lowest Rates
20





O198 1987 1988
1986 1997 198






Flowering Plants


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 flowering plant nurseries sampled in 1988. Plant
inventory represented the largest share of capital
managed, 26.3 percent. Next in importance were
land (22.6 percent), accounts receivable (19.5
percent), and buildings/installations (17.7 percent).
Other lesser areas of capital managed were
machinery and equipment (5.4 percent), and supplies
and cash (8.5 percent).


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


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

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 undetermined, so a time-value
was estimated based upon the operator's expected


earnings, or previous experience. The operator's
salary or time value averaged $34,228 for the 1986
sample, $32,852 for the 1987 sample, and $30,738 for
the 1988 sample. Wages, salaries, and associated
expenses for employees averaged $154,602 for the
1986 sample, $250,597 for the 1987 sample, and
$218,703 for the 1988 sample. Thus, total expenses
on wages and salaries averaged $188,890 for the 1986
sample, $283,449 for the 1987 sample, and $249,441
for the 1988 sample (Table 2).

Production supplies. Expenses for production
supplies include plants and seeds, containers,
production heat, peat and soil, fertilizer and lime,
pesticides and chemicals, packing and shipping
materials, and other production supplies. Expenses
for supplies for the 1986 sample averaged $213,177,
for the 1987 sample $260,403, and for the 1988
sample $279,007.

Other production costs. Other production costs
are facility repairs/maintenance and equipment
operating costs. For the 1986 sample they averaged
$29,772, for the 1987 sample $42,660, and for the
1988 sample $39,034.

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 $74,333 for the 1986 sample,
$104,082 for the 1987 sample, and $71,462 for the
1988 sample.

Total cash costs. Total cash costs, including all
items mentioned above, averaged $506,172 for the
1986 sample, $690,594 for the 1987 sample, and
$638,944 for the 1988 sample.

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 $71,349 for the 1986 sample, $109,261
for the 1987 sample, and $85,984 for the 1988
sample.








Flowering Plants


Figure B

Capital Turnover

Flowering Plant Nurseries, 1986, '87, '88


Sales as a Percentage of Capital Owned
200
I ,I i: [- :i,


150 ..... .... ...



100 --....



50 .........................
50



0


-- Highest Rates

--L Lowest Rates


1966 1967 1988


1986 1987 1988


Figure 9

Capital Managed Per Person

Flowering Plant Nurseries, 1986 '87, '88


Do lars per Person Cthousands)
70 ---
I[ II


- Highest Rates

-- Lowest Rates


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

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

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


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


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


I












Flowering Plants


Figure 10

Capital Managed Per Acre

Flowering Plant Nurseries, 1986 '87, 88


Dollars per Acre CthousandsD
350


300------

3 0 ....................................................................................................................


S Highest Rates

SLowest Rates


1986 1987 1988


Figure 11

Distribution of Managed Capital

Flowering Plant Nurseries, 1988


Cash on hand
5. 9%

Growing plants
26.3% Accounts rec:
19.5%


SLpply Inventory
2.7%


BIdge, ilrprovementsm .
17.7%
NA22.6x
Mchinery & equip.
5.4%


Includes capital owned
plus capital leased


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


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


... .... ....... m ..........................


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


. .......... I .............


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





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


eivable






Flowering Plants


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 flowering plant nurseries sampled in 1988. Plant
inventory represented the largest share of capital
managed, 26.3 percent. Next in importance were
land (22.6 percent), accounts receivable (19.5
percent), and buildings/installations (17.7 percent).
Other lesser areas of capital managed were
machinery and equipment (5.4 percent), and supplies
and cash (8.5 percent).


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


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

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 undetermined, so a time-value
was estimated based upon the operator's expected


earnings, or previous experience. The operator's
salary or time value averaged $34,228 for the 1986
sample, $32,852 for the 1987 sample, and $30,738 for
the 1988 sample. Wages, salaries, and associated
expenses for employees averaged $154,602 for the
1986 sample, $250,597 for the 1987 sample, and
$218,703 for the 1988 sample. Thus, total expenses
on wages and salaries averaged $188,890 for the 1986
sample, $283,449 for the 1987 sample, and $249,441
for the 1988 sample (Table 2).

Production supplies. Expenses for production
supplies include plants and seeds, containers,
production heat, peat and soil, fertilizer and lime,
pesticides and chemicals, packing and shipping
materials, and other production supplies. Expenses
for supplies for the 1986 sample averaged $213,177,
for the 1987 sample $260,403, and for the 1988
sample $279,007.

Other production costs. Other production costs
are facility repairs/maintenance and equipment
operating costs. For the 1986 sample they averaged
$29,772, for the 1987 sample $42,660, and for the
1988 sample $39,034.

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 $74,333 for the 1986 sample,
$104,082 for the 1987 sample, and $71,462 for the
1988 sample.

Total cash costs. Total cash costs, including all
items mentioned above, averaged $506,172 for the
1986 sample, $690,594 for the 1987 sample, and
$638,944 for the 1988 sample.

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 $71,349 for the 1986 sample, $109,261
for the 1987 sample, and $85,984 for the 1988
sample.






Flowering Plants


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 flowering plant nurseries sampled in 1988. Plant
inventory represented the largest share of capital
managed, 26.3 percent. Next in importance were
land (22.6 percent), accounts receivable (19.5
percent), and buildings/installations (17.7 percent).
Other lesser areas of capital managed were
machinery and equipment (5.4 percent), and supplies
and cash (8.5 percent).


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


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

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 undetermined, so a time-value
was estimated based upon the operator's expected


earnings, or previous experience. The operator's
salary or time value averaged $34,228 for the 1986
sample, $32,852 for the 1987 sample, and $30,738 for
the 1988 sample. Wages, salaries, and associated
expenses for employees averaged $154,602 for the
1986 sample, $250,597 for the 1987 sample, and
$218,703 for the 1988 sample. Thus, total expenses
on wages and salaries averaged $188,890 for the 1986
sample, $283,449 for the 1987 sample, and $249,441
for the 1988 sample (Table 2).

Production supplies. Expenses for production
supplies include plants and seeds, containers,
production heat, peat and soil, fertilizer and lime,
pesticides and chemicals, packing and shipping
materials, and other production supplies. Expenses
for supplies for the 1986 sample averaged $213,177,
for the 1987 sample $260,403, and for the 1988
sample $279,007.

Other production costs. Other production costs
are facility repairs/maintenance and equipment
operating costs. For the 1986 sample they averaged
$29,772, for the 1987 sample $42,660, and for the
1988 sample $39,034.

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 $74,333 for the 1986 sample,
$104,082 for the 1987 sample, and $71,462 for the
1988 sample.

Total cash costs. Total cash costs, including all
items mentioned above, averaged $506,172 for the
1986 sample, $690,594 for the 1987 sample, and
$638,944 for the 1988 sample.

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 $71,349 for the 1986 sample, $109,261
for the 1987 sample, and $85,984 for the 1988
sample.






Flowering Plants


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 flowering plant nurseries sampled in 1988. Plant
inventory represented the largest share of capital
managed, 26.3 percent. Next in importance were
land (22.6 percent), accounts receivable (19.5
percent), and buildings/installations (17.7 percent).
Other lesser areas of capital managed were
machinery and equipment (5.4 percent), and supplies
and cash (8.5 percent).


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


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

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 undetermined, so a time-value
was estimated based upon the operator's expected


earnings, or previous experience. The operator's
salary or time value averaged $34,228 for the 1986
sample, $32,852 for the 1987 sample, and $30,738 for
the 1988 sample. Wages, salaries, and associated
expenses for employees averaged $154,602 for the
1986 sample, $250,597 for the 1987 sample, and
$218,703 for the 1988 sample. Thus, total expenses
on wages and salaries averaged $188,890 for the 1986
sample, $283,449 for the 1987 sample, and $249,441
for the 1988 sample (Table 2).

Production supplies. Expenses for production
supplies include plants and seeds, containers,
production heat, peat and soil, fertilizer and lime,
pesticides and chemicals, packing and shipping
materials, and other production supplies. Expenses
for supplies for the 1986 sample averaged $213,177,
for the 1987 sample $260,403, and for the 1988
sample $279,007.

Other production costs. Other production costs
are facility repairs/maintenance and equipment
operating costs. For the 1986 sample they averaged
$29,772, for the 1987 sample $42,660, and for the
1988 sample $39,034.

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 $74,333 for the 1986 sample,
$104,082 for the 1987 sample, and $71,462 for the
1988 sample.

Total cash costs. Total cash costs, including all
items mentioned above, averaged $506,172 for the
1986 sample, $690,594 for the 1987 sample, and
$638,944 for the 1988 sample.

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 $71,349 for the 1986 sample, $109,261
for the 1987 sample, and $85,984 for the 1988
sample.






Flowering Plants


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 flowering plant nurseries sampled in 1988. Plant
inventory represented the largest share of capital
managed, 26.3 percent. Next in importance were
land (22.6 percent), accounts receivable (19.5
percent), and buildings/installations (17.7 percent).
Other lesser areas of capital managed were
machinery and equipment (5.4 percent), and supplies
and cash (8.5 percent).


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


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

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 undetermined, so a time-value
was estimated based upon the operator's expected


earnings, or previous experience. The operator's
salary or time value averaged $34,228 for the 1986
sample, $32,852 for the 1987 sample, and $30,738 for
the 1988 sample. Wages, salaries, and associated
expenses for employees averaged $154,602 for the
1986 sample, $250,597 for the 1987 sample, and
$218,703 for the 1988 sample. Thus, total expenses
on wages and salaries averaged $188,890 for the 1986
sample, $283,449 for the 1987 sample, and $249,441
for the 1988 sample (Table 2).

Production supplies. Expenses for production
supplies include plants and seeds, containers,
production heat, peat and soil, fertilizer and lime,
pesticides and chemicals, packing and shipping
materials, and other production supplies. Expenses
for supplies for the 1986 sample averaged $213,177,
for the 1987 sample $260,403, and for the 1988
sample $279,007.

Other production costs. Other production costs
are facility repairs/maintenance and equipment
operating costs. For the 1986 sample they averaged
$29,772, for the 1987 sample $42,660, and for the
1988 sample $39,034.

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 $74,333 for the 1986 sample,
$104,082 for the 1987 sample, and $71,462 for the
1988 sample.

Total cash costs. Total cash costs, including all
items mentioned above, averaged $506,172 for the
1986 sample, $690,594 for the 1987 sample, and
$638,944 for the 1988 sample.

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 $71,349 for the 1986 sample, $109,261
for the 1987 sample, and $85,984 for the 1988
sample.






Flowering Plants


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 flowering plant nurseries sampled in 1988. Plant
inventory represented the largest share of capital
managed, 26.3 percent. Next in importance were
land (22.6 percent), accounts receivable (19.5
percent), and buildings/installations (17.7 percent).
Other lesser areas of capital managed were
machinery and equipment (5.4 percent), and supplies
and cash (8.5 percent).


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


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

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 undetermined, so a time-value
was estimated based upon the operator's expected


earnings, or previous experience. The operator's
salary or time value averaged $34,228 for the 1986
sample, $32,852 for the 1987 sample, and $30,738 for
the 1988 sample. Wages, salaries, and associated
expenses for employees averaged $154,602 for the
1986 sample, $250,597 for the 1987 sample, and
$218,703 for the 1988 sample. Thus, total expenses
on wages and salaries averaged $188,890 for the 1986
sample, $283,449 for the 1987 sample, and $249,441
for the 1988 sample (Table 2).

Production supplies. Expenses for production
supplies include plants and seeds, containers,
production heat, peat and soil, fertilizer and lime,
pesticides and chemicals, packing and shipping
materials, and other production supplies. Expenses
for supplies for the 1986 sample averaged $213,177,
for the 1987 sample $260,403, and for the 1988
sample $279,007.

Other production costs. Other production costs
are facility repairs/maintenance and equipment
operating costs. For the 1986 sample they averaged
$29,772, for the 1987 sample $42,660, and for the
1988 sample $39,034.

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 $74,333 for the 1986 sample,
$104,082 for the 1987 sample, and $71,462 for the
1988 sample.

Total cash costs. Total cash costs, including all
items mentioned above, averaged $506,172 for the
1986 sample, $690,594 for the 1987 sample, and
$638,944 for the 1988 sample.

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 $71,349 for the 1986 sample, $109,261
for the 1987 sample, and $85,984 for the 1988
sample.






Flowering Plants


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 flowering plant nurseries sampled in 1988. Plant
inventory represented the largest share of capital
managed, 26.3 percent. Next in importance were
land (22.6 percent), accounts receivable (19.5
percent), and buildings/installations (17.7 percent).
Other lesser areas of capital managed were
machinery and equipment (5.4 percent), and supplies
and cash (8.5 percent).


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


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

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 undetermined, so a time-value
was estimated based upon the operator's expected


earnings, or previous experience. The operator's
salary or time value averaged $34,228 for the 1986
sample, $32,852 for the 1987 sample, and $30,738 for
the 1988 sample. Wages, salaries, and associated
expenses for employees averaged $154,602 for the
1986 sample, $250,597 for the 1987 sample, and
$218,703 for the 1988 sample. Thus, total expenses
on wages and salaries averaged $188,890 for the 1986
sample, $283,449 for the 1987 sample, and $249,441
for the 1988 sample (Table 2).

Production supplies. Expenses for production
supplies include plants and seeds, containers,
production heat, peat and soil, fertilizer and lime,
pesticides and chemicals, packing and shipping
materials, and other production supplies. Expenses
for supplies for the 1986 sample averaged $213,177,
for the 1987 sample $260,403, and for the 1988
sample $279,007.

Other production costs. Other production costs
are facility repairs/maintenance and equipment
operating costs. For the 1986 sample they averaged
$29,772, for the 1987 sample $42,660, and for the
1988 sample $39,034.

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 $74,333 for the 1986 sample,
$104,082 for the 1987 sample, and $71,462 for the
1988 sample.

Total cash costs. Total cash costs, including all
items mentioned above, averaged $506,172 for the
1986 sample, $690,594 for the 1987 sample, and
$638,944 for the 1988 sample.

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 $71,349 for the 1986 sample, $109,261
for the 1987 sample, and $85,984 for the 1988
sample.






Flowering Plants


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 flowering plant nurseries sampled in 1988. Plant
inventory represented the largest share of capital
managed, 26.3 percent. Next in importance were
land (22.6 percent), accounts receivable (19.5
percent), and buildings/installations (17.7 percent).
Other lesser areas of capital managed were
machinery and equipment (5.4 percent), and supplies
and cash (8.5 percent).


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


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

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 undetermined, so a time-value
was estimated based upon the operator's expected


earnings, or previous experience. The operator's
salary or time value averaged $34,228 for the 1986
sample, $32,852 for the 1987 sample, and $30,738 for
the 1988 sample. Wages, salaries, and associated
expenses for employees averaged $154,602 for the
1986 sample, $250,597 for the 1987 sample, and
$218,703 for the 1988 sample. Thus, total expenses
on wages and salaries averaged $188,890 for the 1986
sample, $283,449 for the 1987 sample, and $249,441
for the 1988 sample (Table 2).

Production supplies. Expenses for production
supplies include plants and seeds, containers,
production heat, peat and soil, fertilizer and lime,
pesticides and chemicals, packing and shipping
materials, and other production supplies. Expenses
for supplies for the 1986 sample averaged $213,177,
for the 1987 sample $260,403, and for the 1988
sample $279,007.

Other production costs. Other production costs
are facility repairs/maintenance and equipment
operating costs. For the 1986 sample they averaged
$29,772, for the 1987 sample $42,660, and for the
1988 sample $39,034.

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 $74,333 for the 1986 sample,
$104,082 for the 1987 sample, and $71,462 for the
1988 sample.

Total cash costs. Total cash costs, including all
items mentioned above, averaged $506,172 for the
1986 sample, $690,594 for the 1987 sample, and
$638,944 for the 1988 sample.

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 $71,349 for the 1986 sample, $109,261
for the 1987 sample, and $85,984 for the 1988
sample.








Flowering Plants


Table 2--Costs of Production, flowering plant nurseries in Florida, 1986, 1987, 1988.

1986 sample 1987 sample 1988 sample
. ..----------------------------------------------------------------------


LABOR TOTAL . . .... .. $188,890 32.7%
SUPPLIES TOTAL. . . ... $213,177 36.9%

OTHER PRODUCTION COSTS TOTAL. .. .$29,772 5.2%
ADMINISTRATIVE & OVERHEAD COSTS TOTAL $74,333 12.9%
TOTAL CASH COSTS. . . ... 506,172 87.6%
TOTAL NON-CASH COSTS. . ... $71,349 12.4%
TOTAL ALL COSTS . .... $577,521 100%


$283,449 35.4X $249,441 34.4X

$260,403 32.6% $279,007 38.5%
$42,660 5.3% $39,034 5.4%


$104,082 13.0%
=max====== =====
$690,594 86.3%
$109,261 13.7%
$799,855 100%


$71,462 9.9%
$638,944 88.1%
$85,984 11.9%
$724,928 100%


See Appendix Tables 6 and 7 for more detail.


Total all costs. The sum of all cash costs and
non-cash allowances averaged $577,521 for the 1986
sample, $799,855 for the 1987 sample, and $724,928
for the 1988 sample.



Costs as a Percent of the Total Cost (Appendix
Table 7).
While dollar expenditures show the magnitude of
expenses for various cost categories, it may be more
meaningful to compare costs in terms of percentages
of the total budget, so that the effects of sampled
firm size are not confounded. Distribution of costs
of production by category are shown graphically for
the average of the 1988 sample in Figure 12.

Salaries and wages. Salaries and wages (includes
operator) as a percentage of total costs averaged
32.7 percent of total costs for the 1986 sample, 35.4
percent for the 1987 sample, and 34.4 percent for
the 1988 sample (Table 2). The 1987 and 1988
samples showed a somewhat higher percentage of
costs in employee's wages and benefits (31.3 and 30.2
percent) than the 1986 sample (26.8 percent).

Production supplies. Average costs for the 1986
sample were 36.9 percent of total costs, for the 1987
sample 32.6 percent, and for the 1988 sample 38.5
percent. The greatest share of expenses for this
category was "plants and seeds" (18.7, 14.6, and 17.5
percent). Expenses for growing containers were 4.7,
5.1 and 6.0 percent. Expenses on pesticides and


other chemicals showed the largest proportional
variation, being 1.5 percent for the 1986 sample and
3.2 percent for the 1988 sample.

Other production costs. Other production costs
averaged 5.2 percent for the 1986 sample, 5.3 percent
for the 1987 sample, and 5.4 percent for the 1988
sample.

Administrative and overhead. Overhead costs
averaged 12.9 percent of total costs for the 1986
sample, 13.0 percent for the 1987 sample, and 9.9
percent for the 1988 sample.

Total cash costs. Total cash costs as a percent of
all costs for container nurseries were very close for
all three sample years: 87.6, 86.3 and 88.1 percent,
respectively.

Non-cash costs. Non-cash costs ("depreciation",
"interest on capital", etc.) averaged 12.4 percent of
total costs for the 1986 sample, 13.7 percent for the
1987 sample, and 11.9 percent for the 1988 sample.
The largest share of non-cash costs was due to
interest on capital: 7.3, 8.8 and 7.3 percent
respectively. Depreciation on equipment, buildings,
and other property improvements ranged from 4.5
percent to 5.1 percent.








Flowering Plants


Table 2--Costs of Production, flowering plant nurseries in Florida, 1986, 1987, 1988.

1986 sample 1987 sample 1988 sample
. ..----------------------------------------------------------------------


LABOR TOTAL . . .... .. $188,890 32.7%
SUPPLIES TOTAL. . . ... $213,177 36.9%

OTHER PRODUCTION COSTS TOTAL. .. .$29,772 5.2%
ADMINISTRATIVE & OVERHEAD COSTS TOTAL $74,333 12.9%
TOTAL CASH COSTS. . . ... 506,172 87.6%
TOTAL NON-CASH COSTS. . ... $71,349 12.4%
TOTAL ALL COSTS . .... $577,521 100%


$283,449 35.4X $249,441 34.4X

$260,403 32.6% $279,007 38.5%
$42,660 5.3% $39,034 5.4%


$104,082 13.0%
=max====== =====
$690,594 86.3%
$109,261 13.7%
$799,855 100%


$71,462 9.9%
$638,944 88.1%
$85,984 11.9%
$724,928 100%


See Appendix Tables 6 and 7 for more detail.


Total all costs. The sum of all cash costs and
non-cash allowances averaged $577,521 for the 1986
sample, $799,855 for the 1987 sample, and $724,928
for the 1988 sample.



Costs as a Percent of the Total Cost (Appendix
Table 7).
While dollar expenditures show the magnitude of
expenses for various cost categories, it may be more
meaningful to compare costs in terms of percentages
of the total budget, so that the effects of sampled
firm size are not confounded. Distribution of costs
of production by category are shown graphically for
the average of the 1988 sample in Figure 12.

Salaries and wages. Salaries and wages (includes
operator) as a percentage of total costs averaged
32.7 percent of total costs for the 1986 sample, 35.4
percent for the 1987 sample, and 34.4 percent for
the 1988 sample (Table 2). The 1987 and 1988
samples showed a somewhat higher percentage of
costs in employee's wages and benefits (31.3 and 30.2
percent) than the 1986 sample (26.8 percent).

Production supplies. Average costs for the 1986
sample were 36.9 percent of total costs, for the 1987
sample 32.6 percent, and for the 1988 sample 38.5
percent. The greatest share of expenses for this
category was "plants and seeds" (18.7, 14.6, and 17.5
percent). Expenses for growing containers were 4.7,
5.1 and 6.0 percent. Expenses on pesticides and


other chemicals showed the largest proportional
variation, being 1.5 percent for the 1986 sample and
3.2 percent for the 1988 sample.

Other production costs. Other production costs
averaged 5.2 percent for the 1986 sample, 5.3 percent
for the 1987 sample, and 5.4 percent for the 1988
sample.

Administrative and overhead. Overhead costs
averaged 12.9 percent of total costs for the 1986
sample, 13.0 percent for the 1987 sample, and 9.9
percent for the 1988 sample.

Total cash costs. Total cash costs as a percent of
all costs for container nurseries were very close for
all three sample years: 87.6, 86.3 and 88.1 percent,
respectively.

Non-cash costs. Non-cash costs ("depreciation",
"interest on capital", etc.) averaged 12.4 percent of
total costs for the 1986 sample, 13.7 percent for the
1987 sample, and 11.9 percent for the 1988 sample.
The largest share of non-cash costs was due to
interest on capital: 7.3, 8.8 and 7.3 percent
respectively. Depreciation on equipment, buildings,
and other property improvements ranged from 4.5
percent to 5.1 percent.








Flowering Plants


Table 2--Costs of Production, flowering plant nurseries in Florida, 1986, 1987, 1988.

1986 sample 1987 sample 1988 sample
. ..----------------------------------------------------------------------


LABOR TOTAL . . .... .. $188,890 32.7%
SUPPLIES TOTAL. . . ... $213,177 36.9%

OTHER PRODUCTION COSTS TOTAL. .. .$29,772 5.2%
ADMINISTRATIVE & OVERHEAD COSTS TOTAL $74,333 12.9%
TOTAL CASH COSTS. . . ... 506,172 87.6%
TOTAL NON-CASH COSTS. . ... $71,349 12.4%
TOTAL ALL COSTS . .... $577,521 100%


$283,449 35.4X $249,441 34.4X

$260,403 32.6% $279,007 38.5%
$42,660 5.3% $39,034 5.4%


$104,082 13.0%
=max====== =====
$690,594 86.3%
$109,261 13.7%
$799,855 100%


$71,462 9.9%
$638,944 88.1%
$85,984 11.9%
$724,928 100%


See Appendix Tables 6 and 7 for more detail.


Total all costs. The sum of all cash costs and
non-cash allowances averaged $577,521 for the 1986
sample, $799,855 for the 1987 sample, and $724,928
for the 1988 sample.



Costs as a Percent of the Total Cost (Appendix
Table 7).
While dollar expenditures show the magnitude of
expenses for various cost categories, it may be more
meaningful to compare costs in terms of percentages
of the total budget, so that the effects of sampled
firm size are not confounded. Distribution of costs
of production by category are shown graphically for
the average of the 1988 sample in Figure 12.

Salaries and wages. Salaries and wages (includes
operator) as a percentage of total costs averaged
32.7 percent of total costs for the 1986 sample, 35.4
percent for the 1987 sample, and 34.4 percent for
the 1988 sample (Table 2). The 1987 and 1988
samples showed a somewhat higher percentage of
costs in employee's wages and benefits (31.3 and 30.2
percent) than the 1986 sample (26.8 percent).

Production supplies. Average costs for the 1986
sample were 36.9 percent of total costs, for the 1987
sample 32.6 percent, and for the 1988 sample 38.5
percent. The greatest share of expenses for this
category was "plants and seeds" (18.7, 14.6, and 17.5
percent). Expenses for growing containers were 4.7,
5.1 and 6.0 percent. Expenses on pesticides and


other chemicals showed the largest proportional
variation, being 1.5 percent for the 1986 sample and
3.2 percent for the 1988 sample.

Other production costs. Other production costs
averaged 5.2 percent for the 1986 sample, 5.3 percent
for the 1987 sample, and 5.4 percent for the 1988
sample.

Administrative and overhead. Overhead costs
averaged 12.9 percent of total costs for the 1986
sample, 13.0 percent for the 1987 sample, and 9.9
percent for the 1988 sample.

Total cash costs. Total cash costs as a percent of
all costs for container nurseries were very close for
all three sample years: 87.6, 86.3 and 88.1 percent,
respectively.

Non-cash costs. Non-cash costs ("depreciation",
"interest on capital", etc.) averaged 12.4 percent of
total costs for the 1986 sample, 13.7 percent for the
1987 sample, and 11.9 percent for the 1988 sample.
The largest share of non-cash costs was due to
interest on capital: 7.3, 8.8 and 7.3 percent
respectively. Depreciation on equipment, buildings,
and other property improvements ranged from 4.5
percent to 5.1 percent.








Flowering Plants


Table 2--Costs of Production, flowering plant nurseries in Florida, 1986, 1987, 1988.

1986 sample 1987 sample 1988 sample
. ..----------------------------------------------------------------------


LABOR TOTAL . . .... .. $188,890 32.7%
SUPPLIES TOTAL. . . ... $213,177 36.9%

OTHER PRODUCTION COSTS TOTAL. .. .$29,772 5.2%
ADMINISTRATIVE & OVERHEAD COSTS TOTAL $74,333 12.9%
TOTAL CASH COSTS. . . ... 506,172 87.6%
TOTAL NON-CASH COSTS. . ... $71,349 12.4%
TOTAL ALL COSTS . .... $577,521 100%


$283,449 35.4X $249,441 34.4X

$260,403 32.6% $279,007 38.5%
$42,660 5.3% $39,034 5.4%


$104,082 13.0%
=max====== =====
$690,594 86.3%
$109,261 13.7%
$799,855 100%


$71,462 9.9%
$638,944 88.1%
$85,984 11.9%
$724,928 100%


See Appendix Tables 6 and 7 for more detail.


Total all costs. The sum of all cash costs and
non-cash allowances averaged $577,521 for the 1986
sample, $799,855 for the 1987 sample, and $724,928
for the 1988 sample.



Costs as a Percent of the Total Cost (Appendix
Table 7).
While dollar expenditures show the magnitude of
expenses for various cost categories, it may be more
meaningful to compare costs in terms of percentages
of the total budget, so that the effects of sampled
firm size are not confounded. Distribution of costs
of production by category are shown graphically for
the average of the 1988 sample in Figure 12.

Salaries and wages. Salaries and wages (includes
operator) as a percentage of total costs averaged
32.7 percent of total costs for the 1986 sample, 35.4
percent for the 1987 sample, and 34.4 percent for
the 1988 sample (Table 2). The 1987 and 1988
samples showed a somewhat higher percentage of
costs in employee's wages and benefits (31.3 and 30.2
percent) than the 1986 sample (26.8 percent).

Production supplies. Average costs for the 1986
sample were 36.9 percent of total costs, for the 1987
sample 32.6 percent, and for the 1988 sample 38.5
percent. The greatest share of expenses for this
category was "plants and seeds" (18.7, 14.6, and 17.5
percent). Expenses for growing containers were 4.7,
5.1 and 6.0 percent. Expenses on pesticides and


other chemicals showed the largest proportional
variation, being 1.5 percent for the 1986 sample and
3.2 percent for the 1988 sample.

Other production costs. Other production costs
averaged 5.2 percent for the 1986 sample, 5.3 percent
for the 1987 sample, and 5.4 percent for the 1988
sample.

Administrative and overhead. Overhead costs
averaged 12.9 percent of total costs for the 1986
sample, 13.0 percent for the 1987 sample, and 9.9
percent for the 1988 sample.

Total cash costs. Total cash costs as a percent of
all costs for container nurseries were very close for
all three sample years: 87.6, 86.3 and 88.1 percent,
respectively.

Non-cash costs. Non-cash costs ("depreciation",
"interest on capital", etc.) averaged 12.4 percent of
total costs for the 1986 sample, 13.7 percent for the
1987 sample, and 11.9 percent for the 1988 sample.
The largest share of non-cash costs was due to
interest on capital: 7.3, 8.8 and 7.3 percent
respectively. Depreciation on equipment, buildings,
and other property improvements ranged from 4.5
percent to 5.1 percent.








Flowering Plants


Table 2--Costs of Production, flowering plant nurseries in Florida, 1986, 1987, 1988.

1986 sample 1987 sample 1988 sample
. ..----------------------------------------------------------------------


LABOR TOTAL . . .... .. $188,890 32.7%
SUPPLIES TOTAL. . . ... $213,177 36.9%

OTHER PRODUCTION COSTS TOTAL. .. .$29,772 5.2%
ADMINISTRATIVE & OVERHEAD COSTS TOTAL $74,333 12.9%
TOTAL CASH COSTS. . . ... 506,172 87.6%
TOTAL NON-CASH COSTS. . ... $71,349 12.4%
TOTAL ALL COSTS . .... $577,521 100%


$283,449 35.4X $249,441 34.4X

$260,403 32.6% $279,007 38.5%
$42,660 5.3% $39,034 5.4%


$104,082 13.0%
=max====== =====
$690,594 86.3%
$109,261 13.7%
$799,855 100%


$71,462 9.9%
$638,944 88.1%
$85,984 11.9%
$724,928 100%


See Appendix Tables 6 and 7 for more detail.


Total all costs. The sum of all cash costs and
non-cash allowances averaged $577,521 for the 1986
sample, $799,855 for the 1987 sample, and $724,928
for the 1988 sample.



Costs as a Percent of the Total Cost (Appendix
Table 7).
While dollar expenditures show the magnitude of
expenses for various cost categories, it may be more
meaningful to compare costs in terms of percentages
of the total budget, so that the effects of sampled
firm size are not confounded. Distribution of costs
of production by category are shown graphically for
the average of the 1988 sample in Figure 12.

Salaries and wages. Salaries and wages (includes
operator) as a percentage of total costs averaged
32.7 percent of total costs for the 1986 sample, 35.4
percent for the 1987 sample, and 34.4 percent for
the 1988 sample (Table 2). The 1987 and 1988
samples showed a somewhat higher percentage of
costs in employee's wages and benefits (31.3 and 30.2
percent) than the 1986 sample (26.8 percent).

Production supplies. Average costs for the 1986
sample were 36.9 percent of total costs, for the 1987
sample 32.6 percent, and for the 1988 sample 38.5
percent. The greatest share of expenses for this
category was "plants and seeds" (18.7, 14.6, and 17.5
percent). Expenses for growing containers were 4.7,
5.1 and 6.0 percent. Expenses on pesticides and


other chemicals showed the largest proportional
variation, being 1.5 percent for the 1986 sample and
3.2 percent for the 1988 sample.

Other production costs. Other production costs
averaged 5.2 percent for the 1986 sample, 5.3 percent
for the 1987 sample, and 5.4 percent for the 1988
sample.

Administrative and overhead. Overhead costs
averaged 12.9 percent of total costs for the 1986
sample, 13.0 percent for the 1987 sample, and 9.9
percent for the 1988 sample.

Total cash costs. Total cash costs as a percent of
all costs for container nurseries were very close for
all three sample years: 87.6, 86.3 and 88.1 percent,
respectively.

Non-cash costs. Non-cash costs ("depreciation",
"interest on capital", etc.) averaged 12.4 percent of
total costs for the 1986 sample, 13.7 percent for the
1987 sample, and 11.9 percent for the 1988 sample.
The largest share of non-cash costs was due to
interest on capital: 7.3, 8.8 and 7.3 percent
respectively. Depreciation on equipment, buildings,
and other property improvements ranged from 4.5
percent to 5.1 percent.








Flowering Plants


Table 2--Costs of Production, flowering plant nurseries in Florida, 1986, 1987, 1988.

1986 sample 1987 sample 1988 sample
. ..----------------------------------------------------------------------


LABOR TOTAL . . .... .. $188,890 32.7%
SUPPLIES TOTAL. . . ... $213,177 36.9%

OTHER PRODUCTION COSTS TOTAL. .. .$29,772 5.2%
ADMINISTRATIVE & OVERHEAD COSTS TOTAL $74,333 12.9%
TOTAL CASH COSTS. . . ... 506,172 87.6%
TOTAL NON-CASH COSTS. . ... $71,349 12.4%
TOTAL ALL COSTS . .... $577,521 100%


$283,449 35.4X $249,441 34.4X

$260,403 32.6% $279,007 38.5%
$42,660 5.3% $39,034 5.4%


$104,082 13.0%
=max====== =====
$690,594 86.3%
$109,261 13.7%
$799,855 100%


$71,462 9.9%
$638,944 88.1%
$85,984 11.9%
$724,928 100%


See Appendix Tables 6 and 7 for more detail.


Total all costs. The sum of all cash costs and
non-cash allowances averaged $577,521 for the 1986
sample, $799,855 for the 1987 sample, and $724,928
for the 1988 sample.



Costs as a Percent of the Total Cost (Appendix
Table 7).
While dollar expenditures show the magnitude of
expenses for various cost categories, it may be more
meaningful to compare costs in terms of percentages
of the total budget, so that the effects of sampled
firm size are not confounded. Distribution of costs
of production by category are shown graphically for
the average of the 1988 sample in Figure 12.

Salaries and wages. Salaries and wages (includes
operator) as a percentage of total costs averaged
32.7 percent of total costs for the 1986 sample, 35.4
percent for the 1987 sample, and 34.4 percent for
the 1988 sample (Table 2). The 1987 and 1988
samples showed a somewhat higher percentage of
costs in employee's wages and benefits (31.3 and 30.2
percent) than the 1986 sample (26.8 percent).

Production supplies. Average costs for the 1986
sample were 36.9 percent of total costs, for the 1987
sample 32.6 percent, and for the 1988 sample 38.5
percent. The greatest share of expenses for this
category was "plants and seeds" (18.7, 14.6, and 17.5
percent). Expenses for growing containers were 4.7,
5.1 and 6.0 percent. Expenses on pesticides and


other chemicals showed the largest proportional
variation, being 1.5 percent for the 1986 sample and
3.2 percent for the 1988 sample.

Other production costs. Other production costs
averaged 5.2 percent for the 1986 sample, 5.3 percent
for the 1987 sample, and 5.4 percent for the 1988
sample.

Administrative and overhead. Overhead costs
averaged 12.9 percent of total costs for the 1986
sample, 13.0 percent for the 1987 sample, and 9.9
percent for the 1988 sample.

Total cash costs. Total cash costs as a percent of
all costs for container nurseries were very close for
all three sample years: 87.6, 86.3 and 88.1 percent,
respectively.

Non-cash costs. Non-cash costs ("depreciation",
"interest on capital", etc.) averaged 12.4 percent of
total costs for the 1986 sample, 13.7 percent for the
1987 sample, and 11.9 percent for the 1988 sample.
The largest share of non-cash costs was due to
interest on capital: 7.3, 8.8 and 7.3 percent
respectively. Depreciation on equipment, buildings,
and other property improvements ranged from 4.5
percent to 5.1 percent.








Flowering Plants


Table 2--Costs of Production, flowering plant nurseries in Florida, 1986, 1987, 1988.

1986 sample 1987 sample 1988 sample
. ..----------------------------------------------------------------------


LABOR TOTAL . . .... .. $188,890 32.7%
SUPPLIES TOTAL. . . ... $213,177 36.9%

OTHER PRODUCTION COSTS TOTAL. .. .$29,772 5.2%
ADMINISTRATIVE & OVERHEAD COSTS TOTAL $74,333 12.9%
TOTAL CASH COSTS. . . ... 506,172 87.6%
TOTAL NON-CASH COSTS. . ... $71,349 12.4%
TOTAL ALL COSTS . .... $577,521 100%


$283,449 35.4X $249,441 34.4X

$260,403 32.6% $279,007 38.5%
$42,660 5.3% $39,034 5.4%


$104,082 13.0%
=max====== =====
$690,594 86.3%
$109,261 13.7%
$799,855 100%


$71,462 9.9%
$638,944 88.1%
$85,984 11.9%
$724,928 100%


See Appendix Tables 6 and 7 for more detail.


Total all costs. The sum of all cash costs and
non-cash allowances averaged $577,521 for the 1986
sample, $799,855 for the 1987 sample, and $724,928
for the 1988 sample.



Costs as a Percent of the Total Cost (Appendix
Table 7).
While dollar expenditures show the magnitude of
expenses for various cost categories, it may be more
meaningful to compare costs in terms of percentages
of the total budget, so that the effects of sampled
firm size are not confounded. Distribution of costs
of production by category are shown graphically for
the average of the 1988 sample in Figure 12.

Salaries and wages. Salaries and wages (includes
operator) as a percentage of total costs averaged
32.7 percent of total costs for the 1986 sample, 35.4
percent for the 1987 sample, and 34.4 percent for
the 1988 sample (Table 2). The 1987 and 1988
samples showed a somewhat higher percentage of
costs in employee's wages and benefits (31.3 and 30.2
percent) than the 1986 sample (26.8 percent).

Production supplies. Average costs for the 1986
sample were 36.9 percent of total costs, for the 1987
sample 32.6 percent, and for the 1988 sample 38.5
percent. The greatest share of expenses for this
category was "plants and seeds" (18.7, 14.6, and 17.5
percent). Expenses for growing containers were 4.7,
5.1 and 6.0 percent. Expenses on pesticides and


other chemicals showed the largest proportional
variation, being 1.5 percent for the 1986 sample and
3.2 percent for the 1988 sample.

Other production costs. Other production costs
averaged 5.2 percent for the 1986 sample, 5.3 percent
for the 1987 sample, and 5.4 percent for the 1988
sample.

Administrative and overhead. Overhead costs
averaged 12.9 percent of total costs for the 1986
sample, 13.0 percent for the 1987 sample, and 9.9
percent for the 1988 sample.

Total cash costs. Total cash costs as a percent of
all costs for container nurseries were very close for
all three sample years: 87.6, 86.3 and 88.1 percent,
respectively.

Non-cash costs. Non-cash costs ("depreciation",
"interest on capital", etc.) averaged 12.4 percent of
total costs for the 1986 sample, 13.7 percent for the
1987 sample, and 11.9 percent for the 1988 sample.
The largest share of non-cash costs was due to
interest on capital: 7.3, 8.8 and 7.3 percent
respectively. Depreciation on equipment, buildings,
and other property improvements ranged from 4.5
percent to 5.1 percent.






Flo'.'ering Plants


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


Costs Per Square Foot of Bed and Bench Space
(Appendix Table 8).
These figures were obtained by dividing each of
the dollar cost figures in Appendix Table 6 by the
square feet of bed and bench space shown in
Appendix Table 1. This is growing area only, not
including offices, packing areas, drives, roadways, and
ditches, etc. Costs per square foot of bed and bench
space averaged $6.01 for the 1986 sample, $6.12 for
the 1987 sample, and $6.24 for the 1988 sample
(Figure 13). Highest rates of cost per square foot
averaged $11.18, and lowest rates averaged $4.44
(Figure 13).


Cash costs per square foot (excluding
depreciation, interest, etc.) averaged $5.26 for the
1986 sample, $5.28 for the 1987 sample, and $5.50
for the 1988 sample.

Cost Per Square Foot of Propagating and Finishing
Space (Appendix Table 9).
Costs per square foot of propagating and finishing
space is the most appropriate measure for estimating
individual plant growing costs or for comparing cost
efficiency between nurseries. These costs were
obtained by dividing the dollar amounts in Appendix
Table 6 by the square feet of propagating and
finishing space from Appendix Table 1. The 1986
and 1987 samples both averaged $6.24, and the 1988
sample averaged $6.34 (Figure 14). Highest rates
averaged $11.62 per square foot and lowest rates
averaged $4.47 (Figure 14).

For a given nursery operation, lower costs per
square foot are desirable. Problems that increase
costs per square foot include inefficient labor
management, insufficient investment in labor saving
capital items, destruction or theft of supplies and
plants, and poor purchasing practices.


Figure 12
Distribution of Costs of Production
Flowering Plant Nurseries, 1988



Non-cash costs
11 .9%o
Labor Admin. & overhead
34.4% 9.9%

Other prod. costs
5.4%


Supp I ies
38.5%






Flo'.'ering Plants


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


Costs Per Square Foot of Bed and Bench Space
(Appendix Table 8).
These figures were obtained by dividing each of
the dollar cost figures in Appendix Table 6 by the
square feet of bed and bench space shown in
Appendix Table 1. This is growing area only, not
including offices, packing areas, drives, roadways, and
ditches, etc. Costs per square foot of bed and bench
space averaged $6.01 for the 1986 sample, $6.12 for
the 1987 sample, and $6.24 for the 1988 sample
(Figure 13). Highest rates of cost per square foot
averaged $11.18, and lowest rates averaged $4.44
(Figure 13).


Cash costs per square foot (excluding
depreciation, interest, etc.) averaged $5.26 for the
1986 sample, $5.28 for the 1987 sample, and $5.50
for the 1988 sample.

Cost Per Square Foot of Propagating and Finishing
Space (Appendix Table 9).
Costs per square foot of propagating and finishing
space is the most appropriate measure for estimating
individual plant growing costs or for comparing cost
efficiency between nurseries. These costs were
obtained by dividing the dollar amounts in Appendix
Table 6 by the square feet of propagating and
finishing space from Appendix Table 1. The 1986
and 1987 samples both averaged $6.24, and the 1988
sample averaged $6.34 (Figure 14). Highest rates
averaged $11.62 per square foot and lowest rates
averaged $4.47 (Figure 14).

For a given nursery operation, lower costs per
square foot are desirable. Problems that increase
costs per square foot include inefficient labor
management, insufficient investment in labor saving
capital items, destruction or theft of supplies and
plants, and poor purchasing practices.


Figure 12
Distribution of Costs of Production
Flowering Plant Nurseries, 1988



Non-cash costs
11 .9%o
Labor Admin. & overhead
34.4% 9.9%

Other prod. costs
5.4%


Supp I ies
38.5%






Flo'.'ering Plants


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


Costs Per Square Foot of Bed and Bench Space
(Appendix Table 8).
These figures were obtained by dividing each of
the dollar cost figures in Appendix Table 6 by the
square feet of bed and bench space shown in
Appendix Table 1. This is growing area only, not
including offices, packing areas, drives, roadways, and
ditches, etc. Costs per square foot of bed and bench
space averaged $6.01 for the 1986 sample, $6.12 for
the 1987 sample, and $6.24 for the 1988 sample
(Figure 13). Highest rates of cost per square foot
averaged $11.18, and lowest rates averaged $4.44
(Figure 13).


Cash costs per square foot (excluding
depreciation, interest, etc.) averaged $5.26 for the
1986 sample, $5.28 for the 1987 sample, and $5.50
for the 1988 sample.

Cost Per Square Foot of Propagating and Finishing
Space (Appendix Table 9).
Costs per square foot of propagating and finishing
space is the most appropriate measure for estimating
individual plant growing costs or for comparing cost
efficiency between nurseries. These costs were
obtained by dividing the dollar amounts in Appendix
Table 6 by the square feet of propagating and
finishing space from Appendix Table 1. The 1986
and 1987 samples both averaged $6.24, and the 1988
sample averaged $6.34 (Figure 14). Highest rates
averaged $11.62 per square foot and lowest rates
averaged $4.47 (Figure 14).

For a given nursery operation, lower costs per
square foot are desirable. Problems that increase
costs per square foot include inefficient labor
management, insufficient investment in labor saving
capital items, destruction or theft of supplies and
plants, and poor purchasing practices.


Figure 12
Distribution of Costs of Production
Flowering Plant Nurseries, 1988



Non-cash costs
11 .9%o
Labor Admin. & overhead
34.4% 9.9%

Other prod. costs
5.4%


Supp I ies
38.5%








Flowering Plants


Figure 13

Costs/Square Foot of Bed & Bench Space

Flowering Plant Nurseries, 1986, '87, '88


Do lars/Sq.Ft.
12


10 41
X -----------N- ----N ----- N--t R--
10 .................................................................................................................


8 ...................................................... .... ....................... Highest Rates

Lowest Rates

\ NNon-cash Costs

4 .................... ...... ...... ............... Cash Co sts


2 --------. --.......................- -- --..........................--- --



1986 1987 1988




Figure 14

Costs/Square Foot of Prop. & Fin. Space

Flowering Plant Nurseries, 1986, '87, '88


Do I lars/Sq. Ft.


1986 1987 1988


12,00


10.00


8.00


6.00


4.00


2.00


0.00


-------





.00 -4--Highest Pat"es
.................................................................


-C Highest Rates

SLowest Rates

SNon-cash costs

Cash Costs


4.00Cs ---Costs


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


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


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








Flowering Plants


Costs Per Dollar's Worth of Production (Appendix
Table 10).
Costs per dollar value of production (sales
adjusted for changes in the value of plant inventory
during the year) is a direct measure of long-term
profitability. This is calculated by dividing the dollar
costs (Appendix Table 6) by the value of own plants
sold adjusted for change in plant inventory value
(Appendix Table 1). So, a $1.00 cost per dollar
value of production represents the breakeven cost
level. Total costs per dollar value of production for
flowering plant nurseries averaged 99.0 cents for the
1986 sample, 99.3 cents for the 1987 sample, and
99.1 cents for the 1988 sample (Figure 15). Highest
rates of costs per dollar value of production averaged
$1.14 and lowest rates $.94 (Figure 15).


Cash Costs Per Dollar of Sales (Appendix Table 11).
Profitability is indicated by costs per dollar of
sales adjusted for changes in inventory value,
however, 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 91
cents for the 1986 sample, 86 cents for the 1987
sample, and 88 cents for the 1988 sample (Figure
16). Highest cost firms averaged 96 cents per dollar
of sales, and lowest cost firms had cash costs of 82
cents per dollar of sales (Figure 16).

In general, lower costs per dollar of sales are
desirable. Rising costs per dollar of sales are very
common during periods of rapid expansion, since
extra costs of a larger operation are incurred before
the accompanying extra sales. During inflationary
times, failure of prices to keep up with cost increases
will also cause higher costs per dollar of sales.


Figure 15
Costs Per Dol lar 's Worth of Production
Flowering Plant Nurseries, 1986, '87, '88

Do I lars/Do lar
1.20
I
Breakeven Cost


0.80 ...................... ...... ...... ...................... Highest Rates

Lowest Rates
0 60 ...............
Non-Cash Costs
0.40 ..................... .. Cash Costs

0 20 ... .

0.00
1996 1987 1968








Flowering Plants


Costs Per Dollar's Worth of Production (Appendix
Table 10).
Costs per dollar value of production (sales
adjusted for changes in the value of plant inventory
during the year) is a direct measure of long-term
profitability. This is calculated by dividing the dollar
costs (Appendix Table 6) by the value of own plants
sold adjusted for change in plant inventory value
(Appendix Table 1). So, a $1.00 cost per dollar
value of production represents the breakeven cost
level. Total costs per dollar value of production for
flowering plant nurseries averaged 99.0 cents for the
1986 sample, 99.3 cents for the 1987 sample, and
99.1 cents for the 1988 sample (Figure 15). Highest
rates of costs per dollar value of production averaged
$1.14 and lowest rates $.94 (Figure 15).


Cash Costs Per Dollar of Sales (Appendix Table 11).
Profitability is indicated by costs per dollar of
sales adjusted for changes in inventory value,
however, 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 91
cents for the 1986 sample, 86 cents for the 1987
sample, and 88 cents for the 1988 sample (Figure
16). Highest cost firms averaged 96 cents per dollar
of sales, and lowest cost firms had cash costs of 82
cents per dollar of sales (Figure 16).

In general, lower costs per dollar of sales are
desirable. Rising costs per dollar of sales are very
common during periods of rapid expansion, since
extra costs of a larger operation are incurred before
the accompanying extra sales. During inflationary
times, failure of prices to keep up with cost increases
will also cause higher costs per dollar of sales.


Figure 15
Costs Per Dol lar 's Worth of Production
Flowering Plant Nurseries, 1986, '87, '88

Do I lars/Do lar
1.20
I
Breakeven Cost


0.80 ...................... ...... ...... ...................... Highest Rates

Lowest Rates
0 60 ...............
Non-Cash Costs
0.40 ..................... .. Cash Costs

0 20 ... .

0.00
1996 1987 1968










Flowering Plants


Figure 16
Cash Costs Per Dol lar 's Worth of Sales
Flowering Plant Nurseries, 1986, '87, '88


Do I lars/Do I lar


Breakeven Cost


- -I


0.6 -----
0 .6 .........................

0 .4 .........................

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

0.0-----


1986 1987 1988


-- Highest Rates
-4- Lowest Rates


Income Summary (Appendix Table 12)
This section provides a condensed operating
statement showing the development of net nursery
income and its allocation between the owner-operator
and money invested in the firms. Figure 17 shows
the distribution of total gain and Table 3 describes
the data used for the figure.


Total Gain
Total gain is the total value produced by the
year's operations, including the sum of plant sales,
changes in plant and supply inventory values, and
miscellaneous income. Increases in inventories of
supplies averaged $24,663 for the 1986 sample, $587
for the 1987 sample, and $6,074 for the 1988 sample.
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 $3,328 for the 1986
sample, $3,060 for the 1987 sample, and $3,748 for
the 1988 sample. Total gain averaged $587,442 for


the 1986 sample, $808,580 for the 1987 sample, and
$739,716 for the 1988 sample.


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 obtain net nursery income. Total
deductions averaged $500,824 for the 1986 sample,
$696,431 for the 1987 sample, and $641,233 for the
1988 sample.

Net nursery income is the total annual return to
the operator and the capital invested in the
operation. Average net nursery income was $86,618
for the 1986 sample, $112,149 for the 1987 sample,
and $98,483 for the 1988 sample.


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

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


. . . . .










Flowering Plants


Figure 16
Cash Costs Per Dol lar 's Worth of Sales
Flowering Plant Nurseries, 1986, '87, '88


Do I lars/Do I lar


Breakeven Cost


- -I


0.6 -----
0 .6 .........................

0 .4 .........................

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

0.0-----


1986 1987 1988


-- Highest Rates
-4- Lowest Rates


Income Summary (Appendix Table 12)
This section provides a condensed operating
statement showing the development of net nursery
income and its allocation between the owner-operator
and money invested in the firms. Figure 17 shows
the distribution of total gain and Table 3 describes
the data used for the figure.


Total Gain
Total gain is the total value produced by the
year's operations, including the sum of plant sales,
changes in plant and supply inventory values, and
miscellaneous income. Increases in inventories of
supplies averaged $24,663 for the 1986 sample, $587
for the 1987 sample, and $6,074 for the 1988 sample.
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 $3,328 for the 1986
sample, $3,060 for the 1987 sample, and $3,748 for
the 1988 sample. Total gain averaged $587,442 for


the 1986 sample, $808,580 for the 1987 sample, and
$739,716 for the 1988 sample.


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 obtain net nursery income. Total
deductions averaged $500,824 for the 1986 sample,
$696,431 for the 1987 sample, and $641,233 for the
1988 sample.

Net nursery income is the total annual return to
the operator and the capital invested in the
operation. Average net nursery income was $86,618
for the 1986 sample, $112,149 for the 1987 sample,
and $98,483 for the 1988 sample.


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

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


. . . . .










Flowering Plants


Figure 16
Cash Costs Per Dol lar 's Worth of Sales
Flowering Plant Nurseries, 1986, '87, '88


Do I lars/Do I lar


Breakeven Cost


- -I


0.6 -----
0 .6 .........................

0 .4 .........................

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

0.0-----


1986 1987 1988


-- Highest Rates
-4- Lowest Rates


Income Summary (Appendix Table 12)
This section provides a condensed operating
statement showing the development of net nursery
income and its allocation between the owner-operator
and money invested in the firms. Figure 17 shows
the distribution of total gain and Table 3 describes
the data used for the figure.


Total Gain
Total gain is the total value produced by the
year's operations, including the sum of plant sales,
changes in plant and supply inventory values, and
miscellaneous income. Increases in inventories of
supplies averaged $24,663 for the 1986 sample, $587
for the 1987 sample, and $6,074 for the 1988 sample.
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 $3,328 for the 1986
sample, $3,060 for the 1987 sample, and $3,748 for
the 1988 sample. Total gain averaged $587,442 for


the 1986 sample, $808,580 for the 1987 sample, and
$739,716 for the 1988 sample.


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 obtain net nursery income. Total
deductions averaged $500,824 for the 1986 sample,
$696,431 for the 1987 sample, and $641,233 for the
1988 sample.

Net nursery income is the total annual return to
the operator and the capital invested in the
operation. Average net nursery income was $86,618
for the 1986 sample, $112,149 for the 1987 sample,
and $98,483 for the 1988 sample.


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

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


. . . . .









Flowering Plants


Table 3--Income Summary, flowering plant nurseries in Florida, 1986, 1987, 1988.

1986 1987 1988
unit sample sample sample

TOTAL GAIN . . ... .. 587,442 808,580 739,716
Total Deductions ........ $. (500,824) (696,431) (641,233)
V:ET NURSERY INCOME . ... 86,618 112,149 98,483
operator's salary or time value. S 34,288 32,852 30,738
E==iS=weE=W=z- R-=lmaz:=]=s WE===R~a== ...
rETURN TO CAPITAL. . .. 52,331 79,296 67,745
Percent. ........... ... % 14.81 13.48 15.35
See Appendix Table 12 for more detail.


Figure 17

Distribution of Total Gain
Flowering Plant Nurseries, 1986, '987 '88


Dollars CthousandsD
1000





600 .......-:-:-:-:-: ..-:-:.-....... ..... P-etur n to Caplt lo I

RetLrn to Operator
...00 ".............. M Expenses


200 ...


Return to Capital

The return to the capital invested is net nursery
income less the operator's salary or time value.
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
$52,331 for the 1986 sample, $79,296 for the 1987
sample, and $67,745 for the 1988 sample (see
Appendix Table 12 for more detail).

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.


I ~86 196~ I~66


1986


1987


19BB










Flowering Plants


For example, this is equivalent to the widely quoted
yields for capital market instruments such as
certificates of deposit, treasury notes, and bonds.
Average value of capital invested for each of the
three years was reported in Table 1. Figure 18
shows that average rate of return on capital was 14.8
percent for the 1986 sample, 13.5 percent for the
1987 sample, and 15.4 percent for smallest. Thus,
for every dollar invested in these flowering plant
nurseries in 1988, there was an average return of
15.4 cents. Highest rates of return on capital
averaged 24.1 percent. Lowest rates were minus .6
percent (Figure 18).

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


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

Cash on hand includes funds in checking
accounts, savings accounts, and money market funds.
Average cash on hand was $11,498 for the 1986
sample, $25,820 for the 1987 sample, and $27,407 for
the 1988 sample. The main function of cash on hand
is to pay for current liabilities. The ratio of cash on
hand to current liabilities averaged .55 for the 1986
sample, 1.09 for the 1987 sample, and .73 for the
1988 sample.

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 $72,508 for the 1986 sample, $102,702, and
$91,753 for the 1988 sample. As a percentage of
annual sales, accounts receivable represented 13
percent, 17 percent, and 13 percent, respectively.


Figure 18

Return to Capital
Flowering Plant Nurseries, 1986, '87., '88

Percentage Profit to Capital Owned
25

20 -........................ .............................................................................................



Highest Rates
Lowest Rates



0 -----

-5
1986 1987 1988










Flowering Plants


For example, this is equivalent to the widely quoted
yields for capital market instruments such as
certificates of deposit, treasury notes, and bonds.
Average value of capital invested for each of the
three years was reported in Table 1. Figure 18
shows that average rate of return on capital was 14.8
percent for the 1986 sample, 13.5 percent for the
1987 sample, and 15.4 percent for smallest. Thus,
for every dollar invested in these flowering plant
nurseries in 1988, there was an average return of
15.4 cents. Highest rates of return on capital
averaged 24.1 percent. Lowest rates were minus .6
percent (Figure 18).

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


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

Cash on hand includes funds in checking
accounts, savings accounts, and money market funds.
Average cash on hand was $11,498 for the 1986
sample, $25,820 for the 1987 sample, and $27,407 for
the 1988 sample. The main function of cash on hand
is to pay for current liabilities. The ratio of cash on
hand to current liabilities averaged .55 for the 1986
sample, 1.09 for the 1987 sample, and .73 for the
1988 sample.

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 $72,508 for the 1986 sample, $102,702, and
$91,753 for the 1988 sample. As a percentage of
annual sales, accounts receivable represented 13
percent, 17 percent, and 13 percent, respectively.


Figure 18

Return to Capital
Flowering Plant Nurseries, 1986, '87., '88

Percentage Profit to Capital Owned
25

20 -........................ .............................................................................................



Highest Rates
Lowest Rates



0 -----

-5
1986 1987 1988










Flowering Plants


For example, this is equivalent to the widely quoted
yields for capital market instruments such as
certificates of deposit, treasury notes, and bonds.
Average value of capital invested for each of the
three years was reported in Table 1. Figure 18
shows that average rate of return on capital was 14.8
percent for the 1986 sample, 13.5 percent for the
1987 sample, and 15.4 percent for smallest. Thus,
for every dollar invested in these flowering plant
nurseries in 1988, there was an average return of
15.4 cents. Highest rates of return on capital
averaged 24.1 percent. Lowest rates were minus .6
percent (Figure 18).

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


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

Cash on hand includes funds in checking
accounts, savings accounts, and money market funds.
Average cash on hand was $11,498 for the 1986
sample, $25,820 for the 1987 sample, and $27,407 for
the 1988 sample. The main function of cash on hand
is to pay for current liabilities. The ratio of cash on
hand to current liabilities averaged .55 for the 1986
sample, 1.09 for the 1987 sample, and .73 for the
1988 sample.

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 $72,508 for the 1986 sample, $102,702, and
$91,753 for the 1988 sample. As a percentage of
annual sales, accounts receivable represented 13
percent, 17 percent, and 13 percent, respectively.


Figure 18

Return to Capital
Flowering Plant Nurseries, 1986, '87., '88

Percentage Profit to Capital Owned
25

20 -........................ .............................................................................................



Highest Rates
Lowest Rates



0 -----

-5
1986 1987 1988










Flowering Plants


For example, this is equivalent to the widely quoted
yields for capital market instruments such as
certificates of deposit, treasury notes, and bonds.
Average value of capital invested for each of the
three years was reported in Table 1. Figure 18
shows that average rate of return on capital was 14.8
percent for the 1986 sample, 13.5 percent for the
1987 sample, and 15.4 percent for smallest. Thus,
for every dollar invested in these flowering plant
nurseries in 1988, there was an average return of
15.4 cents. Highest rates of return on capital
averaged 24.1 percent. Lowest rates were minus .6
percent (Figure 18).

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


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

Cash on hand includes funds in checking
accounts, savings accounts, and money market funds.
Average cash on hand was $11,498 for the 1986
sample, $25,820 for the 1987 sample, and $27,407 for
the 1988 sample. The main function of cash on hand
is to pay for current liabilities. The ratio of cash on
hand to current liabilities averaged .55 for the 1986
sample, 1.09 for the 1987 sample, and .73 for the
1988 sample.

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 $72,508 for the 1986 sample, $102,702, and
$91,753 for the 1988 sample. As a percentage of
annual sales, accounts receivable represented 13
percent, 17 percent, and 13 percent, respectively.


Figure 18

Return to Capital
Flowering Plant Nurseries, 1986, '87., '88

Percentage Profit to Capital Owned
25

20 -........................ .............................................................................................



Highest Rates
Lowest Rates



0 -----

-5
1986 1987 1988









Flowering Plants


Inventory values include growing plants and
supplies, which were presented previously in Table
1. The combined value of inventories averaged
$140,644 for the 1986 sample, $178,243 for the 1987
sample, and $136,261 for the 1988 sample.

Current assets averaged $224,650 for the 1986
sample, $306,766 for the 1987 sample, and $255,420
for the 1988 sample.

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
$287,243 for the 1986 sample, $549,142 for the 1987
sample, and $435,044 for the 1988 sample.
Subtracting accumulated depreciation left a current
value of $128,769 for the 1986 sample, $281,331 for
the 1987 sample, and $185,887 for the 1988 sample.
As a percentage of the original investment, these
current values represented 45 percent for the average


of the 1986 sample, 64 percent for the
and 43 percent for the 1988 sample.


1987 sample,


Total assets. The sum of current and long term
assets gives average total assets of $353,419 for the
1986 sample, $588,097 for the 1987 sample, and
$441,307 for the 1988 sample. These amounts are
the same as reported for "total owned capital" in
Table 1.

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

Current liabilities averaged $20,816 for the 1986
sample, $44,360 for the 1987 sample, and $37,753 for
the 1988 sample. The ratio of cash and accounts
receivable to current liabilities, known as the "quick
ratio", is a standard indicator of liquidity, i.e. the
ability to pay current operating expenses. The quick
ratio averaged 4.0 for the 1986 sample, 6.3 for the
1987 sample, and 3.2 for the 1988 sample.


Figure 19

Assets and Liabilities
Flowering Plant Nurseries, 1986, '87, '88

Dollars CThousands)
700,


600 ................................

500 ...................................


SCLrrent Assets
S Long Term Asets
CI I rrent LlbDI 1ltieS
I Long Term LIablI.
SNet Worth


1985 1988 1987


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


1986


1987


1988









Flowering Plants


Inventory values include growing plants and
supplies, which were presented previously in Table
1. The combined value of inventories averaged
$140,644 for the 1986 sample, $178,243 for the 1987
sample, and $136,261 for the 1988 sample.

Current assets averaged $224,650 for the 1986
sample, $306,766 for the 1987 sample, and $255,420
for the 1988 sample.

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
$287,243 for the 1986 sample, $549,142 for the 1987
sample, and $435,044 for the 1988 sample.
Subtracting accumulated depreciation left a current
value of $128,769 for the 1986 sample, $281,331 for
the 1987 sample, and $185,887 for the 1988 sample.
As a percentage of the original investment, these
current values represented 45 percent for the average


of the 1986 sample, 64 percent for the
and 43 percent for the 1988 sample.


1987 sample,


Total assets. The sum of current and long term
assets gives average total assets of $353,419 for the
1986 sample, $588,097 for the 1987 sample, and
$441,307 for the 1988 sample. These amounts are
the same as reported for "total owned capital" in
Table 1.

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

Current liabilities averaged $20,816 for the 1986
sample, $44,360 for the 1987 sample, and $37,753 for
the 1988 sample. The ratio of cash and accounts
receivable to current liabilities, known as the "quick
ratio", is a standard indicator of liquidity, i.e. the
ability to pay current operating expenses. The quick
ratio averaged 4.0 for the 1986 sample, 6.3 for the
1987 sample, and 3.2 for the 1988 sample.


Figure 19

Assets and Liabilities
Flowering Plant Nurseries, 1986, '87, '88

Dollars CThousands)
700,


600 ................................

500 ...................................


SCLrrent Assets
S Long Term Asets
CI I rrent LlbDI 1ltieS
I Long Term LIablI.
SNet Worth


1985 1988 1987


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


1986


1987


1988









Flowering Plants


Inventory values include growing plants and
supplies, which were presented previously in Table
1. The combined value of inventories averaged
$140,644 for the 1986 sample, $178,243 for the 1987
sample, and $136,261 for the 1988 sample.

Current assets averaged $224,650 for the 1986
sample, $306,766 for the 1987 sample, and $255,420
for the 1988 sample.

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
$287,243 for the 1986 sample, $549,142 for the 1987
sample, and $435,044 for the 1988 sample.
Subtracting accumulated depreciation left a current
value of $128,769 for the 1986 sample, $281,331 for
the 1987 sample, and $185,887 for the 1988 sample.
As a percentage of the original investment, these
current values represented 45 percent for the average


of the 1986 sample, 64 percent for the
and 43 percent for the 1988 sample.


1987 sample,


Total assets. The sum of current and long term
assets gives average total assets of $353,419 for the
1986 sample, $588,097 for the 1987 sample, and
$441,307 for the 1988 sample. These amounts are
the same as reported for "total owned capital" in
Table 1.

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

Current liabilities averaged $20,816 for the 1986
sample, $44,360 for the 1987 sample, and $37,753 for
the 1988 sample. The ratio of cash and accounts
receivable to current liabilities, known as the "quick
ratio", is a standard indicator of liquidity, i.e. the
ability to pay current operating expenses. The quick
ratio averaged 4.0 for the 1986 sample, 6.3 for the
1987 sample, and 3.2 for the 1988 sample.


Figure 19

Assets and Liabilities
Flowering Plant Nurseries, 1986, '87, '88

Dollars CThousands)
700,


600 ................................

500 ...................................


SCLrrent Assets
S Long Term Asets
CI I rrent LlbDI 1ltieS
I Long Term LIablI.
SNet Worth


1985 1988 1987


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


1986


1987


1988









Flowering Plants


Inventory values include growing plants and
supplies, which were presented previously in Table
1. The combined value of inventories averaged
$140,644 for the 1986 sample, $178,243 for the 1987
sample, and $136,261 for the 1988 sample.

Current assets averaged $224,650 for the 1986
sample, $306,766 for the 1987 sample, and $255,420
for the 1988 sample.

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
$287,243 for the 1986 sample, $549,142 for the 1987
sample, and $435,044 for the 1988 sample.
Subtracting accumulated depreciation left a current
value of $128,769 for the 1986 sample, $281,331 for
the 1987 sample, and $185,887 for the 1988 sample.
As a percentage of the original investment, these
current values represented 45 percent for the average


of the 1986 sample, 64 percent for the
and 43 percent for the 1988 sample.


1987 sample,


Total assets. The sum of current and long term
assets gives average total assets of $353,419 for the
1986 sample, $588,097 for the 1987 sample, and
$441,307 for the 1988 sample. These amounts are
the same as reported for "total owned capital" in
Table 1.

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

Current liabilities averaged $20,816 for the 1986
sample, $44,360 for the 1987 sample, and $37,753 for
the 1988 sample. The ratio of cash and accounts
receivable to current liabilities, known as the "quick
ratio", is a standard indicator of liquidity, i.e. the
ability to pay current operating expenses. The quick
ratio averaged 4.0 for the 1986 sample, 6.3 for the
1987 sample, and 3.2 for the 1988 sample.


Figure 19

Assets and Liabilities
Flowering Plant Nurseries, 1986, '87, '88

Dollars CThousands)
700,


600 ................................

500 ...................................


SCLrrent Assets
S Long Term Asets
CI I rrent LlbDI 1ltieS
I Long Term LIablI.
SNet Worth


1985 1988 1987


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


1986


1987


1988









Flowering Plants


Inventory values include growing plants and
supplies, which were presented previously in Table
1. The combined value of inventories averaged
$140,644 for the 1986 sample, $178,243 for the 1987
sample, and $136,261 for the 1988 sample.

Current assets averaged $224,650 for the 1986
sample, $306,766 for the 1987 sample, and $255,420
for the 1988 sample.

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
$287,243 for the 1986 sample, $549,142 for the 1987
sample, and $435,044 for the 1988 sample.
Subtracting accumulated depreciation left a current
value of $128,769 for the 1986 sample, $281,331 for
the 1987 sample, and $185,887 for the 1988 sample.
As a percentage of the original investment, these
current values represented 45 percent for the average


of the 1986 sample, 64 percent for the
and 43 percent for the 1988 sample.


1987 sample,


Total assets. The sum of current and long term
assets gives average total assets of $353,419 for the
1986 sample, $588,097 for the 1987 sample, and
$441,307 for the 1988 sample. These amounts are
the same as reported for "total owned capital" in
Table 1.

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

Current liabilities averaged $20,816 for the 1986
sample, $44,360 for the 1987 sample, and $37,753 for
the 1988 sample. The ratio of cash and accounts
receivable to current liabilities, known as the "quick
ratio", is a standard indicator of liquidity, i.e. the
ability to pay current operating expenses. The quick
ratio averaged 4.0 for the 1986 sample, 6.3 for the
1987 sample, and 3.2 for the 1988 sample.


Figure 19

Assets and Liabilities
Flowering Plant Nurseries, 1986, '87, '88

Dollars CThousands)
700,


600 ................................

500 ...................................


SCLrrent Assets
S Long Term Asets
CI I rrent LlbDI 1ltieS
I Long Term LIablI.
SNet Worth


1985 1988 1987


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


1986


1987


1988









Flowering Plants


Inventory values include growing plants and
supplies, which were presented previously in Table
1. The combined value of inventories averaged
$140,644 for the 1986 sample, $178,243 for the 1987
sample, and $136,261 for the 1988 sample.

Current assets averaged $224,650 for the 1986
sample, $306,766 for the 1987 sample, and $255,420
for the 1988 sample.

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
$287,243 for the 1986 sample, $549,142 for the 1987
sample, and $435,044 for the 1988 sample.
Subtracting accumulated depreciation left a current
value of $128,769 for the 1986 sample, $281,331 for
the 1987 sample, and $185,887 for the 1988 sample.
As a percentage of the original investment, these
current values represented 45 percent for the average


of the 1986 sample, 64 percent for the
and 43 percent for the 1988 sample.


1987 sample,


Total assets. The sum of current and long term
assets gives average total assets of $353,419 for the
1986 sample, $588,097 for the 1987 sample, and
$441,307 for the 1988 sample. These amounts are
the same as reported for "total owned capital" in
Table 1.

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

Current liabilities averaged $20,816 for the 1986
sample, $44,360 for the 1987 sample, and $37,753 for
the 1988 sample. The ratio of cash and accounts
receivable to current liabilities, known as the "quick
ratio", is a standard indicator of liquidity, i.e. the
ability to pay current operating expenses. The quick
ratio averaged 4.0 for the 1986 sample, 6.3 for the
1987 sample, and 3.2 for the 1988 sample.


Figure 19

Assets and Liabilities
Flowering Plant Nurseries, 1986, '87, '88

Dollars CThousands)
700,


600 ................................

500 ...................................


SCLrrent Assets
S Long Term Asets
CI I rrent LlbDI 1ltieS
I Long Term LIablI.
SNet Worth


1985 1988 1987


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


1986


1987


1988










Flowering Plants


Long term liabilities include notes payable and
mortgages. They averaged $96,533 for the 1986
sample, $114,131 for the 1987 sample, and $110,473
for the 1988 sample. The ratio of current liabilities
to long term liabilities was .22, .15, and .34,
respectively.

Total liabilities. The sum of current and long-
term liabilities gives total liabilities of $117,349 for
the 1986 sample, $158,490 for the 1987 sample, and
148,226 for the 1988 sample. The ratio of total
assets to total liabilities were, 3.0, 3.9, 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 the 1986
sample averaged was $236,071, for the 1987 sample
it was $429,607, and for the 1988 sample $293,080.


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 margin work together to yield the firm's return
on net worth. Figure 20 shows the three sections of
the profitability model: margin management, asset
management and leverage management. Data for
the 1986, 1987, and 1988 samples are given in the
top, middle, and bottom of each cell in the model.
Data for the 1988 sample (bottom box) will be
discussed to illustrate the operation of the model.

Margin Management
Total gain ($739,716) less total deductions
($641,233) and the operator's salary ($30,738) result
in return to capital (net profit, $67,745). This is
divided by total gain to yield an average net profit
margin of 9.2 percent for the 1988 sample.


Asset Management

Current assets ($255,420) plus long term assets
($185,887) yield total assets of $441,307. This is
divided into total gain ($739,716) to give an asset
turnover rate of 1.68. Asset turnover multiplied by
net profit margin (9.2 percent) results in an average
rate of return to capital of 15.4 percent.

Leverage Management
Current liabilities ($37,753) plus long term
liabilities ($110,473) results in average total liabilities
of $148,226. This is subtracted from total assets to
yield average net worth of $293,080. Total liabilities
plus net worth ($441,307) divided by net worth gives
a leverage factor of 1.51. This is really the ratio of
total assets under one's control to net worth.
Leverage times rate of return to capital (15.4
percent) gives a return on net worth of 23.1 percent
for the 1988 sample.


CONCLUDING COMMENTS
Nursery operators who are interested in seeing
how they compare with those participating in the
Florida Nursery Business Analysis Program may
calculate their own numbers by following instructions
under "Making Your Own Calculations" in the
Appendix. This analysis should improve management
decisions which 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 doing their own
calculations may wish to consider becoming a
participant in the Florida Nursery Business Analysis
Program. We need more participants in the program
to provide sounder and statistically more reliable
averages. If you would like to become a participant,
contact your ornamental agent in your county
Extension office, or contact the authors in
Gainesville. Nursery operators who authorize a
commercial accounting firm to supply the data
required for the program can participate with a
minimum of effort on their part.










Flowering Plants


Long term liabilities include notes payable and
mortgages. They averaged $96,533 for the 1986
sample, $114,131 for the 1987 sample, and $110,473
for the 1988 sample. The ratio of current liabilities
to long term liabilities was .22, .15, and .34,
respectively.

Total liabilities. The sum of current and long-
term liabilities gives total liabilities of $117,349 for
the 1986 sample, $158,490 for the 1987 sample, and
148,226 for the 1988 sample. The ratio of total
assets to total liabilities were, 3.0, 3.9, 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 the 1986
sample averaged was $236,071, for the 1987 sample
it was $429,607, and for the 1988 sample $293,080.


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 margin work together to yield the firm's return
on net worth. Figure 20 shows the three sections of
the profitability model: margin management, asset
management and leverage management. Data for
the 1986, 1987, and 1988 samples are given in the
top, middle, and bottom of each cell in the model.
Data for the 1988 sample (bottom box) will be
discussed to illustrate the operation of the model.

Margin Management
Total gain ($739,716) less total deductions
($641,233) and the operator's salary ($30,738) result
in return to capital (net profit, $67,745). This is
divided by total gain to yield an average net profit
margin of 9.2 percent for the 1988 sample.


Asset Management

Current assets ($255,420) plus long term assets
($185,887) yield total assets of $441,307. This is
divided into total gain ($739,716) to give an asset
turnover rate of 1.68. Asset turnover multiplied by
net profit margin (9.2 percent) results in an average
rate of return to capital of 15.4 percent.

Leverage Management
Current liabilities ($37,753) plus long term
liabilities ($110,473) results in average total liabilities
of $148,226. This is subtracted from total assets to
yield average net worth of $293,080. Total liabilities
plus net worth ($441,307) divided by net worth gives
a leverage factor of 1.51. This is really the ratio of
total assets under one's control to net worth.
Leverage times rate of return to capital (15.4
percent) gives a return on net worth of 23.1 percent
for the 1988 sample.


CONCLUDING COMMENTS
Nursery operators who are interested in seeing
how they compare with those participating in the
Florida Nursery Business Analysis Program may
calculate their own numbers by following instructions
under "Making Your Own Calculations" in the
Appendix. This analysis should improve management
decisions which 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 doing their own
calculations may wish to consider becoming a
participant in the Florida Nursery Business Analysis
Program. We need more participants in the program
to provide sounder and statistically more reliable
averages. If you would like to become a participant,
contact your ornamental agent in your county
Extension office, or contact the authors in
Gainesville. Nursery operators who authorize a
commercial accounting firm to supply the data
required for the program can participate with a
minimum of effort on their part.










Flowering Plants


Long term liabilities include notes payable and
mortgages. They averaged $96,533 for the 1986
sample, $114,131 for the 1987 sample, and $110,473
for the 1988 sample. The ratio of current liabilities
to long term liabilities was .22, .15, and .34,
respectively.

Total liabilities. The sum of current and long-
term liabilities gives total liabilities of $117,349 for
the 1986 sample, $158,490 for the 1987 sample, and
148,226 for the 1988 sample. The ratio of total
assets to total liabilities were, 3.0, 3.9, 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 the 1986
sample averaged was $236,071, for the 1987 sample
it was $429,607, and for the 1988 sample $293,080.


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 margin work together to yield the firm's return
on net worth. Figure 20 shows the three sections of
the profitability model: margin management, asset
management and leverage management. Data for
the 1986, 1987, and 1988 samples are given in the
top, middle, and bottom of each cell in the model.
Data for the 1988 sample (bottom box) will be
discussed to illustrate the operation of the model.

Margin Management
Total gain ($739,716) less total deductions
($641,233) and the operator's salary ($30,738) result
in return to capital (net profit, $67,745). This is
divided by total gain to yield an average net profit
margin of 9.2 percent for the 1988 sample.


Asset Management

Current assets ($255,420) plus long term assets
($185,887) yield total assets of $441,307. This is
divided into total gain ($739,716) to give an asset
turnover rate of 1.68. Asset turnover multiplied by
net profit margin (9.2 percent) results in an average
rate of return to capital of 15.4 percent.

Leverage Management
Current liabilities ($37,753) plus long term
liabilities ($110,473) results in average total liabilities
of $148,226. This is subtracted from total assets to
yield average net worth of $293,080. Total liabilities
plus net worth ($441,307) divided by net worth gives
a leverage factor of 1.51. This is really the ratio of
total assets under one's control to net worth.
Leverage times rate of return to capital (15.4
percent) gives a return on net worth of 23.1 percent
for the 1988 sample.


CONCLUDING COMMENTS
Nursery operators who are interested in seeing
how they compare with those participating in the
Florida Nursery Business Analysis Program may
calculate their own numbers by following instructions
under "Making Your Own Calculations" in the
Appendix. This analysis should improve management
decisions which 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 doing their own
calculations may wish to consider becoming a
participant in the Florida Nursery Business Analysis
Program. We need more participants in the program
to provide sounder and statistically more reliable
averages. If you would like to become a participant,
contact your ornamental agent in your county
Extension office, or contact the authors in
Gainesville. Nursery operators who authorize a
commercial accounting firm to supply the data
required for the program can participate with a
minimum of effort on their part.










Flowering Plants


Long term liabilities include notes payable and
mortgages. They averaged $96,533 for the 1986
sample, $114,131 for the 1987 sample, and $110,473
for the 1988 sample. The ratio of current liabilities
to long term liabilities was .22, .15, and .34,
respectively.

Total liabilities. The sum of current and long-
term liabilities gives total liabilities of $117,349 for
the 1986 sample, $158,490 for the 1987 sample, and
148,226 for the 1988 sample. The ratio of total
assets to total liabilities were, 3.0, 3.9, 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 the 1986
sample averaged was $236,071, for the 1987 sample
it was $429,607, and for the 1988 sample $293,080.


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 margin work together to yield the firm's return
on net worth. Figure 20 shows the three sections of
the profitability model: margin management, asset
management and leverage management. Data for
the 1986, 1987, and 1988 samples are given in the
top, middle, and bottom of each cell in the model.
Data for the 1988 sample (bottom box) will be
discussed to illustrate the operation of the model.

Margin Management
Total gain ($739,716) less total deductions
($641,233) and the operator's salary ($30,738) result
in return to capital (net profit, $67,745). This is
divided by total gain to yield an average net profit
margin of 9.2 percent for the 1988 sample.


Asset Management

Current assets ($255,420) plus long term assets
($185,887) yield total assets of $441,307. This is
divided into total gain ($739,716) to give an asset
turnover rate of 1.68. Asset turnover multiplied by
net profit margin (9.2 percent) results in an average
rate of return to capital of 15.4 percent.

Leverage Management
Current liabilities ($37,753) plus long term
liabilities ($110,473) results in average total liabilities
of $148,226. This is subtracted from total assets to
yield average net worth of $293,080. Total liabilities
plus net worth ($441,307) divided by net worth gives
a leverage factor of 1.51. This is really the ratio of
total assets under one's control to net worth.
Leverage times rate of return to capital (15.4
percent) gives a return on net worth of 23.1 percent
for the 1988 sample.


CONCLUDING COMMENTS
Nursery operators who are interested in seeing
how they compare with those participating in the
Florida Nursery Business Analysis Program may
calculate their own numbers by following instructions
under "Making Your Own Calculations" in the
Appendix. This analysis should improve management
decisions which 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 doing their own
calculations may wish to consider becoming a
participant in the Florida Nursery Business Analysis
Program. We need more participants in the program
to provide sounder and statistically more reliable
averages. If you would like to become a participant,
contact your ornamental agent in your county
Extension office, or contact the authors in
Gainesville. Nursery operators who authorize a
commercial accounting firm to supply the data
required for the program can participate with a
minimum of effort on their part.










Flowering Plants


Long term liabilities include notes payable and
mortgages. They averaged $96,533 for the 1986
sample, $114,131 for the 1987 sample, and $110,473
for the 1988 sample. The ratio of current liabilities
to long term liabilities was .22, .15, and .34,
respectively.

Total liabilities. The sum of current and long-
term liabilities gives total liabilities of $117,349 for
the 1986 sample, $158,490 for the 1987 sample, and
148,226 for the 1988 sample. The ratio of total
assets to total liabilities were, 3.0, 3.9, 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 the 1986
sample averaged was $236,071, for the 1987 sample
it was $429,607, and for the 1988 sample $293,080.


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 margin work together to yield the firm's return
on net worth. Figure 20 shows the three sections of
the profitability model: margin management, asset
management and leverage management. Data for
the 1986, 1987, and 1988 samples are given in the
top, middle, and bottom of each cell in the model.
Data for the 1988 sample (bottom box) will be
discussed to illustrate the operation of the model.

Margin Management
Total gain ($739,716) less total deductions
($641,233) and the operator's salary ($30,738) result
in return to capital (net profit, $67,745). This is
divided by total gain to yield an average net profit
margin of 9.2 percent for the 1988 sample.


Asset Management

Current assets ($255,420) plus long term assets
($185,887) yield total assets of $441,307. This is
divided into total gain ($739,716) to give an asset
turnover rate of 1.68. Asset turnover multiplied by
net profit margin (9.2 percent) results in an average
rate of return to capital of 15.4 percent.

Leverage Management
Current liabilities ($37,753) plus long term
liabilities ($110,473) results in average total liabilities
of $148,226. This is subtracted from total assets to
yield average net worth of $293,080. Total liabilities
plus net worth ($441,307) divided by net worth gives
a leverage factor of 1.51. This is really the ratio of
total assets under one's control to net worth.
Leverage times rate of return to capital (15.4
percent) gives a return on net worth of 23.1 percent
for the 1988 sample.


CONCLUDING COMMENTS
Nursery operators who are interested in seeing
how they compare with those participating in the
Florida Nursery Business Analysis Program may
calculate their own numbers by following instructions
under "Making Your Own Calculations" in the
Appendix. This analysis should improve management
decisions which 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 doing their own
calculations may wish to consider becoming a
participant in the Florida Nursery Business Analysis
Program. We need more participants in the program
to provide sounder and statistically more reliable
averages. If you would like to become a participant,
contact your ornamental agent in your county
Extension office, or contact the authors in
Gainesville. Nursery operators who authorize a
commercial accounting firm to supply the data
required for the program can participate with a
minimum of effort on their part.










Flowering Plants


Long term liabilities include notes payable and
mortgages. They averaged $96,533 for the 1986
sample, $114,131 for the 1987 sample, and $110,473
for the 1988 sample. The ratio of current liabilities
to long term liabilities was .22, .15, and .34,
respectively.

Total liabilities. The sum of current and long-
term liabilities gives total liabilities of $117,349 for
the 1986 sample, $158,490 for the 1987 sample, and
148,226 for the 1988 sample. The ratio of total
assets to total liabilities were, 3.0, 3.9, 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 the 1986
sample averaged was $236,071, for the 1987 sample
it was $429,607, and for the 1988 sample $293,080.


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 margin work together to yield the firm's return
on net worth. Figure 20 shows the three sections of
the profitability model: margin management, asset
management and leverage management. Data for
the 1986, 1987, and 1988 samples are given in the
top, middle, and bottom of each cell in the model.
Data for the 1988 sample (bottom box) will be
discussed to illustrate the operation of the model.

Margin Management
Total gain ($739,716) less total deductions
($641,233) and the operator's salary ($30,738) result
in return to capital (net profit, $67,745). This is
divided by total gain to yield an average net profit
margin of 9.2 percent for the 1988 sample.


Asset Management

Current assets ($255,420) plus long term assets
($185,887) yield total assets of $441,307. This is
divided into total gain ($739,716) to give an asset
turnover rate of 1.68. Asset turnover multiplied by
net profit margin (9.2 percent) results in an average
rate of return to capital of 15.4 percent.

Leverage Management
Current liabilities ($37,753) plus long term
liabilities ($110,473) results in average total liabilities
of $148,226. This is subtracted from total assets to
yield average net worth of $293,080. Total liabilities
plus net worth ($441,307) divided by net worth gives
a leverage factor of 1.51. This is really the ratio of
total assets under one's control to net worth.
Leverage times rate of return to capital (15.4
percent) gives a return on net worth of 23.1 percent
for the 1988 sample.


CONCLUDING COMMENTS
Nursery operators who are interested in seeing
how they compare with those participating in the
Florida Nursery Business Analysis Program may
calculate their own numbers by following instructions
under "Making Your Own Calculations" in the
Appendix. This analysis should improve management
decisions which 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 doing their own
calculations may wish to consider becoming a
participant in the Florida Nursery Business Analysis
Program. We need more participants in the program
to provide sounder and statistically more reliable
averages. If you would like to become a participant,
contact your ornamental agent in your county
Extension office, or contact the authors in
Gainesville. Nursery operators who authorize a
commercial accounting firm to supply the data
required for the program can participate with a
minimum of effort on their part.










Flowering Plants


Long term liabilities include notes payable and
mortgages. They averaged $96,533 for the 1986
sample, $114,131 for the 1987 sample, and $110,473
for the 1988 sample. The ratio of current liabilities
to long term liabilities was .22, .15, and .34,
respectively.

Total liabilities. The sum of current and long-
term liabilities gives total liabilities of $117,349 for
the 1986 sample, $158,490 for the 1987 sample, and
148,226 for the 1988 sample. The ratio of total
assets to total liabilities were, 3.0, 3.9, 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 the 1986
sample averaged was $236,071, for the 1987 sample
it was $429,607, and for the 1988 sample $293,080.


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 margin work together to yield the firm's return
on net worth. Figure 20 shows the three sections of
the profitability model: margin management, asset
management and leverage management. Data for
the 1986, 1987, and 1988 samples are given in the
top, middle, and bottom of each cell in the model.
Data for the 1988 sample (bottom box) will be
discussed to illustrate the operation of the model.

Margin Management
Total gain ($739,716) less total deductions
($641,233) and the operator's salary ($30,738) result
in return to capital (net profit, $67,745). This is
divided by total gain to yield an average net profit
margin of 9.2 percent for the 1988 sample.


Asset Management

Current assets ($255,420) plus long term assets
($185,887) yield total assets of $441,307. This is
divided into total gain ($739,716) to give an asset
turnover rate of 1.68. Asset turnover multiplied by
net profit margin (9.2 percent) results in an average
rate of return to capital of 15.4 percent.

Leverage Management
Current liabilities ($37,753) plus long term
liabilities ($110,473) results in average total liabilities
of $148,226. This is subtracted from total assets to
yield average net worth of $293,080. Total liabilities
plus net worth ($441,307) divided by net worth gives
a leverage factor of 1.51. This is really the ratio of
total assets under one's control to net worth.
Leverage times rate of return to capital (15.4
percent) gives a return on net worth of 23.1 percent
for the 1988 sample.


CONCLUDING COMMENTS
Nursery operators who are interested in seeing
how they compare with those participating in the
Florida Nursery Business Analysis Program may
calculate their own numbers by following instructions
under "Making Your Own Calculations" in the
Appendix. This analysis should improve management
decisions which 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 doing their own
calculations may wish to consider becoming a
participant in the Florida Nursery Business Analysis
Program. We need more participants in the program
to provide sounder and statistically more reliable
averages. If you would like to become a participant,
contact your ornamental agent in your county
Extension office, or contact the authors in
Gainesville. Nursery operators who authorize a
commercial accounting firm to supply the data
required for the program can participate with a
minimum of effort on their part.










Flowering Plants


Long term liabilities include notes payable and
mortgages. They averaged $96,533 for the 1986
sample, $114,131 for the 1987 sample, and $110,473
for the 1988 sample. The ratio of current liabilities
to long term liabilities was .22, .15, and .34,
respectively.

Total liabilities. The sum of current and long-
term liabilities gives total liabilities of $117,349 for
the 1986 sample, $158,490 for the 1987 sample, and
148,226 for the 1988 sample. The ratio of total
assets to total liabilities were, 3.0, 3.9, 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 the 1986
sample averaged was $236,071, for the 1987 sample
it was $429,607, and for the 1988 sample $293,080.


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 margin work together to yield the firm's return
on net worth. Figure 20 shows the three sections of
the profitability model: margin management, asset
management and leverage management. Data for
the 1986, 1987, and 1988 samples are given in the
top, middle, and bottom of each cell in the model.
Data for the 1988 sample (bottom box) will be
discussed to illustrate the operation of the model.

Margin Management
Total gain ($739,716) less total deductions
($641,233) and the operator's salary ($30,738) result
in return to capital (net profit, $67,745). This is
divided by total gain to yield an average net profit
margin of 9.2 percent for the 1988 sample.


Asset Management

Current assets ($255,420) plus long term assets
($185,887) yield total assets of $441,307. This is
divided into total gain ($739,716) to give an asset
turnover rate of 1.68. Asset turnover multiplied by
net profit margin (9.2 percent) results in an average
rate of return to capital of 15.4 percent.

Leverage Management
Current liabilities ($37,753) plus long term
liabilities ($110,473) results in average total liabilities
of $148,226. This is subtracted from total assets to
yield average net worth of $293,080. Total liabilities
plus net worth ($441,307) divided by net worth gives
a leverage factor of 1.51. This is really the ratio of
total assets under one's control to net worth.
Leverage times rate of return to capital (15.4
percent) gives a return on net worth of 23.1 percent
for the 1988 sample.


CONCLUDING COMMENTS
Nursery operators who are interested in seeing
how they compare with those participating in the
Florida Nursery Business Analysis Program may
calculate their own numbers by following instructions
under "Making Your Own Calculations" in the
Appendix. This analysis should improve management
decisions which 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 doing their own
calculations may wish to consider becoming a
participant in the Florida Nursery Business Analysis
Program. We need more participants in the program
to provide sounder and statistically more reliable
averages. If you would like to become a participant,
contact your ornamental agent in your county
Extension office, or contact the authors in
Gainesville. Nursery operators who authorize a
commercial accounting firm to supply the data
required for the program can participate with a
minimum of effort on their part.









Figure 20 -- Total Profitability Model for Flowering Plant Nurseries, 1986, 1987, 1988.
---!argin Management ----............. ... ....... ...........
total gain Sample Year Key
********t****** ***************
$587,442 1986 *
$808,580 **** return to capital 1987 *
$739,716 ************** 1988 *
************** $52,331 ***************
**** $79,296 ****
$67,745 net margin
deductions *********** ***********
incl. op. sal. / 8.9% *
************** **** 11.2% ****
$535,112 total gain 9.2% *
$729,283 **** ********** *********** *
$671,971 $587,442 Rate of
************* $808,580 **** Return
$739,716 ***********
************** 14.8% *
---Asset Management--- -....................................... x **** 13.5% ****
15.4% *
cash total gain ********** *
************ ************** *
* t11,498 $587,442 *
* 125,820 **** $808,580 **** *
* t27,407 current assets $739,716 *
************** *************** ************** asset *
+ $224,650 turnover *
***** $306,766 **** ********** *
acts recvbl. $255,420 *1.66 *
******t****** *************** / **** 1.37 ***** *
* 172,508 * 1.68 *
* Z102,702 **** ********** *
* !91,753 *
**t*********** total assets *
+ **************** *
$353,419 *
plant inventory + ***** $588,097 ***** *
************** $441,307 *
* t128,743 ****************
* !165,582 **** *
* 1123,634 long-term assets *
**flt********* *************** *
+ $128,769 *
$281,331 **** *
supply inv. $185,887 *
************* *************** *


* $11,901 *
* T12,661 **** Return on
* 12,627 Net Worth
************** **********
22.2% *
---Leverage Management ------................................... ............... x **** 18.5X *
liability plus 23.1% *
current liab. total liab. net worth **********
************** ************** *************** *
$20,816 $117,349 $353,419 *
$44,360 ********* $158,490 ******** $588,097 **** *
$37,753 $148,226 $441,307 leverage *
************** *********** ***** ****** *********** *
+ + / 1.50 *
***** 1.37 ********
long term debt net worth net worth 1.51 *
************** ********* *** ****** *************** ***********
$96,553 $236,071 $236,071 *
$114,131 ***** $429,607 ***** $429,607 ****
$110,473 $293,080 $293,080 *
************* ************** ***************








22 Flowering Plants







Flowering Plants


APPENDIX

Appendix Table of Contents

D definitions . . . . .. . . . .. .. . .. . .
M making your own calculations ................................................
A ppe ndix Tables ................................................ .........


List of Appendix Data Tables
Appendix Table


Page
.. 24
.. 24
. 26


Page


1 Size of business, flowering plant nurseries in Florida, 1986, 1987, 19830 ................... 26
2 Rates of production, flowering plant nurseries in Florida, 1986, 1987, 1988 ................ 27
3 Land use indicators, flowering plant nurseries in Florida, 1986, 1987, 1988 ................ 27
4 Labor use indicators, flowering plant nurseries in Florida, 1986, 1987, 1988 ................ 27
5 Capital use indicators, flowering plant nurseries in Florida, 1986, 1987, 1988 ............... 28
6 Costs by expense category, flowering plant nurseries in Florida, 1986, 1987, 1988 ............ 29
7 Percent of total costs by expense category, flowering plant nurseries in
Florida, 1986, 1987, 1988 .................................. .. ........ 30
8 Costs per square foot of bed and bench space, flowering plant nurseries in
Florida, 1986, 1987, 1988 .................. .............................. 31
9 Costs per square foot of propagating and finishing space, flowering plant nurseries
in Florida, 1986, 1987, 1988 .............................................. 32
10 Costs per dollar's worth of production, flowering plant nurseries in Florida,
1986, 1987, 1988 ....................................................... 33
11 Cost per dollar's worth of sales (no adjustment for change in plant
inventory), flowering plant nurseries in Florida, 1986, 1987, 1988 ..................... 34
12 Income summary, flowering plant nurseries in Florida, 1986, 1987, 1988 ........... ......... 35
13 Statement of Financial Position, flowering plant nurseries in Florida, 1986, 1987, 1988 ......... 35
14 Financial Ratios and other profitability indicators, flowering plant nurseries
in Florida, 1986, 1987, 1988 ................................................ 36


19~li~








Flowering Plants


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

Calculations for Appendix Table 7 through
Appendix Table 11 are made by dividing your data
on each line of Appendix Table 6 by the appropriate
figure as follows:

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

Appendix Table 8--divide data in Appendix Table
6 by square footage figure for total bed and bench
space on line F of Appendix Table 1.

Appendix Table 9--divide data in Appendix Table
6 by square footage figure for propagating and
finishing space on line D of Appendix Table 1.

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

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








Flowering Plants


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

Calculations for Appendix Table 7 through
Appendix Table 11 are made by dividing your data
on each line of Appendix Table 6 by the appropriate
figure as follows:

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

Appendix Table 8--divide data in Appendix Table
6 by square footage figure for total bed and bench
space on line F of Appendix Table 1.

Appendix Table 9--divide data in Appendix Table
6 by square footage figure for propagating and
finishing space on line D of Appendix Table 1.

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

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









Flov.ering Plants


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


Line A: Value of own plants sold .......
Line B: Change in plant inventory value .
Line C: Supply inventory increase .......
shown previously
Line D: Miscellaneous income .........
Line E: Total gain ..................
Line F: Deduct cash costs .............
Line G: Deduct non-cash costs .........
Line H: Total deductions .............
Line I: Net nursery income ............
Line J: Deduct operator's salary ........
Line K: Return to capital .............
Line L: Rate of return to capital ........


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

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


Instructions for Appendix Table 13 are as follows:


Line A:
Line B:
Line C:
Line D:
Line E:
Line F:
Line G:
Line H:


Cash on hand ...............
Accounts receivable ...........
Plant inventory ..............
Supply inventory .............
Total current assets ...........
Machinery & equipment ........
Buildings and fixtures ..........
Land .....................


(Skip lines I and J if lines F, G, and H are
depreciated values.)
Line K: Total long term assets .........
Line L: Total assets .................
Line M: Current liabilities ............
Line N: Long term liabilities ...........
Line O: Total liabilities ..............
Line P: Net worth ..................
Line Q: Total liabilities and net worth ....


Appendix Table 1 line P
Appendix Table 1 line O
Appendix Table 1 line J
Appendix Table 1 line N
"sum lines A,B,C and D
Appendix Table 1 line L
Appendix Table 1 line K
Appendix Table 1 line M
depreciated values. If not, use these two lines to get

sum lines F,G,H,I & J
sum lines E and K
from your records, not shown in earlier tables
"from your records, not shown in earlier tables
sum line M and N
line L minus line O
sum lines O and P


This data required for the profitability model.



The business analysis calculations can also be done yourself with IFAS's MS-DOS compatible computer
program FOLAGNBA. Order program number 003, priced at $20, from:

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












Flowering Plants


APPENDIX TABLES


Appendix Table 1--Size of Business: Flowering Plant Nurseries in Florida, 1986, 1987, 1988.

1986 1987 1988 Your
unit sample sample sample Nursery
..... .. ............... .. ....... ........ .......................... .....................................


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

C Total value of production. . . ... S


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


F Total bed & bench space . . .


558,537
24,663

583,200


.sq.ft. 92,589
.sq.ft. 3,530

.sq.ft. 96,119


G Total nursery area . . .... .sq.ft. 135,131
H acres 3.10

I Full-time equivalent persons . .number 34.93


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


0 Total Owned Capital. . . . $


------------Capital Leased-------------
Btdgs, improvements . .
Machinery & equipment . .
Land . . . .


. . $
. . $
. . $


U Total Leased Capital . . .... .

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

AC Total Managed Capital. . . ... .


128,743
106,476
12,626
9,667
11,901
72,508
11,498

353,419


173,008
4,278
106,786

284,071


128,743
279,484
16,904
116,453
11,901
72,508
11,498

637,491


804,933
587

805,520

128,221
2,547

130,768


725,242
6,074

731,316

114,347
1,867

116,214


193,933 169,771
4.45 3.90


21.96


165,582
90,308
106,756
84,267
12,661
102,702
25,820

588,097


16,600
3,200
19,500

39,300


165,582
106,908
109,956
103,767
12,661
102,702
25,820

627,397


21.83


123,634
71,077
22,859
91,950
12,627
91,753
27,407

441,307


11,857
2,286
13,929

28,071


123,634
82,934
25,145
105,879
12,627
91,753
27,407

469,378


. .
. .








Flowering Plants


Appendix Table 2--Rates of Production, flowering plant nurseries in Florida, 1986, 1987, 1988.


1986 1987 1988 Your
unit sample sample sample Nursery
................................................................ ...........................................

rn-es/sq.ft. of bed & bench space .(Table 1A/1F) $ 5.81 6.16 6.24
VnPue of production/sq.ft. bed & bench (Table 1C/1F) S 6.07 6.16 6.29

Srles/sq.ft. prop. & finish, space (Table 1A/1D) S 6.03 6.28 6.34
Vrlue of prod./sq.ft. prop. & finish (Table 1C/1D) $ 6.30 6.28 6.40

Elres per acre of total nursery area (Table 1A/1H) S 180,047 180,799 186,083
Vrlue of production per acre ..... (Table 1C/1H) S 187,997 180,931 187,641




Appendix Table 3--Labor Use Indicators: Flowering Plant Nurseries in Florida, 1986, 1987, 1988.


1986 1987 1988 Your
unit sample sample sample Nursery
..........................-............... ... ..............................................................

Plant sales per person* ....... .(Table 1A/11) S 15,990 36,655 33,222
vzlue of production per person* .(Table 1C/11) S 16,697 36,682 33,500

Total bed & bench space per person* .(Table 1F/1I) sq.ft. 2,752 5,955 5,324
Propagating & finishing space per perso(Table 1D/11) sq.ft. 2,651 5,839 5,238
Total nursery area per person*. .(Table 1G/11) sq.ft. 3,869 8,831 7,777

rersons* per acre total nursery area. .(Table 11/1H) number 15.8 7.3 8.2


Full-time equivalent person (2080 hrs/year)



Appendix Table 4--Space Use Indicators: Flowering Plant Nurseries in Florida, 1986, 1987, 1988.


1986 1987 1988 Your
unit sample sample sample Nursery


Plant inventory turnover ....... (Table 1A/1J) X 433.8 486.1 586.6

averagee vacant bed & bench space .......... sq.ft. 17,930 23,322 22,379
--percentage of total bed & bench space........ 18.7 17.8 19.3

Total nursery area ................. sq.ft. 135,131 193,933 169,771
(including roads, parking areas, etc.)

Total bed & bench space. .............. sq.ft. 96,119 130,768 116,214
*-percentage of total nursery area (Table 1F/1G) % 71.1 67.4 68.5

Propagating & finishing space. ............ sq.ft. 92,589 128,221 114,347
--percentage of total bed & bench space(Table 1D/1F) % 96.3 98.1 98.4

Stock plant space. ................. sq.ft. 3,530 2,547 1,867
--percentage of total bed & bench space(Table 1E/1F) % 3.7 1.9 1.6










Flowering Plants


Appendix Table 5--Capital Use Indicators: Flowering Plant Nurseries in Florida, 1986, 1987, 1988.

1986 1987 1988 Your
unit sample sample sample Nursery
........................ ............ .......................... ... ................................

Owned capital turnover. ...... (Table 1A/1Q) X 158.0 136.9 164.3
Managed capital turnover. ..... (Table 1A/1AC) X 87.6 128.3 154.5

Capital owned/person* ....... (Table 10/11) $ 10,118 26,781 20,215
Capital managed/person* ...... (Table 1AC/11) S 18,251 28,571 21,501

Capital owned/acre. ........ (Table 1Q/1H) $ 113,927 132,095 113,231
Capital managed/acre. ....... (Table 1AC/1H) S 205,498 140,922 120,433

---Managed Capital Per Person In---
Growing plants. ........... (Table 1V/11) S 3,686 7,540 5,663
Bldgs, improvements ........ (Table 1W/11) S 8,001 4,868 3,799
Machinery & equipment ....... (Table 1X/1I) S 484 5,007 1,152
Land. ............... (Table 1Y/11) $ 3,334 4,725 4,850

---Managed Capital Per Acre In--
Growing plants. ........... (Table 1V/1H) S 41,501 37,192 31,722
BLdgs, improvements ........ (Table 1W/1H) S 90,093 24,013 21,279
Machinery & equipment ....... (Table IX/1H) $ 5,449 24,698 6,452
Land. ............... (Table 1Y/1H) S 37,539 23,307 27,166

---Distribution of Managed Capital---
in growing plants ......... (Table 1V/AC) X 20.2 26.4 26.3
in buildings & wells. ....... (Table 1W/AC) X 43.8 17.0 17.7
in machinery & equipment. ...... (Table 1X/AC) X 2.7 17.5 5.4
in land .............. (Table 1Y/AC) X 18.3 16.5 22.6
in supply inventory ........ (Table 1Z/AC) X 1.9 2.0 2.7
in accounts receivable. ...... (Table 1AA/AC) X 11.4 16.4 19.5
in cash/checkbook balance ..... (Table 1AB/AC) X 1.8 4.1 5.8

TOTAL. ................... .. X 100.0 100.0 100.0


Full-time equivalent person (2080 hrs/year)






Flowering Plants


Appendix Table 6--Costs by Expense Category: Flowering Plant Nurseries In Florida, 1986, 1987, 1988.


1986 1987 1988
unit sample sample sample
............................................... ............. ........... ........ ....... ....


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

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 . . . . .


34,288
154,602

188,890


$ 108,173
S 27,272
$ 12,787
S 15,594
$ 6,853
$ 8,804
$ 18,372
S 15,323

$ 213,177


19,743
10,029

29,772

1,826
9,581
4,359
9,192
7,812
3,270
3,825
34,468

74,333

506,172

13,015
15,923
0
42,410

71,349

577,521


32,852
250,597

283,449

116,616
40,795
16,049
25,001
11,250
13,568
20,287
16,838

260,403

20,681
21,978

42,660

3,401
11,025
7,203
6,478
2,642
4,271
15,479
53,583

104,082

690,594

17,400
20,808
481
70,572

109,261

799,855


Your
Nursery
..........


30,738
218,703

249,441

126,735
43,363
10,474
20,870
10,413
23,248
28,817
15,087

279,007

18,573
20,461

39,034

4,304
11,451
4,914
7,114
2,069
2,587
10,080
28,944

71,462
s======ss=
638,944

9,736
23,291
0
52,957

85,984

724,928








Flowering Plants


Appendix Table 7--Percent of Total Costs by Expense Category: Flowering Plant Nurseries In Florida, 1986, 1987, 1988.

1986 1987 1988 Your
unit sample sample sample Nursery
..... .............. ............. .................................... ....... ...........................2


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

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

Plants & seeds .................
Containers ...................
Heating fuel. ..................
Peat & soil . . . . .
Fertilizers & time. . . . .
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/equ
Depreciation-buitdings/etc
Supply inventory decrease
Interest on capital .

TOTAL NON-CASH COSTS. .

TOTAL ALL COSTS . .


% 5.9
X 26.8

X 32.7

X 18.7
X 4.7
X 2.2
X 2.7
X 1.2
X 1.5
X 3.2
X 2.7

X 36.9

X 3.4
X 1.7

X 5.2

X 0.3
% 1.7
X 0.8
X 1.6
% 1.4
X 0.6
X 0.7
% 6.0

X 12.9

X 87.6


ipment . ... 2.3
. . . 2.8
. . . % 0.0
. . . 7.3

. . . 12.4

. . . 100.0


4.1
31.3

35.4

14.6
5.1
2.0
3.1
1.4
1.7
2.5
2.1

32.6

2.6
2.7

5.3

0.4
1.4
0.9
0.8
0.3
0.5
1.9
6.7

13.0

86.3

2.2
2.6
0.1
8.8

13.7

100.0


4.2
30.2

34.4

17.5
6.0
1.4
2.9
1.4
3.2
4.0
2.1

38.5

2.6
2.8

5.4

0.6
1.6
0.7
1.0
0.3
0.4
1.4
4.0

9.9

88.1

1.3
3.2
0.0
7.3

11.9

100.0






Flowering Plants


ApFendix Table 8--Costs Per Square Foot of Total Growing Area: Flowering Plant Nurseries in Florida, 1986, 1987, 1988.


1986 1987
unit sample sample


1988 Your
sample Nursery


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

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


35.7
160.8

196.5

112.5
28.4
13.3
16.2
7.1
9.2
19.1
15.9

221.8

20.5
10.4

31.0


. cents 1.9
. cents 10.0
. cents 4.5
. cents 9.6
. cents 8.1
. cents 3.4
. cents 4.0
. cents 35.9

cents 77.3

. cents 526.6


cents
cents
cents
cents


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

TOTAL ALL COSTS . . . ... cents


13.5
16.6
0.0
44.1

74.2

600.8


25.1
191.6

216.8

89.2
31.2
12.3
19.1
8.6
10.4
15.5
12.9

199.1

15.8
16.8

32.6

2.6
8.4
5.5
5.0
2.0
3.3
11.8
41.0

79.6

528.1

13.3
15.9
0.4
54.0

83.6

611.7


26.4
188.2

214.6

109.1
37.3
9.0
18.0
9.0
20.0
24.8
13.0

240.1

16.0
17.6

33.6

3.7
9.9
4.2
6.1
1.8
2.2
8.7
24.9

61.5

549.8

8.4
20.0
0.0
45.6

74.0

623.8









Flowering Plants


Appendix Table 9--Costs Per Square Foot of Propagating & Finishing Space: Flowering Plant Nurseries in Florida, 1986,
1987, 1988.

1986 1987 1988 Your
unit sample sample sample Nursery


Operator's salary ................ cents 37.0 25.6 26.9
Other wages ................... cents 167.0 195.4 191.3

LABOR TOTAL ................... cents 204.0 221.1 218.1

Plants & seeds. ................. cents 116.8 90.9 110.8
Containers. ................... cents 29.5 31.8 37.9
Heating fuel. .................. cents 13.8 12.5 9.2
Peat & soil ................... cents 16.8 19.5 18.3
Fertilizers & Lime. ............... cents 7.4 8.8 9.1
Pesticides & chemicals. ............. cents 9.5 10.6 20.3
Shipping supplies ................ cents 19.8 15.8 25.2
Other production supplies ............ cents 16.5 13.1 13.2

SUPPLIES TOTAL. ................. cents 230.2 203.1 244.0

Facility repairs. ................ cents 21.3 16.1 16.2
Equipment operation ............... cents 10.8 17.1 17.9

OTHER PROOUCTION COSTS TOTAL. ............ cents 32.2 33.3 34.1

Travel.................... .. cents 2.0 2.7 3.8
Insurance .................... cents 10.3 8.6 10.0
Telephone .................... cents 4.7 5.6 4.3
Electricity ................... cents 9.9 5.1 6.2
Taxes & licenses ................ cents 8.4 2.1 1.8
Advertising ...................cents 3.5 3.3 2.3
Rent-land/buildings ............... cents 4.1 12.1 8.8
Other cash costs. ................ cents 37.2 41.8 25.3
-------. --. .......... ..........-
ADMINISTRATIVE & OVERHEAD COSTS TOTAL ...... cents 80.3 81.2 62.5

TOTAL CASH COSTS. ................ cents 546.7 538.6 558.8

Depreciation-machinery/equipment. ........ cents 14.1 13.6 8.5
Depreciation-buildings/etc. ............ cents 17.2 16.2 20.4
Supply inventory decrease ............ cents 0.0 0.4 0.0
Interest on capital ............... cents 45.8 55.0 46.3

TOTAL NON-CASH COSTS. .............. cents 77.1 85.2 75.2

TOTAL ALL COSTS ................. cents 623.8 623.8 634.0










Flowering Plants 33






Appendix Table 10--Cost Per Dollar's Worth of Production: Flowering Plant Nurseries in Florida, 1986, 1987, 1988.

1986 1987 1988 Your
unit sample sample sample Nursery
................ o..........o.............. .. ....... ................o................. .........................


Operator's salary . .
Other wages . .


. . . cents
. . . cents


LABOR TOTAL . . . .... cents

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

SUPPLIES TOTAL. . . . ... cents


Facility repairs . .
Equipment operation . .


. . cents
. . . 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 . . . .

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


5.9
26.5

32.4

18.5
4.7
2.2
2.7
1.2
1.5
3.2
2.6

36.6

3.4
1.7

5.1


cents 0.3
cents 1.6
cents 0.7
cents 1.6
cents 1.3
cents 0.6
cents 0.7
cents 5.9

cents 12.7

cents 86.8


. cents 2.2
. cents 2.7
. cents 0.0
. cents 7.3

. cents 12.2

Scents 99.0


4.1
31.1

35.2

14.5
5.1
2.0
3.1
1.4
1.7
2.5
2.1

32.3

2.6
2.7

5.3

0.4
1.4
0.9
0.8
0.3
0.5
1.9
6.7

12.9

85.7

2.2
2.6
0.1
8.8

13.6

99.3


4.2
29.9

34.1

17.3
5.9
1.4
2.9
1.4
3.2
3.9
2.1

38.2

2.5
2.8

5.3

0.6
1.6
0.7
1.0
0.3
0.4
1.4
4.0

9.8

87.4

1.3
3.2
0.0
7.2

11.8

99.1










34 Flowering Plants






Appendix Table 11--Cost Per Dollar's Worth of Sates: Flowering Plant Nurseries in Florida, 1986, 1987, 1988.

1986 1987 1988 Your
unit sample sample sample Nursery


Operator's salary ................ cents 6.1 4.1 4.2
Other wages ................... cents 27.7 31.1 30.2

LABOR TOTAL ................... cents 33.8 35.2 34.4

Plants & seeds. ................. cents 19.4 14.5 17.5
Containers. ................... cents 4.9 5.1 6.0
Heating fuel. .................. cents 2.3 2.0 1.4
Peat & soil ................... cents 2.8 3.1 2.9
Fertilizers & Lime. ............... cents 1.2 1.4 1.4
Pesticides & chemicals. ............. cents 1.6 1.7 3.2
Shipping supplies ................ cents 3.3 2.5 4.0
Other production supplies ............ cents 2.7 2.1 2.1

SUPPLIES TOTAL. ................. cents 38.2 32.4 38.5

Facility repairs. ................ cents 3.5 2.6 2.6
Equipment operation ............... cents 1.8 2.7 2.8

OTHER PRODUCTION COSTS TOTAL. ............ cents 5.3 5.3 5.4

Travel. ................... .. cents 0.3 0.4 0.6
Insurance ................... cents 1.7 1.4 1.6
Telephone ................... cents 0.8 0.9 0.7
Electricity ................... cents 1.6 0.8 1.0
Taxes & liscenses ................ cents 1.4 0.3 0.3
Advertising ................... cents 0.6 0.5 0.4
Rent-tand/buildings ............... cents 0.7 1.9 1.4
Other cash costs. ................ cents 6.2 6.7 4.0

ADMINISTRATIVE & OVERHEAD COSTS TOTAL ...... cents 13.3 12.9 9.9

TOTAL CASH COSTS. ................ cents 90.6 85.8 88.1

Depreciation-machinery/equipment. ........ cents 2.3 2.2 1.3
Depreciation-buildings/etc. ............ cents 2.9 2.6 3.2
Supply inventory decrease ............ cents 0.0 0.1 0.0
Interest on capital ............... cents 7.6 8.8 7.3

TOTAL NON-CASH COSTS. .............. cents 12.8 13.6 11.9

TOTAL ALL COSTS ................. cents 103.4 99.4 100.0









Flowering Plants


Appendix Table 12--Income Sumnary: Flowering Plant Nurseries in Florida, 1986, 1987, 1988.


1986 1987 1988
unit sample sample sample


A Value of own plants sold . . .... S 558,537 804,933 725,242
E Change in plant inventory value. . .. S 24,663 587 6,074
C Increase in supply inventory . . .. 914 0 4,653
D Miscellaneous cash income . . ... 3,328 3,060 3,748


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


587,442


F Deduct cash costs except operator's salary . (471,885)
G Deduct non-cash costs except interest on capital $ (28,939)

H Total Deductions . . . ... S (500,824)

I NET NURSERY INCOME . . . ... $. 86,618
J Operator's salary or time value. . ... 34,288

K RETURN TO CAPITAL. ................ $ 52,331
L --Percent. . . . . 14.81


808,580

(657,742)
(38,690)

(696,431)

112,149
32,852

79,296
13.48


Your
Nursery


739,716

(608,206)
(33,027)

(641,233)

98,483
30,738

67,745
15.35


Arpendix Table 13--Statement of Financial Position: Flowering Plant Nurseries in Florida, 1986, 1987, 1988.

1986 1987 1988 Your
unit sample sample sample Nursery

---Current Assets---
A Cash/checkbook balance ............. $ 11,498 25,820 27,407
E Accounts receivable. ............... S 72,508 102,702 91,753
C Plant inventory value. .............. S 128,743 165,582 123,634
D Supply inventory value .............. $ 11,901 12,661 12,627

E Total CURRENT Assets ............... $ 224,650 306,766 255,420

S--Long Term Assets--*
F Machinery & Equipment. .............. S 76,712 203,162 95,323
G Buildings & Fixtures .............. $ 200,864 261,714 247,771
H Land ....................... S 9,667 84,267 91,950

I Sub-total (original cost). ............ S 287,243 549,142 435,044

J Less Accumulated Depreciation. .......... S (158,474) (267,811) (249,157)

K Total LONG TERM Assets .............. $ 128,769 281,331 185,887

L TOTAL ASSETS .......... . .. S 353,419 588,097 441,307

---Liabilities---
II Current Liabilities. .................. S 20,816 44,360 37,753
N Long Term Liabilities. . ......... $ 96,533 114,131 110,473

0 Total LIABILITIES. ................ S 117,349 158,490 148,226

P NET WORTH. ..................... 236,071 429,607 293,080
S T L & N W88= ====S ===
O TOTAL LIABILITIES & NET UORTH............ $ 353,419 588,097 441,307 ____











36 Flowering Plants







Appendix Table 14--Financial Ratios and Other Profitability Indicators: Flowering Plant Nurseries in Florida,
1986, 1987, 1988.

1986 1987 1988 Your
sample sample sample Nursery


Cash on Hand/Current Liabilities ............ 0.55 1.09 0.73

Accounts Recievable/Sales. ............... 0.13 0.17 0.13

Inventory Turnover ................... 4.34 4.86 5.87

Current Value/Orig. Cost of Long Term Assets ...... 0.45 0.64 0.43

Quick Ratio (Cash & Acct.Rec./Curr.Liab) ........ 4.04 6.31 3.16

Current Liabilities/Long Term Liabilities. .. .... 0.22 0.15 0.34

Total Assets/Total Liabilities ............. 3.01 3.91 2.98

Net Margin . . . . . 8.9% 11.2% 9.2%

Asset Turnover Ratio .................. 1.66 1.38 1.68

Return to Capital. .................. 14.81% 13.48% 15.35%

Leverage Factor. ................... 1.50 1.34 1.51


Return on Net Worth . . . . .


22.2%


18.1% 23.1%




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