American Nurseryman Magazine - Horticulture Magazine and Horticulture Books - Looking Back - January, 2014 - DEPARTMENTS

American Nurseryman Magazine - Horticulture Magazine and Horticulture Books - January, 2014

DEPARTMENTS

Looking Back

Fair prices for quality products. It's a perennial topic of debate in any industry, and commercial horticulture is no exception. Seems we're forever discussing the problem of discounted product - and how to fight discounters.

Sixty years ago, American Nurseryman editor and publisher F.R. Kilner addressed the subject in his regular column, which we've reprinted from the February 15, 1954, issue. His words ring true today:

Cut Prices

The approach of the spring gardening season is annually heralded by the appearance of catalogs, newspaper advertisements and radio announcements offering trees, shrubs, plants, bulbs and seeds at prices that appear ridiculously low to those who sell quality merchandise in those categories. The fact that the claims made in connection with the cut-price offers would mislead buyers into the assumption that they would receive quality merchandise only makes the lowness of the prices the less justifiable. Why is this approach employed in the selling of horticultural products?

The most that can be said by way of excuse is that such vendors are either not long experienced in this industry or they are misled by the success of mail order and other firms that operate on a basis of mass production and mass selling. Such vendors overlook the fact that nobody ever attained a million-dollar sales volume on low-priced merchandise in the horticulture field - though such large volume has indeed been attained by some firms that followed so-called legitimate methods of selling.

Another pertinent fact that such vendors overlook is that no one has continued in the sale of cut-rate merchandise in this field for more than a short few years except in a very small way, whereas there are many horticultural enterprises which have continued uninterruptedly in operation for decades, and some for more than a century, on the basis of selling quality merchandise at good prices.

The lesson may be that there is a place for five-and-dime stores and for cut-rate catalog firms in the sale of cheap hardware, notions and such merchandise which gives the public value for what it pays, but the public emphatically does not receive the value it expects when it pays a few cents for a package of bulbs or a few dimes for a rosebush or so-called tree. No doubt, the public has no right in that expectation when it pays absurdly low prices, but the public has not the trade's knowledge of the merchandise nor much conception of the trade's real standards of grades and quality.

On the cut-rate prices advertised there can be only an infinitesimal margin of profit, so that even if such a vendor should attain a large volume of sales, he would be poorly repaid for his efforts.

The margin of profit, however, is determined to some degree by the wholesale price paid for the merchandise thus resold. In some cases growers themselves are to blame for the dissatisfaction of the public because they are induced to sell in job lots at ridiculously low figures stock that should be burned, for it does more harm to the industry at large than it brings good into the pocketbook of the grower or anybody else.

Sometimes so-called legitimate operators, such as the growers described, think in temporary terms of cut prices, even while they decry the general employment of them by others. If all of us would adhere to the conception of satisfactory merchandise at satisfactory prices, sales volume would prosper and profits increase, while the public would be better served.