Economic and cost analysis of the floriculture industry differentiated by market segment.

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Title: Economic and cost analysis of the floriculture industry differentiated by market segment.
Author: Weddington, Megan
Advisors: John M. Dole, Committee Chair
Abstract: Data were collected from bedding and potted plant growers serving the wholesale and retail markets to determine business characteristics, average annual gross sales, average fixed and variable costs, costs per square foot per week ($/ft²/wk) or costs per square foot per year ($/ft²/yr) and utilization of space. Business size, including greenhouse area, outdoor pads, fields and supplemental buildings, ranged from 85,337 ft² to 222,336 ft². Greenhouses were the primary production area for bedding and potted plant growers, while cut flower growers primarily used field production. Bedding and potted plant growers averaged sales of $896,519 compared to sales of $45,423 for cut flower growers. Wholesale markets had higher sales than retail markets for bedding and potted plant businesses and cut flower businesses. Labor was the greatest expense for all market segments. Correlation analysis indicated a positive association between advertising costs and sales in the wholesale markets. Positive associations in the retail markets were found between employee compensation and sales and conference/travel expense and sales. Financial data collected from bedding and potted plant growers serving the wholesale and retail markets was used to determine space utilization and fixed costs per square foot per week ($/ft²/wk). Calculation of this cost included adjustments for space and time utilization. Wholesale bedding and potted plant growers were determined to have fixed costs of $0.236/ft²/wk and retail bedding and potted plant growers had a cost of $0.334/ft²/wk for greenhouse production area. Financial data collected from wholesale and retail cut flower growers were used to determine space utilization and costs per square foot per year ($/ft²/yr). The wholesale cut flower businesses were determined to have a fixed cost of $1.220/ft²/yr, while the retail cut flower businesses yielded a cost of $0.787/ft²/yr for field production. Businesses can compare their own costs to these industry averages. Costs per square foot per week and costs per square foot per year are valuable tools for business management and efficiency analysis. Monthly space utilization differentiated by production area was determined for each market segment. Bedding and potted plant growers primarily used greenhouses for production with some production on outdoor pads. Peak greenhouse usage for wholesale bedding and potted plant growers occurred in April (95.5%), and retail bedding and potted plant growers' greenhouses were most utilized in April and May (87.5%). Cut flower growers primarily used field production though some also utilized greenhouse space. Field production peaked in June (85%) for wholesale cut flower growers and in July (88%) for retail cut flower growers.
Date: 2003-11-21
Degree: MS
Discipline: Horticultural Science
URI: http://www.lib.ncsu.edu/resolver/1840.16/2019


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