Trade Flows and Marketing Practices of Louisiana and Gulf States Nurseries

The markets facing nursery producers have changed dramatically in the past decade. These changes in nursery markets have outdated previous research. New research into nursery marketing will assist nursery producers in making marketing decisions. Nursery producers can market their plants to five different marketing channels: Mass-merchandisers, garden centers, other retailers, landscapers and re-wholesalers. This study described the 1998 Louisiana nursery industry, analyzed nursery market changes over the past decade in Louisiana and the Southeast and analyzed characteristics of Louisiana and Southeastern nurseries to estimate marketing channel choice. Data was collected via mail using the third Trade Flows and Marketing Practices survey. Non-respondents to the mail survey were contacted by telephone to obtain survey information. The resulting data set was compiled and tabulated to form a description of the 1998 Louisiana nursery industry. Data from the 1998 TFMP survey was compared with data from the 1988 and 1993 surveys. An analysis of variance for each of the marketing channels was performed to determine if and how marketing channel use had changed over the decade. In order to estimate marketing channel use, a model was designed with the proportion of sales through each channel as a function of a set of market oriented variables such as sales, acreage, age, contract sales, transaction methods, in-state sales and sales to four or more marketing channels . A system of five equations was designed to estimate marketing channel use, one equation for each marketing channel. Analysis of the Louisiana nursery market over the past decade showed that Louisiana nurseries have increased sales to retailers and re-wholesalers at the expense of landscapers. Analysis of nursery marketing channel choice revealed that nurseries have little market power to make marketing decisions. It appears that the retailers and the market dictate marketing decisions in the nursery industry.