Nursery & Garden Stores in The US Industry Report

Nursery & Garden Stores in the USDecember 2015 1
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Nipped in the bud: Rising demand for garden

products will be captured by external competitors
IBISWorld Industry Report 44422
Nursery & Garden

Stores in the US
December 2015
Madeline Hurley
2 About this Industry
17 International Trade
29 Key Statistics
Industry Definition
18 Business Locations
29 Industry Data
Main Activities
Similar Industries
20 Competitive Landscape
Additional Resources
20 Market Share Concentration
29 Annual Change
20 Key Success Factors
4 Industry at a Glance
29 Key Ratios
30 Jargon & Glossary
20 Cost Structure Benchmarks

22 Basis of Competition
5 Industry Performance
23 Barriers to Entry
Executive Summary
24 Industry Globalization
Key External Drivers
Current Performance
Industry Outlook
11 Industry Life Cycle
25 Major Companies
26 Operating Conditions
26 Capital Intensity
13 Products & Markets
27 Technology & Systems
13 Supply Chains
27 Revenue Volatility
13 Products & Services
28 Regulation & Policy
14 Demand Determinants
28 Industry Assistance
15 Major Markets
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About this Industry

Industry Definition
Stores in this industry primarily retail a

broad range of nursery and garden products,
including trees, shrubs, plants, seeds, bulbs
and sod to households and the farming
community. This industry also includes
Main Activities
The primary activities of this industry are
stores that retail farm supplies such as

animal feed (excluding pet food). The
growing and retailing of nursery stock is
included in the Plant and Flower Growing
industry (IBISWorld report 11142).
Operating farm supply stores

Operating feed stores (except pet)
Operating garden centers
Operating lawn supply stores
Operating nursery and garden centers without tree production
The major products and services in this industry are
Chemicals
Equipment
Grain and animal feed
Plants
Tools and other supplies
Similar Industries
11142 Plant & Flower Growing in the US

This industry grows a variety of nursery products under cover or in open fields.
42382 Farm, Lawn & Garden Equipment Wholesaling in the US
This industry sells farm, lawn and garden equipment to retailers in the Nursery and Garden Stores industry.
42491 Farm Supplies Wholesaling in the US
This industry delivers supplies to retailers in the Nursery and Garden Stores industry.
42493 Flower & Nursery Stock Wholesaling in the US
This industry wholesales nursery and garden supplies to retailers.
44411 Home Improvement Stores in the US
This industry supplies a broad range of home repair and maintenance goods including lawn and garden
supplies.
44413 Hardware Stores in the US
This industry retails a broad range of home renovation equipment and supplies, including lawn and garden
tools and products.
56173 Landscaping Services in the US
This industry provides landscape design, care and maintenance services as well as lawn and garden
products.
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About this Industry
Additional Resources
For additional information on this industry

www.americanhort.org
AmericanHort
www.garden.org
National Gardening Association
www.pgta.org
Progressive Gardening Trade Association
IBISWorld
writes over 700 US

industry reports, which are updated
up to four times a year. To see all
reports, go towww.ibisworld.com
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Nursery & Garden Stores in the US December 2015
Industry at a Glance
Nursery & Garden Stores in 2015
Key Statistics
Snapshot
Revenue
Annual Growth 10-15
Annual Growth 15-20
Profit
Wages
Businesses
$40.2bn
4.5%
$1.3bn
$3.8bn
Per capita disposable income
Revenue vs. employment growth
% change
There are no major

players in this
industry
% change
Market Share
-4
-8
-12
Year 07
2.9%
19,349
1
0
-1
-2
09
Revenue
11
13
15
17
19
-3
Year
21
08
10
12
14
16
18
20
Employment
SOURCE: WWW.IBISWORLD.COM
p. 25
Products and services segmentation (2015)
4.0%
8.3%
Per capita disposable

income
Tools and other

supplies
Plants
External competition for

the Nursery & Garden
Stores industry
17.2%
Number of adults
aged 50 and older
Chemicals
51.4%
Private spending on
home improvements
Equipment
19.1%
p. 5

SOURCE:
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SOURCE:
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Industry Structure
Life Cycle Stage

Revenue Volatility
Capital Intensity
Mature
Low
Medium
Industry Assistance
None
Concentration Level
Low
FOR ADDITIONAL STATISTICS AND TIME SERIES SEE THE APPENDIX ON PAGE 29
Regulation Level
Light
Technology Change
Low
Barriers to Entry
Low
Industry Globalization
Low
Competition Level
High
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Industry Performance
Executive Summary | Key External Drivers | Current Performance

Industry Outlook | Life Cycle Stage
Executive
Summary
Over the past five years, the Nursery and

Garden stores industry has experienced a
blossoming recovery. The industry retails a
wide range of plants, seeds, bulbs and
gardening tools and equipment to
households, businesses and the farming
community. The strengthening consumer
segment has been largely responsible for the
industrys recovery, with per capita
disposable income and consumer
confidence steadily increasing over the
period. While heightened external
competition and the lingering effects of the
recession pushed some operators out of the
industry, the remaining stores have largely

been able to overcome the competitive
environment. As a result, over past five
years, industry revenue is expected to
increase at an annualized 4.5% to reach
$40.2 billion, including a 3.4% increase
in 2015.
External competition has been a looming
threat for the industry over the past five
years. Big-box stores such as Home Depot
and Orchard Supply Hardware have
absorbed a large portion of the demand for
industry products. These stores are able to
offer lower prices and a one-stop-shop
format. Superstores such as Target and

Walmart have also been a threat to
operators over the past five years. As
industry operators engaged in price
competition with these large companies,
profit margins have remained meager at
3.3%. Even so, profit has increased over the
five-year period from its low of 0.9% in
2010. As less profitable stores exited the
industry and demand increased
significantly, average industry profit
increased. Additionally, operators were
often able to make up for their higher prices
by offering more in-depth product
knowledge and superior customer service.
Over the next five years, the industry is
expected to continue its upward climb as the
economy strengthens. However, revenue
growth is expected to be more modest than
the previous five-year period as the
competitive environment heats up. Profit
is expected to decrease slightly as price
competition and increased wage costs eat
away at margins. Despite these
difficulties, the industry is expected to
grow from rising popularity of ecofriendly products and gardening
methods. The industry is also expected to
benefit from a growing millennial
demographic interested in gardening and
organic produce. As a result, over the five
years to 2020, revenue is expected to
increase at an annualized 2.9% to reach
$46.4 billion.

When household income levels
increase, consumers are able to afford
better quality and a larger range of
nursery stock. On the other hand, a
contraction in income levels causes
consumers to defer purchases of these
products because they are nonessential.
Per capita disposable income is
expected to increase in 2015, creating a
potential opportunity for the industry.
External competition for the

Nursery & Garden Stores industry
Competition from other retailers, such as
home improvement stores, is likely to
attract consumers dollars away from
dedicated nursery and garden stores.
For instance, aggressive price
competition from home centers that
sell garden products has siphoned
revenue from industry establishments.
External competition is expected to
Increased
external competition has put strain

on industry profit margin
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increase in 2015, posing a potential

threat to the industry.
Number of adults aged 50 and older
Individuals aged 50 and older
represent the largest customer group of
the Nursery and Garden Stores
industry. The number of adults aged 50
or older is expected to increase in 2015.
Nevertheless, the growth rate of the
50-and-over demographic is expected
to slow over the five years to 2020,
hampering demand for the Nursery
and Garden Stores industry.
Private spending on
home improvements
Consumer spending on home
improvements tends to boost demand
for nursery and garden stores
products. The combination of slow
home sales (along with a large
number of foreclosures) and low
disposable income levels reduced the
average amount spent on home
improvements over the past five
years. Private spending on home
improvements is expected to increase
in 2015.
Number of adults aged 50 and older

3
3.0
2.5
% change
% change

continued
0
-1
1.5
-2
-3
Year
2.0
08
10
12
14
16
18
20
1.0
Year
08
10
12
14
16
18
20
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Current
Performance
Blossoming demand
The Nursery and Garden stores industry has

experienced a flourishing recovery over the
past five years. Industry operators sell a
variety of products including trees, shrubs,
plants, seeds, bulbs, fertilizer and gardening
tools to households, farmers and businesses.
Rising per capita disposable income and
increased private spending on home
improvements helped the industry grow
after its significant decline during the
recession. Improving economic conditions
allowed the industry to expand at an
annualized 4.5% over the five years to 2015.
This includes a 3.4% jump in 2015, bringing
overall revenue to $40.2 billion.
% change
The strengthening household market has

significantly impacted the industrys
recovery over the past five years. In 2015,
households are expected to generate about
82.0% of industry revenue. Rising per capita
disposable income and falling
unemployment have boosted consumer
spending at an annualized 2.2% over the
past five years. This has benefited the
industry, with consumers spending more on
enhancing the aesthetics of their home and
garden. During the recession, many
consumers put off remodeling and other
home improvements in order to save
money. As the economy recovered,
consumers released their pent up demand
by engaging in a variety of remodeling
projects. Over the five years to 2015,
demand from remodeling increased at an
average annual rate of 7.7%, thereby
boosting demand for industry goods.
Strong performance from the housing
market also benefitted industry operators.
Over the past five years, existing home sales
increased at an average annual rate of 4.8%.
When consumers put their houses on the
market, they usually engage in a variety of

improvements to make their property more
attractive to buyers. These improvements
can also boost the value of properties,
further enticing sellers to enhance their
homes and yards. These can be major
renovations or minor cosmetic changes such
as painting the homes exterior or planting
new trees and shrubs. As more consumers
enhanced their properties to sell, industry
operators experienced an influx of demand.
While consumers are the largest
contributor to the industrys recovery,
corporate entities have also been a strong
market for nursery and garden stores.
Businesses use a variety of industry products
to maintain and enhance their facilities.
While cosmetic improvements are not
necessary to business operations, many
companies make minor aesthetic
improvements to entice clientele. Over the
past five years, with corporate profit
increasing at an annualized 3.8%,
businesses have been able to spend more on
these enhancements, thereby boosting
industry revenue.
Industry revenue
8
4
0
-4
-8
-12
Year 07
09
11
13
15
17
19
21
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Competitive
environment
Although the industry has experienced

sizable recovery from the adverse effects of
the recession, heightened competition
remains a threat to operators. Even before
the recession, nurseries and garden stores
faced mounting competition from
alternative retailers, including home
improvement stores, such as the Home
Depot and Lowes, and mass merchandisers
such as Walmart and Target. These retailers
ability to determine the prevailing market
price for nursery and garden store goods by
sourcing products at lower costs and passing
on savings to customers through lower
prices has pulled consumers away from local
shops. The average consumers declining
leisure time has also made the one-stopshop format of alternative retailers even
more attractive.
Price competition is a defining trait of the
Nursery and Garden Stores industry, leaving
little room for retailers to earn profit. When
input prices increase, nurseries and garden
centers have to absorb costs because price
increases will often send consumers to
nonindustry retailers, such as the Home
Depot and Walmart. These big-box stores
are particularly threatening during times of
low demand. For instance, in 2010 when the
hostile effects of the recession still lingered,
average industry profit plunged to 0.9%.
Due to their scale, large external operators
Despite
economic recovery,
external competition
threatened revenue
were able to provide more cost savings to
consumers, bringing them away from small
industry operators. As a result, many
industry operators had to scale down their
operations or exit the industry entirely. Over
the five years to 2015, the number of nursery
and garden stores is expected to decrease at
an annualized 0.4% to 22,390 locations.
With fewer unprofitable operators and
improving demand, average industry profit
began to pick up. While competitive
pressures still kept margins low, the
remaining operators were able to improve
margins to an estimated 3.3% in 2015.
Because of their small size and local appeal,
nursery and garden stores have been able to
differentiate themselves from larger external
competitors. Industry operators have put an
emphasis on personalized service in order to
compensate for their typically higher prices.
In order to do this, industry operators have
increased their workforce. Despite a decline
in establishments, surging demand has
caused industry employment to rise at an
annualized 0.4% to 134,928 workers over
the five years to 2015.
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Industry
Outlook
Over the next five years, the Nursery and

Garden Stores industry is expected to
continue its upward climb. Increasing
consumer spending and continued
strength within the housing and
construction markets are expected to
bolster demand for industry goods. Even
so, heightened competition from external
operators is expected to threaten industry
New sources of
demand
Traditionally, consumers over age 55 have

been the largest market for nursery and
garden products. These retirement-aged
individuals typically have more free time
and take up hobbies like gardening. In the
five years to 2020, the number of adults
aged 50 and older is expected to rise at an
average annual 1.6%, compared with a rate
of 2.2% in the previous five-year period.
Although this age group will remain the
driving market of industry demand, other
demographics are expected to generate
more growth for the industry in the coming
years. According to The National
Gardening Association, the number of
home gardeners aged 18 to 34 increased
63.0% between 2008 and 2013 (latest data
available). Although this group has a low
level of homeownership, the growing
popularity of community and urban
gardens have enticed a slew of young
gardeners. This trend is also driven by
Millennials preference toward organic and
locally grown foods. According to the
Boston Consulting Group, Millennials are
two times more likely to buy organic
produce than other generations. These
preferences have enticed many Millennials
to take up growing produce themselves.
With the number of Millennials expected to
exceed the number of Baby Boomers in
2015, the rise of gardening within this
demographic is expected to drive industry
demand into the future.
operators. As big-box stores continue to

offer lower prices, industry operators will
need to strengthen their position within
their local communities in order to
compete. Due to the competitive
environment, industry revenue is expected
to rise less rapidly than the previous
period, increasing at an annualized 2.9%
to reach $46.4 billion by 2020.
Millennials
are two times

more likely to buy organic
produce than other
generations
Over the next five years, a shift toward
environmentally friendly gardening
practices will also benefit industry operators.
With numerous droughts and fires, along
with an overall cultural shift toward
sustainability, environmentally friendly
products are expected to drive demand in
the five years to 2020. According to
Greenhouse Management, gardening
homeowners are 25.0% more likely to pay
more for eco-friendly gardening products.
These products include mulch, efficient
irrigation systems, biopesticides and
composting equipment. These items
generally earn higher margins and will
benefit operators whose profit has been
hampered by price competition. Focusing
on these products will allow many industry
operators to differentiate themselves from
big-box stores. While many of these
products are available through external
competitors, others are more niche and
difficult to find. Over the next five years,
environmental concerns are expected to
continually drive consumer purchases,
bolstering demand for industry goods.
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Profit and
participation
Over the next five years, external

competition is expected to hamper
profit growth. In the years to 2020,
average industry profit is expected to
decrease slightly to 3.2%. Industry
operators are expected to engage in
price competition with big-box stores
in order to attract customers, therefore
reducing margins. Industry operators
will also compete with external
operators using customer service. By
hiring quality employees, industry
operators will attempt to retain
existing customers and establish
relationships in the local community.
Over the next five years, as operators
focus on a skilled workforce, wages are
expected to increase at an annualized
To
gain a competitive edge,

garden stores will hire
skilled workers to develop
exclusive plants
2.2% to reach $4.3 billion. These
heightened wage costs will also put
downward pressure on profit margins.
Low profit margins and increased
competition will deter many new
companies from entering the industry.
Because of this, the number of
industry operators is expected to
increase at a sluggish 0.5% to reach
19,874 enterprises by 2020.
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Life Cycle Stage
The industry has recovered in line

with the overall economy
Industry products are accepted wholeheartedly
% Growth in share of economy
Product groups are clearly segmented and stable
20
Maturity
Quality Growth
Company
consolidation;
level of economic
importance stable
High growth in economic

importance; weaker companies
close down; developed
technology and markets
15
Key Features of a Mature Industry

Revenue grows at same pace as economy
Company numbers stabilize; M&A stage
Established technology & processes
Total market acceptance of product & brand
Rationalization of low margin products & brands
10
Quantity Growth
Many new companies;

minor growth in economic
importance; substantial
technology change
Pesticide Manufacturing
Bed & Breakfast & Hostel Accommodations
Nursery & Garden Stores
Farm, Lawn & Garden Equipment Wholesaling

Florists
Plant & Flower Growing
Decline
-5
Shrinking economic
importance
-10
-10
-5
10
15
20
% Growth in number of establishments

SOURCE: WWW.IBISWORLD.COM.AU
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Industry Life Cycle

This
industry
is M
ature
The Nursery and Garden Stores industry

is in the mature stage of its life cycle.
Industry value added (IVA), which
measures an industrys contribution to
GDP, is increasing over the 10 years to
2020 at an average annual rate of 3.1%,
while GDP grows at an average annual
rate of 2.2% over the same period. While
IVA growth higher than GDP generally
indicates a growing industry, such rapid
growth from nursery and garden stores
has been caused by sizable recovery from
recessionary lows.
The Nursery and Garden Stores
industry exhibits a variety of
characteristics indicative of its maturity.

Industry products are generally
homogenous and are accepted
wholeheartedly by consumers.
Additionally, an intense competitive
environment and market saturation has
driven a variety of mergers and
acquisitions. For example, Armstrong
Garden Center, the industrys largest
company, acquired Pike Nurseries. While
the industry still remains highly
fragmented, with no single company
accounting for more than 5.0% of
industry revenue, consolidation activity
has increased over the past five years.
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Products & Markets
Supply Chain | Products & Services | Demand Determinants

Major Markets | International Trade | Business Locations
Supply Chain
KEY BUYING INDUSTRIES

45311
Florists in the US
This industry purchases nursery and garden products for resale to the end consumer.
72119
Bed & Breakfast & Hostel Accommodations in the US

This industry purchases nursery and garden products to be used on the lodgings grounds.
81399
Homeowners Associations in the US

This industry purchases nursery and garden products to be used on the subdivisions grounds.
81411
Maids, Nannies & Gardeners in the US

This industry includes gardeners who purchase nursery and garden products to be used on the
grounds of private homes.
99
Consumers in the US
Households are the primary consumers of product purchases at nursery and garden stores.
KEY SELLING INDUSTRIES
Products & Services
11142
Plant & Flower Growing in the US

Farmers sell seeds and plants to industry operators.
32532
Pesticide Manufacturing in the US

This industry uses pesticides to reduce insect damage to nursery crops.
42382
Farm, Lawn & Garden Equipment Wholesaling in the US

This industry comprises establishments primarily engaged in wholesaling specialized
machinery, equipment and related parts generally used in agricultural, farm and lawn and
garden activities
42491
Farm Supplies Wholesaling in the US

This industry comprises establishments primarily engaged in wholesaling farm supplies such as
animal feeds, fertilizer, agricultural chemicals, pesticides, plant seeds and plant bulbs.
42493
Flower & Nursery Stock Wholesaling in the US

This industry comprises establishments primarily engaged in wholesaling flowers, florists
supplies and nursery stock (except seeds and plant bulbs).
Equipment
Industry operators primarily sell farm
and garden equipment, including lawn
mowers, leaf blowers and chainsaws. This
product category is expected to account
for 50.0% of revenue in 2015, down from
its level in 2010. In the five years to 2015,
demand for these products has fallen as
the level of homeownership (and
therefore, gardens) has decreased.
Homeownership has dropped each of the
past five years with an expected 51.4% of
Americans owning their homes in 2015.
Additionally, farm and garden
equipment is high-priced and requires a
substantial investment. This has
discouraged greater sales of these
products in recent years.

Grain and animal feed make up the secondlargest product category, accounting for an
estimated 19.1% of industry revenue. Grain
prices skyrocketed in 2011 due to global
shortages and very strong demand from
developing economies. This created feed
shortages as well, with the price nearly
doubling. However, since 2013, grain and
feed prices have stabilized and even fallen as
supply has outstripped demand. In the five
years to 2015, grain and feeds portion of
revenue increased slightly but will fall over
the next five years.
Chemicals
Chemicals and propagative supplies,
including fertilizer, lime and soil treatments,
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Products & Markets
Products & Services

continued
Products and services segmentation (2015)
4.0%
8.3%
Plants
Tools and
other supplies
17.2%
Chemicals
51.4%
Equipment
19.1%
Total $40.2bn
account for an estimated 17.2% of industry
revenue in 2015. This segments most
commonly sold product is fertilizer, the cost
of which fluctuates with the price of crude
oil and natural gas. The price of these inputs
increased dramatically during the earlier
part of the past five years. Nevertheless, the
shale gas boom in the United States has
brought prices down dramatically in recent
years. This segment is expected to shrink in
2015 alongside falling oil and gas prices.
Demand
Determinants
items has subsided substantially. Plants are

discretionary goods that are very sensitive to
changes in disposable income. Additionally,
the decline in homeownership decreased the
number of gardens that require tending.
Plants
Plants for indoor and outdoor use account
for an estimated 8.3% of industry revenue.
Cut flowers, shrubs, trees and bedding
plants (which are primarily used for
displays) are all categorized in this segment.
Over the past five years, demand for these
Tools and other supplies

Tools and other products make up 4.0% of
the industrys revenue. This category
includes hardware, electrical supplies, lawn
and garden tools and spare equipment
parts. Sales of tools have increased slightly
during the past five years as consumers have
turned to do-it-yourself home projects
instead of hiring professionals to complete
such jobs. Other products also included in
this industry are lumber materials and
paint, which represent a relatively stable yet
insignificant portion of industry revenue.
Changes in purchasing power (namely

disposable income), price, home
construction, remodeling activities and
seasonality influence demand for nursery
and garden centers.
The level of household disposable income
is crucial to all retailers, as significant
changes can dramatically influence sales.
The level of household disposable income
affects the quantity, quality and timing of
nursery and garden store purchases. For

instance, during periods of economic
uncertainty, which includes low income
growth and labor market weaknesses,
consumers are more inclined to save rather
than spend, opting instead to allocate
income toward more necessary expenses
such as food and utilities. Alternatively,
when they do purchase industry goods,
consumers opt to purchase less costly
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Products & Markets
Demand
Determinants
continued
variations of nursery and garden products.

Demand for nursery and garden stock was
particularly strong during the housing
boom; however, the severe economic
downturn significantly reduced purchasing
power and demand. Rising disposable
income since the recovery has helped
mitigate the industrys decline in
recent years.
Price is also a significant consideration
when shopping for nursery and garden stock
and supplies. Budget-constrained
consumers choose lower-priced goods or
limit the number of purchases they make.
Increasing prices are easier to swallow
during an economic boom, but a long
economic recovery period and a high rate of
long-term unemployment will reduce
consumer demand. With so many retailing
channels to choose from, consumers are
shopping around for the best price more
than ever. Traditional home improvement
and hardware stores stock some nursery
and garden merchandise, as do
supermarkets and big-box retailers, leading
more consumers to purchase industry
products from these outlets instead of
nursery and garden stores.
The prevalence of home construction is
another demand determinant for industry
products. Nursery and garden store
products are typically used to create a
completed picture-perfect look for homes.
Therefore, as new home construction
increases, so does demand for gardening,
which in turn increases industry revenue.

However, home starts are reactive to
available government subsidies, home prices
and credit conditions. The subprime
mortgage crisis led to a rise in the number of
foreclosed homes and tight restrictions on
credit. However, over the past five years,
housing starts are expected to grow an
annualized 14.6%. With more homes being
built, demand for nursery and garden
products has risen, tempering declines in
industry revenue.
Home remodeling also plays a role in
determining demand for nursery and
garden supplies. Households tend to put off
home improvement projects during times of
low consumer confidence and disposable
income, saving available funds for necessary
expenses. Similar to new home
construction, spending on home
improvement renovations and alterations
has increased slowly, leading to an
increase in industry purchases.
Demand for plants, shrubs and flowers is
further influenced by the seasons of the
year. For instance, during October and
November, consumers demand spring
bedding plants (e.g. wallflowers, primroses,
forget-me-nots) while in March and April
consumers are likely to demand containergrown conifers, shrubs and some varieties of
annual flower seeds. About 40.0% of
nursery sales occur in the third quarter of
the year (in fact, it is industry player
Calloways Nurserys best quarter).
Major Markets
Consumers aged 55 and older

Households account for the largest
portion of spending at nursery and
garden stores at about 82.0% of revenue.
Consumers aged 55 years and older make
up for the largest portion of revenue out
of the household segment. Many
consumers in this demographic are of
retirement age and have more time to
dedicate to hobbies such as gardening
and other DIY (do-it-yourself) projects.
Additionally, according to the Census,

this groups home ownership rate is
about 80.0%. This means that many of
these consumers have a yard or lawn to
maintain or landscape. Over the past five
years, this segments share of revenue has
remained stagnant as despite the number
of individuals in this group rising. In
2015, this age group is expected to
account for about 29.5% of overall
industry revenue.
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Products & Markets
Major Markets
continued
Major market segmentation (2015)
8.0%
10.0%
Corporate
entities
Farmers
29.5%
Consumers aged 55 and older
25.4%
Consumers aged 34 and younger
27.1%
Consumers aged 35 to 54
Total $40.2bn
Consumers aged 35 to 54
Consumers aged 35 to 54 represent the
second largest segment for industry
operators. IBISWorld estimates that 27.1%
of industry revenue is generated by this
client base. Gardening is a pastime growing
in popularity among these Americans and
the aging population is expanding the size of
this demographic. Homeownership in this
age group is high at about 70.0%. Even so,
this groups share of revenue has decreased
slightly over the past five years due to
decreased time. As unemployment
decreased, individuals of prime working age
had less time to spend on hobbies and
leisure. Additionally, as per capita
disposable income increased, many of these
individuals hired third-party gardeners and
landscapers to maintain their residences.
Consumers aged 34 and younger
Consumers under the age of 34 represent
the smallest consumer segment for the
Nursery and Garden stores industry. With
only 34.0% classified as homeowners, this
group demands fewer industry goods to
maintain their properties. Even so, over the
past five years, this demographic has
become increasingly important. According
to the National Gardening Association, the
number of individuals in this age group who
have grown food gardens has increased
63.0% between 2008 and 2013 (latest data

available). As a result, this groups share
of revenue has increased over the past
five years.
Farmers
Farmers account for an estimated 10.0% of
revenue. Demand from this segment
fluctuates year-on-year, largely depending
on unpredictable weather patterns. If a flood
or drought diminishes farmers outputs in a
given year, they are likely to substitute their
crops and propagative materials (live plant
materials used to produce new plants) with
store-bought items. Additionally, many
farmers purchase their lawn and garden
goods in bulk from wholesalers or
manufacturers. Over the past few years,
this segment has decreased slightly as
farmers increasingly turn to wholesalers
and manufacturers in order to cut costs.
In 2014 and 2015 specifically, decreased
farm income has made farmers much
more price sensitive.
Corporate entities
Corporate clients account for about 8.0% of
revenue. Businesses purchase flowers and
plants to use as decorations in offices and
outside of buildings. Over the past five years,
this market segment has increased as a
share of revenue. Many businesses use
WWW.IBISWORLD.COM
Products & Markets
Major Markets
continued
industry goods to enhance the

aesthetics of their facilities. With
corporate profit on the rise, businesses
have been able to spend more money on

discretionary goods like decorations
and ornamental plants.
International Trade
The trade data for nursery stock and

equipment and supplies is recorded at the
growing and manufacturing level. However,
nursery and garden stores sell imported
products in the domestic market. The
availability and price of imports places
downward price pressure on nursery and
garden stores, which limits revenue and

profit growth. Over the past five years,
import values have increased as a share of
domestic demand in the upstream Plant and
Flower Growing industry (IBISWorld report
11142), currently accounting for about 12.7%
of the industrys domestic demand.
WWW.IBISWORLD.COM
Products & Markets

Business Locations 2015
West
New
England
AK
0.1
Great
Lakes
WA
ND
MT
2.6
Rocky
Mountains
ID
OR
1.8
West NV
0.4
2.5
SD
0.7
WY
0.8
MN
0.7
0.9
Plains
CO
0.6
KY
1.7
OK
2.0
NC
3.1
TN
AZ
NM
1.2
0.6
Southwest
TX
7.9
HI
0.3
Additional States (as marked on map)

1 VT
2 NH
3 MA
4 RI
5 CT
6 NJ
7 DE
8 MD
0.5
1.1
0.7
2.0
1.6
0.4
SC
Southeast
1.5
MS
AL
2.0
1.6
GA
2.7
1.4
LA
1.5
FL
4.0
Establishments (%)
0.4
1.2
AR
0.7
2.4
7.2
WV VA
2.5
2.3
3.9
CA
West
3.8
MO
KS
2.2
OH
2.5
3.0
4.0
IN
IL
1.8
UT
PA
3.2
2.3
0.6
1 2
3
NY
4.0
5 4
MI
2.6
IA
NE
0.3
WI
ME
MidAtlantic
9 DC
0.0
Less than 3%
3% to less than 10%
10% to less than 20%
20% or more
WWW.IBISWORLD.COM
Products & Markets
Distribution of establishments vs. population

30
20
10
Southwest
Southeast
Plains
New England
Rocky Mountains
Establishments
Mid-Atlantic
Great Lakes
0
West
Industry establishments are located

throughout the United States. However,
their distribution varies slightly from the
population distribution. The industry is
largely concentrated in the Southeast region,
which accounts for 25.7% of total
establishments. This region houses 25.4% of
the population as well, which indicates that
nursery and garden centers are located near
dense population pockets. The Southeast
region generally experiences mild winters,
making it a prime area for year-round
gardening. Florida accounts for the most
significant share of both population and
industry presence in this region; the states
several large cities are hubs for consumer
activity. Over the past five years, this
regions proportion of establishments has
remained relatively constant.
The Great Lakes and Plains regions are
home to 15.2% and 13.7% of industry
establishments, respectively. Both regions
have kept their share of stores over the past
five years. The Great Lakes region accounts
for 14.9% of the population, which explains
the proportion of retailers in this area. Only
6.6% of the population is situated in the
Plains, however, which is significantly lower
than the proportion of nursery centers. This
is due to the availability of nursery stock in
this region, as the climate and flat land of
this area are suitable for agriculture.
Business Locations
Population
Conversely, the Mid-Atlantic region is

home to 15.5% of the population and only
11.7% of industry establishments. The
population is very dense and people have
less available space to develop gardens and
grow plants and trees. The number of
establishments in other regions is closely
proportional to the population distribution
and there have been no major changes in
locations over the past five years. Texas is
home to the most nursery and garden
stores, accounting for 7.9% of the total.
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20
Competitive Landscape
Market Share Concentration | Key Success Factors | Cost Structure Benchmarks

Basis of Competition | Barriers to Entry | Industry Globalization
Market Share
Concentration
Level
Concentration
in
this industry is L ow
Key Success Factors

IBISWorld
identifies
250 Key Success
Factors for a
business. The most
important for this
industry are:

is highly fragmented, with a low level of
market share concentration. Nearly
90.0% of companies employ fewer than
20 people, indicating the small scale of
the average operation. The industry is
home to many area-specific retailers that
service only a specified geographic
market. Also, low barriers to entry enable
family-owned and -operated stores to
dominate. Additionally, over one-third of
industry operators are classified as
nonemployers, meaning the company is
owner operated with no paid employees.
As a result, no single company holds a
significant share of the market.
Having a clear market position

A clear market position enables operators to
emphasize their area of expertise (e.g. rose
nurseries) and differentiate themselves from
their competition.
Ability to control stock on hand
Effective stock control enables operators
to reduce inventory costs and increase
stock turnover.
Experienced work force
Knowledgeable and expert experienced
employees are more capable of addressing
consumer questions and assisting with the
purchase of plants and shrubs for specific
locations and climates.
Cost Structure
Benchmarks
Profit
Industry profit, measured as earnings before
interest and taxes, is estimated to account
for 3.3% of revenue in 2015, increasing
significantly over the past five years from
0.9% in 2010. Profitability suffered as a
result of the recession and nursery and
garden store operators were not able to cut
capacity quickly enough to respond to the
drop in demand. Profit has largely recovered
Establishment by employment size

No. of employees
0 to 4
10 to 19
20 to 99
100 +
Share (%)
44.6
21.0
10.1
1.1
SOURCE: US CENSUS BUREAU
Additionally, the increasing external

competition from alternative garden
supply retailers, such as home
improvement stores and mass
merchandisers, is forcing small nursery
and garden stores out of this industry.
Attractive product presentation

Displaying products in an appealing
manner provokes impulse purchases
among customers.
Having links with suppliers
Having a strong relationship with an
established and reliable supplier
ensures that products are high quality
and the operator can expect a steady
supply of products.
Proximity to key markets
Industry operators can maximize their
exposure to consumers by making
sure they are located in close
proximity to key markets.
since then, as construction and home sales

have picked up. The exit of many
unprofitable operators also boosted
margins. Profit has also been aided by a
decrease in the price of key inputs, such as
fertilizer, for the first time in four years.
Purchases
Purchases are the largest expense category
for nursery and garden centers at an
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21
estimated 66.6% of industry revenue.

Retailers purchase these items from
upstream wholesalers or manufacturers and
resell them to final consumers. The range of
suppliers depends on each operator;
industry operator Armstrong Garden
Centers, for instance, grows much of its
stock on-site. As commodity prices
fluctuated during the past few years, the
price of fertilizers, feed and other products
increased, causing purchase costs to rise. In
particular, rising fuel costs (a key input
into fertilizer), led the price of fertilizer to
jump from 2011 to 2013. Nevertheless,
purchasing costs have come down since
the price of feed, seed and fertilizer began
falling in 2014.
Wages
Garden centers are relatively labor
intensive. Wages account for an
estimated 9.6% of industry revenue in
2015, down from 11.9% in 2010. Wages
have remained stagnant during the past

five years as operators have attempted to
cut costs to retain margins during
periods of exceptionally high purchasing
costs. High external competition has
also encouraged operators to forego
giving their employees raises, in order to
save margins. In turn, the average
industry salary has fallen slightly over
the past five years from $29,010 in 2010
to $28,475 in 2015.
Rent
Rent and utilities represent an
estimated 2.9% of revenue. Most
garden centers lease their premises.
Even so, the majority of industry
stores are small and do not require
extensive storage or warehouse space,
keeping rent costs low. Additionally,
the majority of operators are located
outside of city centers where rent costs
are much higher.
Sector vs. Industry Costs

Average Costs of
all Industries in
sector (2015)
Industry Costs
(2015)
3.2
8.8
3.3
9.6
71.7
66.6
100
80
Percentage of revenue
Cost Structure
Benchmarks
continued
60
n Profit
n Wages
n Purchases
n Depreciation
n Marketing
n Rent & Utilities
n Other
40
20
0.8
4.6
9.1
1.8
1.3
2.9 1.3
15.0
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22
Cost Structure
Benchmarks
continued
Other
Capital expenditure is relatively limited, as
nursery and garden centers require very
few assets, most of which are of low value.
As a result, depreciation only accounts for
1.3% of industry revenue. To remain
competitive, operators are increasing their
capital expenditure in equipment
necessary for new product types (e.g.
organic plants) and updated information
systems to keep prices, retail models and
knowledge current, which has led
depreciation costs to rise over the past

five years.
Other expenses include interest,
insurance, advertising, distribution and
administrative costs, comprising a
combined 15.0% of industry revenue. As
competition increases, so do advertising
costs. While most garden centers operate
on a local level, mounting competition
from alternative outlets has increased
the need for brand awareness and
advertising campaigns.
Basis of Competition
Internal competition
The level of competition in the Nursery and
Garden Stores industry is intense. Industry
participants compete against each other on
price, range and quality of products and
additional services. Over the past five years,
the discretionary dollar has become highly
sought-after, making product and service
differentiation very important among
players. In addition, alternative outlets such
as home improvement stores (e.g. the Home
Depot) and mass merchandisers (e.g.
Walmart) have encroached upon the
industrys territory.
Internally, nursery and garden centers
compete on price. Many of the products sold
through these retailers are homogeneous;
therefore, the retailer that can offer the most
competitive price to its consumers gains
their business. Due to consumers weak
purchasing power over the past five years,
industry operators have become even more
aware of this competitive factor.
In addition to price, the range and quality
of plants and equipment are important. The
convenience of a one-stop shop makes a
retailer attractive to time- and moneystrapped consumers. Consumers value the
ability to purchase all their gardening
supplies in one location while comparing
prices to get the best deal available.
Additionally, retailers that stock high
quality merchandise create a base of
loyal customers.
Over the past five years, customer service

has also become a prominent factor in
attracting customers. Savvy consumers
recognize when knowledgeable and expert
gardening professionals are on hand to offer
tips and advice on products and techniques.
A garden center that sells supplies without
offering professional expertise may lose out
on customer business. Other factors that
garden and nursery stores consider include
product presentation, location and ease of
store access.
Level & Trend

ompetition
C
in
this industry is
Highand the trend
is I ncreasing
External competition
Over the past five years, external
competitors have diversified their offerings
to include nursery and garden products.
Home improvement stores, such as the
Home Depot and Lowes, and mass
merchandisers, such as Walmart and
Target, have dedicated square footage to
garden centers. These retailers pose a threat
because of their ability to source at lower
costs and determine the prevailing market
price for these goods. Additionally,
consumers are largely familiar with these
stores brands and feel comfortable with the
range and quality of products they supply.
These retailers also facilitate consumer
efficiency, offering a one-stop shopping
experience, combining gardening and
other household good purchases in one
location. When disposable incomes
were low during the recession,
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23
Basis of Competition
continued
consumers turned to these retailers to

save money.
Industry operators have also faced
increasing competition from online retailers.
These competitors benefit from not having
to pay or maintain store space for the
products. They also often provide customers
with additional services such as delivery. In
recent years, online operators, such as
Barriers to Entry
Opening a retail outlet is fairly

straightforward, with no formidable barriers
to entry. Low industry concentration also
suggests that no single player dominates the
market. The low level of market dominance
held by key players in an industry makes it
easier for new entrants to develop and
attract consumers. This should act as an
incentive to new players planning to enter
this industry.
Like most retail industries, operators in
this industry are subject to a low level of
capital intensity as the majority of
operational costs are devoted to the
payment of wages as opposed to capital
expenditure. Nevertheless, prospective
entrants still need to consider the capital
requirements of establishing a new store or
purchasing an existing location.
The market is flooded with companies
with little product differentiation. Nurseries,
home centers, hardware stores and discount
warehouses can retail pots of plants, shovels
and other related accessories. Therefore,
products sold by this industry are largely the
same across most nursery and garden center
stores, leading to competitive prices. A
Level & Trend

arriers to Entry
B
in this industry are

Lowand S
teady
1800flowers.com, have also expanded their

product offerings to generate additional
revenue. E-commerce operators tend to
focus on offering gift baskets and food,
flowers, cards and balloons for special
occasions. Like home improvement stores
and mass merchandisers, these operators
provide customers with an added level of
convenience that has proven popular.
Barriers to Entry checklist

Competition
Concentration
Life Cycle Stage
Capital Intensity
Technology Change
Regulation & Policy
Industry Assistance
High
Low
Mature
Medium
Low
Light
None
successful entrant may need to differentiate

itself from the entire market, either by
product type, price, retail model or even
product knowledge and expertise.
The existence of networks between
operators and suppliers may also, in some
cases, be viewed as a barrier to entry.
Existing operators may benefit from the
relationship they have established with
suppliers over time. An example of a
supplier/wholesaler is Color Spot
Nurseries, which produces more than
2,500 plant varieties and supplies over
2,000 retailers, including Walmart and
the Home Depot.
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24
Industry
Globalization
Level & Trend
lobalization
G
in this
industry is L owand
the trend is S
teady
This industrys nurseries and garden

centers are domestically owned and
operated. The extent to which the industry
operates on a global scale is low. However,
data indicates that this industry has
sourced a modest amount of imported lawn

and garden equipment in recent years.
Regardless, the level of globalization in this
industry is low and is forecast to remain so
over the five years to 2020.
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Major Companies
There are no Major Players in this industry | Other Companies
Other Companies

is highly fragmented and characterized
by a large number of small operators. In
2015, nearly 90.0% of industry
operators employ fewer than 20 people
and no retailer represents a significant
share of the market. The following
operators exemplify the typical
industry participant.
Armstrong Garden Center
Estimated market share: Less than 1.0%

Armstrong Garden Center commenced
operations in 1889 and is headquartered
in Glendora, CA. The company, which is
fully employee-owned, currently operates
48 retail outlets across California with
about 700 workers. The company grows
what it sells, with over 100 acres of
growing grounds and green houses. The
company stocks shrubs, plants and
garden supplies while priding itself on its
extensive rose catalog. The garden center
also owns and operates Pike Nurseries,
with 16 retail outlets in Georgia and
North Carolina. According to Garden

Center Magazine, over the past five years,
the company has maintained its status as
the nations largest independent garden
retailer. IBISWorld estimates that total
revenue for Armstrong Garden Center
will be $267.6 million in 2015.
Calloways Nursery
Estimated market share: Less than 1.0%

Established in 1987, Calloways Nursery
is a private Texas-based company. It
operates through 17 Dallas and Fort
Worth locations and one Houston
location. Calloways supplies bedding
plants, nursery stock and a variety of
other garden necessities. The company
provides specialized customer service
through its certified nursery
professionals. Much like the rest of the
industry, Calloways operates in a small
geographic region, catering to local
customers. IBISWorld estimates
Calloways will generate $49.7 million in
revenue in 2015.
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Operating Conditions
Capital Intensity | Technology & Systems | Revenue Volatility

Regulation & Policy | Industry Assistance
Capital Intensity
Level
The level
of capital
intensity is M
edium

has a moderate level of capital intensity.
IBISWorld estimates that for every dollar
spent on wages, industry operators will
invest $0.13 in capital. Capital investment is
mainly in the use of sprinkler systems,
greenhouses and humidity controls.
Since the recession, companies delayed
upgrading their greenhouses and
control systems in an effort to cut
operating expenses. Lower depreciatory
costs have also been due to a decline in
the number of industry establishments,
which has fallen at an annualized rate
of 0.4% over the past five years, despite
increasing revenue.
Capital intensity is expected to
decrease in the coming years as
industry employment and wages are
Capital intensity
Capital units per labor unit

0.5
0.4
0.3
0.2
0.1
0.0
Economy
Retail Trade
Nursery &
Garden Stores
Dotted line shows a high level of capital intensity

expected to rise. Currently, labor is

required to tend to nursery and garden
stock. However, as technology
Tools of the Trade: Growth Strategies for Success

Investment Economy
Recreation, Personal Services,

Health and Education. Firms
benefit from personal wealth so
stable macroeconomic conditions
are imperative. Brand awareness
and niche labor skills are key to
product differentiation.
Information, Communications,
Mining, Finance and Real
Estate. To increase revenue
firms need superior debt
management, a stable
macroeconomic environment
and a sound investment plan.
Pesticide Manufacturing
Farm, Lawn & Garden

Equipment Wholesaling
Florists
Traditional Service Economy
Wholesale and Retail. Reliant
on labor rather than capital to
sell goods. Functions cannot
be outsourced therefore firms
must use new technology
or improve staff training to
increase revenue growth.
Bed & Breakfast & Hostel Accommodations
Plant & Flower Growing
Change in Share of the Economy
Capital Intensive
Labor Intensive
New Age Economy
Old Economy
Agriculture and Manufacturing.
Traded goods can be produced
using cheap labor abroad.
To expand firms must merge
or acquire others to exploit
economies of scale, or specialize
in niche, high-value products.
WWW.IBISWORLD.COM
Capital Intensity
continued
advances, the need for human

intervention in garden maintenance will
decrease. Conversely, increasing industry
Technology & Systems Many nursery and garden stores have

of
Technology
Change is L ow
Revenue Volatility
Level
The level
of
Volatility is L ow
greenhouses and outdoor gardens, which

use a moderate level of technology.
Tensiometers, for instance, control the
irrigation used in growing nursery stock and
plants. The soil moisture is monitored in the
plant root zone, allowing producers to
deliver the precise moisture level required
by the specific plant species. The
tensiometer can turn the irrigation system
on when water is required and a trickle
irrigation system delivers the water.
Other technological progress relates
specifically to greenhouse production
systems. For instance, temperature sensors
are able to sense greenhouse air
temperature and provide feedback to
heating and cooling systems. Plants can

therefore be kept in optimal temperature
conditions. Ventilation and air circulation
systems also allow crops to be maintained in
a uniform environment. Insect screening
can also serve to reduce the entry of insects
into a greenhouse.
Technological advances within retail
operations include computer scanning
cash registers and inventory
management systems. The introduction
and use of scanning cash registers has
assisted with the processing of sale
items. At the same time, inventory
management systems have enabled
operators to maintain stock levels while
keeping track of product sales.
Revenue volatility for the Nursery and

Garden Stores industry is low. Revenue
volatility depends on the level of
downstream demand from consumers,
which is in turn determined by
disposable income levels. Over the past
five years, the strengthening economy

has allowed many consumers to spend on
home renovations, including lawn and
garden enhancements. Because of this,
revenue has steadily increased over the
period, exhibiting very low volatility.
A higher level of revenue

volatility implies greater
industry risk. Volatility can
negatively affect long-term
strategic decisions, such as
the time frame for capital
investment.
When a firm makes poor
investment decisions it
may face underutilized
capacity if demand
suddenly falls, or capacity
constraints if it rises
quickly.
Volatility vs Growth
1000
Revenue volatility* (%)
Level
The level
competition will require operators to hire

more knowledgeable staff, which will
increase total wage costs.
Hazardous
Rollercoaster
100
10

1
0.1
Stagnant
30
10
Blue Chip
10
30
50
70
Five year annualized revenue growth (%)

* Axis is in logarithmic scale
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Revenue Volatility
continued
While revenue growth was more rapid

early in the five-year period as consumers
released pent-up demand, growth has
been relatively stable. On the supply side,
weather conditions can affect the price
and volume of nursery stock and plants.
However, many of these items are grown

under cover, which limits the adverse
effects of unpredictable weather. This
supply side buffer helps mitigate more
extreme revenue fluctuations in
consumer demand.
Regulation & Policy
Nursery and garden stores face regulation

related not only to fair trading practices but
also to the environment. Congress and
individual states enact trade regulations,
with the aim of maintaining a free and
competitive economy. Federally, the
Sherman Antitrust Act, the Wilson Tariff
Act, the Clayton Antitrust Act and the
Robinson-Patman Act, along with various
other regulations, limit unfair competition
among businesses. Additionally, states have
enacted their own antitrust laws to ensure
that consumers are provided with the best
price, quality and competition among
businesses. Nursery and garden centers
must also satisfy occupational workplace
safety requirements for staff. Further,
companies must comply with the Fair Labor

Standards Act, which establishes a
minimum wage, overtime and other
working conditions. Store owners must also
comply with the provisions of the Americans
with Disabilities Act of 1990, as amended,
which requires stores to be accessible to
customers with disabilities and protects
those with disabilities from discrimination.
In the United States, nursery and plant
products containing pesticides must comply
with the Federal Insecticide, Fungicide, and
Rodenticide Act (FIFRA) and be registered
with the Environment Protection Agency
(EPA) before they can be sold or distributed.
Pesticides are hazardous to consumers
health and can also poison plants.
Tariffs apply to some of the products sold

by this industry. For instance, the tariff
levied on trees, shrubs and bushes ranges
between zero and 25.0%. Garden tools
such as spades and hedge or grass shears
are levied a tariff between 0.6% and 5.1%.
Fertilizer is free from tariff duty. Tariff
rates vary depending on the country of
origin and on the product.
While tariffs are applicable to goods
sold by this industry, they do little at the
retail level. Retail operators purchase
goods from the wholesalers that import
these items after the tariff has been
applied. A change in the tariff rate can
alter the price of the product if the
retailer does not choose to change its

supplier. A decline in tariffs can also
result in falling purchasing costs for
retailers, which they can pass on to
consumers as lower prices, thus boosting
their competitiveness.
There are two specific types of taxes
applicable to this industry, sales tax and
use tax. Sales tax is applicable to the
retail sales of tangible property while use
tax is applicable to the purchase of an
item from an out-of-state retailer for use
in another state. In addition to the sales
and use tax, local jurisdictions in each
state are empowered to apply their own
local sales and use tax.
Level & Trend

he level of
T
Regulation is
Lightand the
trend is S
teady
Industry Assistance
Level & Trend
he level of
T
Industry Assistance
is N
oneand the
trend is S
teady
WWW.IBISWORLD.COM
29
Key Statistics
Industry Data
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Sector Rank
Economy Rank
Industry
Revenue Value Added
($m)
($m)
39,599.7
6,006.0
36,063.2
6,081.8
35,049.0
5,711.3
31,384.2
4,798.7
32,167.7
4,699.3
33,892.6
5,304.2
35,757.0
4,686.7
37,531.8
5,267.3
38,866.3
5,378.7
40,168.1
5,701.9
41,434.4
5,843.7
42,690.6
6,001.9
43,539.7
6,092.4
45,033.5
6,251.7
46,376.6
6,403.5
30/63
32/63
344/1373 516/1373
Establishments
23,003
23,438
23,434
22,835
22,853
22,719
22,134
22,122
22,339
22,390
22,526
22,700
22,801
23,028
23,221
44/63
352/1373
Enterprises Employment
19,838
155,450
20,046
152,714
20,212
145,257
19,627
134,973
19,564
132,045
19,464
133,398
19,261
127,697
19,206
129,961
19,332
132,359
19,349
134,928
19,434
137,154
19,535
139,789
19,609
141,196
19,741
144,378
19,874
146,881
41/63
38/63
339/1373
339/1373
Exports
---------------N/A
N/A
Industry
EstablishRevenue Value Added
ments
Enterprises Employment
(%)
(%)
(%)
(%)
(%)
-8.9
1.3
1.9
1.0
-1.8
-2.8
-6.1
0.0
0.8
-4.9
-10.5
-16.0
-2.6
-2.9
-7.1
2.5
-2.1
0.1
-0.3
-2.2
5.4
12.9
-0.6
-0.5
1.0
5.5
-11.6
-2.6
-1.0
-4.3
5.0
12.4
-0.1
-0.3
1.8
3.6
2.1
1.0
0.7
1.8
3.3
6.0
0.2
0.1
1.9
3.2
2.5
0.6
0.4
1.6
3.0
2.7
0.8
0.5
1.9
2.0
1.5
0.4
0.4
1.0
3.4
2.6
1.0
0.7
2.3
3.0
2.4
0.8
0.7
1.7
54/63
55/63
53/63
43/63
52/63
1211/1373 1261/1373 1208/1373 1097/1373 1229/1373
Exports
(%)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Imports
---------------N/A
N/A
Wages
($m)
4,501.2
4,495.0
4,099.0
3,794.4
3,830.8
3,880.8
3,506.7
3,653.4
3,746.3
3,842.1
3,929.1
4,025.3
4,081.7
4,197.3
4,293.1
29/63
444/1373
Annual Change
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Sector Rank
Economy Rank
Key Ratios
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Sector Rank
Economy Rank
IVA/Revenue
(%)
15.17
16.86
16.30
15.29
14.61
15.65
13.11
14.03
13.84
14.20
14.10
14.06
13.99
13.88
13.81
37/63
1172/1373
Imports/
Demand
(%)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Exports/
Revenue
(%)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Figures are in inflation-adjusted 2015 dollars. Rank refers to 2015 data.
Revenue per
Employee
($000)
254.74
236.15
241.29
232.52
243.61
254.07
280.01
288.79
293.64
297.70
302.10
305.39
308.36
311.91
315.74
24/63
718/1373
Imports
(%)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Wages/Revenue
(%)
11.37
12.46
11.70
12.09
11.91
11.45
9.81
9.73
9.64
9.57
9.48
9.43
9.37
9.32
9.26
31/63
965/1373
Domestic
Demand
(%)
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
N/A
Number of
adults over 50
(%)
2.7
2.7
2.6
2.7
2.4
2.2
2.2
2.2
1.8
1.5
1.5
1.5
1.5
1.4
N/A
N/A
Average Wage
($)
28,955.93
29,434.11
28,218.95
28,112.29
29,011.32
29,091.89
27,461.10
28,111.51
28,304.08
28,475.19
28,647.36
28,795.54
28,908.04
29,071.60
29,228.42
19/63
1089/1373
Share of the
Economy
(%)
0.04
0.04
0.04
0.03
0.03
0.04
0.03
0.03
0.03
0.03
0.03
0.03
0.03
0.03
0.03
32/63
516/1373
Wages
(%)
-0.1
-8.8
-7.4
1.0
1.3
-9.6
4.2
2.5
2.6
2.3
2.4
1.4
2.8
2.3
54/63
1254/1373
Employees
per Est.
6.76
6.52
6.20
5.91
5.78
5.87
5.77
5.87
5.93
6.03
6.09
6.16
6.19
6.27
6.33
11/63
826/1373
Number of
Domestic adults over 50
Demand
(Mils)
N/A
89.7
N/A
92.1
N/A
94.6
N/A
97.0
N/A
99.6
N/A
102.0
N/A
104.3
N/A
106.6
N/A
109.0
N/A
110.9
N/A
112.5
N/A
114.2
N/A
115.9
N/A
117.5
N/A
119.2
N/A
N/A
N/A
N/A
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Jargon & Glossary
Industry Jargon
BEDDING PLANTAn annual plant that is grouped with

others to produce an aesthetically pleasing display.
MASS MERCHANDISERA retail store that is
differentiated by its sheer size and large range of
products, including electronics, household goods and
other consumer products.
IBISWorld Glossary
BARRIERS TO ENTRYHigh barriers to entry mean that

new companies struggle to enter an industry, while low
barriers mean it is easy for new companies to enter an
industry.
CAPITAL INTENSITY Compares the amount of money
spent on capital (plant, machinery and equipment) with
that spent on labor. IBISWorld uses the ratio of
depreciation to wages as a proxy for capital intensity. High
capital intensity is more than $0.333 of capital to $1 of
labor; medium is $0.125 to $0.333 of capital to $1 of labor;
low is less than $0.125 of capital for every $1 of labor.
CONSTANT PRICESThe dollar figures in the Key Statistics
table, including forecasts, are adjusted for inflation using
the current year (i.e. year published) as the base year. This
removes the impact of changes in the purchasing power of
the dollar, leaving only the real growth or decline in
industry metrics. The inflation adjustments in IBISWorlds
reports are made using the US Bureau of Economic
Analysis implicit GDP price deflator.
DOMESTIC DEMANDSpending on industry goods and
services within the United States, regardless of their
country of origin. It is derived by adding imports to industry
revenue, and then subtracting exports.
EMPLOYMENTThe number of permanent, part-time,
temporary and seasonal employees, working proprietors,
partners, managers and executives within the industry.
ENTERPRISE A division that is separately managed and
keeps management accounts. Each enterprise consists of
one or more establishments that are under common
ownership or control.
ESTABLISHMENTThe smallest type of accounting unit
within an enterprise, an establishment is a single physical
location where business is conducted or where services or
industrial operations are performed. Multiple
establishments under common control make up an
enterprise.
EXPORTSTotal value of industry goods and services sold
by US companies to customers abroad.
IMPORTS Total value of industry goods and services
brought in from foreign countries to be sold in the United
States.
INDUSTRY CONCENTRATIONAn indicator of the
dominance of the top four players in an industry.
Concentration is considered high if the top players account
for more than 70% of industry revenue. Medium is 40% to
70% of industry revenue. Low is less than 40%.
TENSIOMETERA control irrigation system in nurseries.

Soil moisture is monitored in the plant root, allowing
producers to give the right moisture level needed by
specific plant species.
INDUSTRY REVENUEThe total sales of industry goods

and services (exclusive of excise and sales tax); subsidies on
production; all other operating income from outside the
firm (such as commission income, repair and service
income, and rent, leasing and hiring income); and capital
work done by rental or lease. Receipts from interest
royalties, dividends and the sale of fixed tangible assets are
excluded.
INDUSTRY VALUE ADDED (IVA)The market value of
goods and services produced by the industry minus the
cost of goods and services used in production. IVA is also
described as the industrys contribution to GDP, or profit
plus wages and depreciation.
INTERNATIONAL TRADEThe level of international trade
is determined by ratios of exports to revenue and imports
to domestic demand. For exports/revenue: low is less than
5%, medium is 5% to 20%, and high is more than 20%.
Imports/domestic demand: low is less than 5%, medium is
5% to 35%, and high is more than 35%.
LIFE CYCLEAll industries go through periods of growth,
maturity and decline. IBISWorld determines an industrys
life cycle by considering its growth rate (measured by IVA)
compared with GDP; the growth rate of the number of
establishments; the amount of change the industrys
products are undergoing; the rate of technological change;
and the level of customer acceptance of industry products
and services.
NONEMPLOYING ESTABLISHMENT Businesses with no
paid employment or payroll, also known as nonemployers.
These are mostly set up by self-employed individuals.
PROFITIBISWorld uses earnings before interest and tax
(EBIT) as an indicator of a companys profitability. It is
calculated as revenue minus expenses, excluding interest
and tax.
VOLATILITYThe level of volatility is determined by
averaging the absolute change in revenue in each of the
past five years. Volatility levels: very high is more than
20%; high volatility is 10% to 20%; moderate volatility
is 3% to 10%; and low volatility is less than 3%.
WAGESThe gross total wages and salaries of all
employees in the industry. The cost of benefits is also
included in this figure.
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Nursery & Garden Stores in the USDecember 2015 1

Nipped in the bud: Rising demand for garden

IBISWorld Industry Report 44422

Nursery & Garden

2 About this Industry

20 Market Share Concentration

20 Key Success Factors

30 Jargon & Glossary

20 Cost Structure Benchmarks

Key External Drivers

11 Industry Life Cycle

13 Products & Markets

27 Technology & Systems

13 Products & Services

28 Regulation & Policy

www.ibisworld.com | 1-800-330-3772 | info @ibisworld.com

Nursery & Garden Stores in the USDecember 2015 2

About this Industry

Stores in this industry primarily retail a

The primary activities of this industry are

stores that retail farm supplies such as

Operating farm supply stores

11142 Plant & Flower Growing in the US

Nursery & Garden Stores in the USDecember 2015 3

About this Industry

For additional information on this industry

writes over 700 US

Nursery & Garden Stores in the US December 2015

Annual Growth 10-15

Annual Growth 15-20

Per capita disposable income

Revenue vs. employment growth

There are no major

Products and services segmentation (2015)

Key External Drivers

Per capita disposable

Tools and other

External competition for

Grain and animal feed

Life Cycle Stage

Nursery & Garden Stores in the USDecember 2015 5

Executive Summary | Key External Drivers | Current Performance

Over the past five years, the Nursery and

industry, the remaining stores have largely

format. Superstores such as Target and

Per capita disposable income

External competition for the

external competition has put strain

Key External Drivers

Nursery & Garden Stores in the USDecember 2015 6

increase in 2015, posing a potential

Per capita disposable income

Key External Drivers

Nursery & Garden Stores in the USDecember 2015 7

The Nursery and Garden stores industry has

The strengthening household market has

market, they usually engage in a variety of

Nursery & Garden Stores in the USDecember 2015 8

Although the industry has experienced

Nursery & Garden Stores in the USDecember 2015 9

Over the next five years, the Nursery and

Traditionally, consumers over age 55 have

operators. As big-box stores continue to