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Profit For All Seasons
| Bill McCurry
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>> Published Date: 7/26/2012
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 As the garden center market shrinks, new leaders are emerging. One such trailblazer lives near a small town in Colorado. Her staff gave this revolutionary a ruler with “Inventory Slasher” and “Bad Buyer” printed on it. The intent was to provide our heroine a way to rap the knuckles of buyers who exceeded their allowed Open to Buy budget. Gail Vanik of Four Seasons Greenhouse & Nursery (Dolores, Colorado) is one of an emerging group of retailers who admit, “Making a profit is hard work; can be fun—but it is mandatory if you’re going to survive.”
Many professionals aren’t doing the hard work of utilizing assets to reach positive cash flow. After decades in the industry, Gail and her husband, Vic Vanik, sought out consultant help. Now fans of Robert Hendrickson and Steve Bailey (The Garden Center Group), they began by listening and arguing. Happily they realized the recommendations had merit. They sorted out the best for their company and worked hard to put the suggestions into practice.
Gail notes that the concept of “less is more” was tough to understand at first. “I’m fortunate Ken Lain (Watters Garden Center, Prescott, Arizona) mentored me. He stressed, ‘Know your numbers! Whether plants or paperclips, you’re shipping things in and out. Know your numbers or you’re lost.’ Steve and Ken have made a huge difference in how we look at our company.”
“We were exhausted after late nights loading trucks for wholesale orders. When we saw our numbers, we finally understood every wholesale order was at least 10% below our real cost. And that’s without counting the night work Vic and I were doing. That meant our retail sales had to subsidize 10% of our wholesale volume. We got rid of wholesale. Less is more. Time we could devote to the profitable business soared and our overall profits skyrocketed. We hadn’t known the numbers. When we learned them we were on our way—we haven’t looked back!”
It’s not all rules and regulations at Four Seasons. After a successful sales period, Gail and Vic called a mandatory evening meeting for all hands. Staff was unhappy because of their seven-day schedule. It also meant a special trip in for several of the 15-person team. But they all came into the office and sat through a routine meeting wondering, “What’s so important we had to come tonight?” While Vic and Gail kept the employees busy inside, chefs from the town’s best restaurant were out on the front lawn barbequing their signature steaks for a surprise thank you party.
“It’s critical to recognize the people who help you. We need our support people.” Gail is quick to give plaudits to her accountant, her IT company and her entire list of service providers. After an excruciatingly emotional Mother’s Day POS crash, they discovered the old IT firm hadn’t connected the backup system correctly and hadn’t installed the back-up hard drive, meaning treble back-up was nonexistent. The new IT firm labored long hours and restored the data. That firm had a full gourmet meal delivered to their office. “It’s okay to surprise and delight suppliers, employees and your customers,” Gail says.
“When we’re not getting what we need, we make a change. We upgraded both the quality of our accountancy firm and the value. We’re getting more topical advice, better communication and we’re paying less than half of what we paid before. It’s never comfortable making those changes, but sometimes it’s necessary.”
Nothing has been more impactful on the bottom line than Gail’s “Inventory Czar” reputation, which is backed up by the ruler when needed. Giving buyers a firm Open To Buy budget requires them to:
- Focus on and fully understand product sales history;
- Give serious consideration/analysis to new products and trends;
- Allocate scarce resources to highest and best uses;
- Reduce carryover, markdowns and wasted production costs that eat profits.
In 2011, Gail and Vic got super serious about enforcing the buyers’ budgets. Their end-of-year tree and nursery stock inventory was down an amazing 60% and perennials were down 90%. Profit was the best in the company’s history and likely in the top 10th percentile in the country. Four Seasons makes money while having fun because they know their priorities. GP
Bill would love to hear from you with questions, comments or ideas for future columns. Please contact him at wmccurry@mccurryassoc.com or (609) 688-1169.
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