A tornado tore through Sanford, North Carolina, on the afternoon of April 16, 2011. David Watson remembers seeing three-foot waves on his pond in the moments before he and his wife Gaye sought shelter from the tearing winds. When the couple emerged from their basement after the tornado passed, all they could see was sky. Their home, vehicles, and the seven greenhouses that sat on Watson’s Nursery, the business they owned and operated adjacent to their house, were gone.
In the days that followed, friends, family and nursery owners from across the state came to help clear the wreckage. The Watsons stopped totaling their business losses after passing $1 million of destroyed product; to continue counting was too painful and futile. After two decades of insuring his inventory, David had recently cancelled the nursery’s insurance policy. A different kind of storm had been wreaking havoc on the business for several years--the recession of 2008--and he’d diverted the money budgeted for insurance elsewhere, to keep the business afloat.
In March, Marketplace Business reported that the recession of 2008 had devastated the country’s nursery industry. It has deeply affected North Carolina’s which brings over $500 million dollars of revenue to the state. At a recent industry meeting, David, who has operated Watson’s Nursery for 37 years, learned dozens of nurseries have closed since 2008. Those that remain have scrapped to keep their doors open.
Corey Connors, Executive Director of the North Carolina Nursery and Landscape Association, says, “North Carolina fared a little better than its contemporary peer states” since the recession, but that the number of nursery farms has decreased 3.8 percent between 2007 and 2012, and when adjusted for inflation, the value of sales in the industry overall has fallen more than $46 million dollars during the same time frame.
“I’d always heard that the flower business was recession proof because people are going to plant flowers,” says Larry Fish, owner of Tarheel Nursery in Angier. “I had never seen a recession affect the nursery business. I’d never seen it. I’d been through several recessions...I can’t even tell you about them because they didn’t affect me,” says Larry who, like David, has run his nursery for 37 years.
“2008 turned out to be a disastrous year,” he says, “That was the first year I didn’t make money in this business.”
The nursery industry relies on wholesale and retail clients. For many years, both Larry, who specializes in annuals and perennial plants and flowers, and David, who concentrates on shrubbery and woody ornamentals like azaleas, camellias, and hydrangeas, relied heavily on wholesale clients. As the economy tightened, landscapers went out of business, and both men suddenly had more product than they could sell.
As the market contracted, the cost of fuel skyrocketed and drove up the cost of fertilizer, freight, and plastic containers. Larry believes that, “Just that one factor--it changed everything in this industry. [The cost of] all the supplies--like the plastic pots--more than doubled.” David agrees, “Everything we have is based off of fuel.” Larry says, “I think that’s what took us down.”
Brian Whipker, a Professor at NC State’s Department of Horticultural Science, believes the industry’s struggle is tied more closely to the housing crisis than the cost of fuel. Real estate development slowed dramatically when the housing bubble burst in 2008, and Whipker says, “When you don’t have houses built, you don’t have people putting in trees and shrubs and flowers.”
Growing plants is an art taught through a mixture of trial and error and mentorship and is shaped by divine provenance--drought and extreme temperatures can wreck a perfectly sowed field or greenhouse.
Both Larry and David grow their own products, tending to them just as a farmer would manage crops. David mixes his own mulch, and hand built all the greenhouses and storage units on his property. Larry, who didn’t know much about flowers when he bought the business over three decades ago, now advises newcomers to the industry on growing techniques and strategy. He believes you can’t succeed without helping others succeed. Both men attribute their success to hard work and years of practical business decisions.
In the years following the start of the recession, both men recalibrated to stay afloat while colleagues went out of business. “Most nurseries aren’t debt free,” says David. He and his wife worked diligently to stay out of debt which helped them survive in the years following the recession.
Larry infused income from other investments into his nursery and tapped into savings to save the business. “It woke me up...It was unbelievable” he says, “I had to deplete everything I had to keep this nursery.” He and his family adapted their business strategy and shifted focus from wholesale to retail. His kids helped develop the nursery’s website and social media presence which drew in new customers. He raised wages for workers twice since 2008 to help his employees who are also struggling.
Times are still tough. Watson's Nursery sales aren't half what they were in 2009, and David believes the nursery won't ever be what it was before the tornado. After a struggle with cancer, his wife Gaye died in August of last year. Were it not for his daughter, Amanda Jurisich, David would close the nursery. He doesn't believe the industry will improve, and the impact of the storms he's weathered over the last seven years is severe. But, Amanda wants to run the nursery and is optimistic. "I think it's going to be just fine," she says, "There's a real sense of pride here. The work and sacrifice that was put into this place is too much to let go."
Were it not for family, Larry Fish may have closed his nursery too. Though the cost of running the business has nearly doubled, Tarheel Nursery has only raised the price of their products 5 percent since the recession. Charging more for their retail would jeopardize their competitiveness with big box stores like Home Depot and Lowes. Despite this, Larry is determined to make business profitable again. His son-in-law Dusty Wilson, who has worked with him for 11 years, plans to take over the business. Larry says, "That's the man. That's how I'm looking at it now. I want him to do it, if he wants to do it."
The US Department of Agriculture's new figures on how the industry is fairing will be announced in December of this year. Corey Connor says that there is talk that business is picking up again as the housing market revives, particularly in Raleigh and Charlotte metro areas. Brian Whipker says the industry continues to consolidate. Large nursery and greenhouse operations are able to grow and sell more plants at a lower cost, and mom and pop business are being pushed out of the market. To survive, mid-sized operations must adapt and innovate to find niche markets for their products.
Both business owners are accustomed to innovation and know it’s essential for survival. Watson’s Nursery once had a garden center equipped with garden supplies and outdoor decorations that David closed when a nearby Lowe’s developed a garden center. His daughter plans to build the company’s online presence to draw in new customers. Larry knows his retail customers like speciality pots immediately ready for display after purchase, so he’s making more of them. Tarheel Nursery and Watson’s Nursery, like so many other small businesses, must adapt to survive in the new economy.
Larry Fish of Tarheel Nursery is hopeful. “I think this year, it might come back. It feels like a good year.”