Green Industry Risk
Management
Comprehensive Education
National Extension Risk Management Education Conference. April 12-13, 2011. St. Louis, MO
Dr. Marco A. Palma
Assistant Professor and Extension Economist
Texas AgriLife Extension Service
Texas A&M University System
mapalma@tamu.edu
Outline
Who is the target audience?
Green Industry Background
Educational materials
Project Outcomes
Follow up
Who is the target audience?
Green Industry producers
Nursery and greenhouse growers
Landscaping design and maintenance
Retail nurseries and garden centers
Green Industry
Background
Year Established
Percent of Firms
0%
1800-99
10%
0.7%
1920--39
0.9%
1960-69
1970--79
1980--89
1990--99
2000--08
30%
40%
50%
0.2%
1900--19
1940--59
20%
2.6%
5.5%
6.3%
15.7%
24.4%
43.7%
Firm Size Distribution by Annual Sales
Share of Respondents
Million
Dollars
0%
Share of Total Sales Reported
10% 20% 30% 40% 50% 60%
< 0.25
50%
0.25--0.49
9%
0.50--0.99
8%
1--1.9
0%
10%
3.9%
6%
5.7%
4.6%
3--3.9
2%
4.5%
9.7%
2%
1%
15--19.9
0%
20--29.9
1%
30--39.9
0%
40--49.9
0%
50+
1%
Not reported
2.2%
1%
10--14.9
40%
2.2%
3%
5--9.9
30%
1.8%
2--2.9
4--4.9
20%
5.5%
3.6%
13.3%
7.0%
4.1%
31.9%
15%
0.0%
Summary of U.S. Nursery Industry Population, Expanded
Sales and Employment, By Region, 2008
Region
Number Survey
Respondents
Business
Population
Validated
Population
Expanded
Expanded Sales Employment
(million$)
(permanent &
temporary jobs)
Appalachian
332
3,509
2,025
1,947.9
25,273
Great Plains
45
290
150
247.8
2,966
Midwest
481
5,148
2,888
3,516.5
49,142
Mountain
115
1,069
516
436.0
8,181
Northeast
644
8,060
4,610
4,550.9
45,194
Pacific
434
6,582
3,224
8,353.0
59,564
Southcentral
216
2,648
1,216
2,822.6
12,943
Southeast
774
10,708
5,174
5,264.0
59,677
3,041
38,014
19,803
27,138.7
262,941
Total All
Regions
Validated business population excludes inactive and disqualified firms in telephone survey.
Expanded estimates compiled by state and firm size strata.
State
Sales by State in Million $
CA
FL
TX
PA
GA
NY
NJ
LA
OH
IL
MI
VA
NC
WA
TN
OR
HI
AL
NH
NM
CT
MD
MN
IN
IA
Sales
6,681.8
3,520.9
1,350.4
1,235.0
1,013.5
927.7
916.7
872.0
859.7
830.6
715.7
661.1
588.0
565.0
543.9
480.6
475.6
432.2
423.8
405.2
377.9
309.6
308.7
239.5
217.2
State
MO
NE
CO
WI
SC
AK
KY
MS
VT
OK
AR
MA
MT
ME
AZ
ID
RI
KS
UT
SD
WY
DE
WV
NV
ND
Sales
182.8
181.3
171.0
162.3
151.1
150.1
147.1
146.3
141.3
98.2
96.9
90.4
82.5
74.0
67.6
66.8
44.5
37.4
30.9
27.1
11.1
10.0
7.8
6.1
1.9
Plant Types Produced/Sold
Share of Total Sales Reported
Share of Respondents
0%
10%
20%
30%
40%
0%
5%
10%
15%
11.8%
Deciduous shade and…
37.5%
28.2%
Deciduous shrubs
Broad-leaved evergreen shrubs…
5.7%
6.4%
25.7%
Narrow-leaved evergreen shrubs
3.4%
19.5%
Evergreen trees
7.0%
34.5%
Azaleas
2.2%
16.5%
Vines and ground covers
19.7%
Roses
18.2%
Herbaceous perennials
3.0%
3.6%
5.3%
26.2%
Bedding plants – flowering…
9.8%
22.9%
Bedding plants – vegetables,…
20.4%
Flowering potted plants
4.1%
7.0%
18.3%
Christmas trees (live or cut)
12.9%
2.7%
Fruit trees
12.2%
2.6%
Foliage
12.2%
Sod
Propagated material (liners,…
Other plants
6.1%
5.3%
6.5%
9.8%
15.0%
3.5%
10.5%
Sales Transaction Methods Used
Share of Total Sales Reported
Share of Respondents
0%
20%
Trade show orders
80% 0%
10%
Internet
17.5%
0.8%
30%
40%
50%
43.3%
73.5%
11.4%
20%
5.8%
55.8%
In-person orders
Other method(s)
60%
16.9%
Telephone orders
Mail orders
40%
43.7%
2.6%
4.4%
0.3%
Market Channels Used
Share of Total Sales Reported
Share of Respondents
0%
10% 20% 30% 40% 50% 0%
Mass merchandisers
7.5%
Home centers
8.2%
Single location garden
centers
30%
21.9%
7.5%
43.5%
Re-wholesalers
30.8%
37.9%
2.2%
40%
7.5%
11.5%
Landscape firms
20%
9.3%
34.1%
Multiple location
garden centers
Other type(s)
10%
21.3%
1.8%
Other Sales Practices Followed
Share of Respondents
Share of Total Sales Reported
0% 20% 40% 60% 80% 100% 0%
Repeat customer sales
85.6%
Negotiated sales
Export sales
53.5%
28.0%
33.3%
100%
80.5%
68.9%
Brokerage sales
Contract sales
50%
36.6%
10.4%
15.5%
3.7%
Factors Impacting the Business
Percent of Respondents
0%
10%
Weather uncertainty
Land
Very
Important
Important
20%
14.3%
19.9%
Water supply
20.5%
Debt capital
12.0%
Equity capital
10.9%
24.5%
25.5%
18.9%
18.7%
18.8%
24.2%
27.1%
20.4%
26.0%
16.0%
20.9%
Other government regulations
16.5%
20.7%
Ability to hire competent hourly…
12.6%
19.6%
60%
21.3%
Environmental regulations
Ability to hire competent management
50%
25.3%
43.8%
Labor
Competition/price undercutting
40%
33.6%
Market demand
Own managerial expertise
30%
16.7%
21.2%
70%
Texas Size and Trends
Economic Impacts
Production & Manufacturing
Nursery & Greenhouse
Lawn & Garden Equipment Manufacturing
Prefabricated Metal Buildlings¹
Horticultural Services
Landscaping Services
Landscape Architecture Services
Wholesale & Retail Trade Horticulture Products²
Flower Nursery Stock & Florist Supplies Wholesalers
Lawn & Garden Equipment & Supplies Stores
Florists
Buildling Material & Supplies Dealers¹
Food & Beverage Stores¹
General Merchandise Stores¹
Farm & Garden Equipment Wholesalers¹
Total (All Sectors)
Output
($Mn)
2,684
2,061
552
70
6,808
6,425
383
5,748
189
2,465
1,140
721
179
856
198
15,239
¹ Green industry represents a portion of overall business activity.
² To facilitate impact analysis, gross sales figures for retail sectors were adjusted for cost of goods sold (margins).
Employment
(jobs)
24,878
22,488
2,077
313
83,681
80,901
2,780
62,304
1,101
22,124
19,069
6,562
2,007
10,284
1,157
170,863
Value
Added
($Mn)
1,245
1,030
185
30
3,584
3,361
223
3,600
117
1,505
763
449
110
533
123
8,429
Educational Materials
Immigration and Labor handbook
Green Industry Risk Management Guide
Webinars
Presentations
Available in Risk Management Library
Educational Materials
Planned for 150 live participants
Actual number 365
Follow up – planned 350
Actual 550
Distributed over 800 copies of materials
Educational Materials
Partnership with industry groups are key
Overwhelming response to webinar
participation
 Economic crisis
 Cost effectiveness of delivery
Promotion of webinars to all TNLA
members –
Educational Materials
Immigration and Labor HB







A brief History and Overview of US
Immigration
Government Agencies Principally responsible
for Immigration
Immigration Reform and Control Act 1986
Social Security No Match Letters
The Green Card process
Non-Immigrant Visas
H2A Program
Immigration and Labor HB








Migrant and Seasonal Ag Worker protection
Act
Migrant Labor Housing Facility Act
Farm labor Camps
Standards for Sanitation at temporary places
of employment
Employment of Minors- Federal & Texas
Work Opportunity Tax Credit
Fair Labor Standards Act
Texas Minimum Wage Law
Immigration and Labor HB









Texas Payday Law
Federal Income Tax Withholding
Social Security
Unemployment Compensation
Texas Workers Compensation Law
Advanced Earned Income Credit
Worker Protection Standards Act
Agricultural Hazard Communication Act of TX
Occupational Safety and Health Act
Immigration and Labor HB


Motor Carrier Regulations –Federal & Texas
Equal employment Legislation
Responsible Agencies Sections
Name
Address
Phone Numbers
Website
Email addresses
Risk Management Guide
Size and Structure of the Green Industry
Overview of Risk Management Principles
Production Risks and Responses
Risk Management through Crop Insurance
Marketing Risks and Responses
Financial Risks and Responses
Risk Management Guide
Human Resource Risks and Responses
Legal and Environmental Risks and
Responses
Funding: National Crop Insurance
Services, USDA Risk Management Agency
Webinar 1
“High Performance Management to
Survive Turbulent Times”
 Action Points to Survive the Downturn – Dr.
Charlie Hall, Texas A&M University
 Differentiating By Being Sustainable – Dr.
Don Wilkerson, Texas A&M University
 Marketing Green – Dr. Jenifer Dennis,
Purdue University
Webinar 2
“Water Quality, Conservation, and
Management”
 What's in Your Water? Water Quality and
Treatment for Pathogens and Algae - Dr.
Paul Fisher, University of Florida
 Knowing Exactly When to Apply Irrigation
Water - Dr. Peter Ling, Ohio State University
 Water Management that Makes Cents! - Dr.
Don Wilkerson, Texas A&M University
Project Outcomes – webinar 1
Increase in Knowledge, differentiation 19%
Increase knowledge sustainability 7%
75% will adopt the practices
$133,000 in economic profits/savings
($1,000 was largest category)
Additional 467 views of the recording
Project Outcomes – webinar 2
Increase in Knowledge – 41%
82% will adopt the practices
$839,000 in economic profits/savings
Additional 83 views of the recording
Project Outcomes
$972,000 in economic profits/savings with
365 participants
Additional 550 views
$1,465,000 in additional economic impacts
For total of $2.4 million in economic
benefit. Award Size: $40,238
$59.6 dollars in return for every $1
invested
Questions
Dr. Marco Palma
Assistant Professor and Extension Economist
Texas AgriLife Extension Service
Texas A&M University System
mapalma@tamu.edu
http://hbin.tamu.edu