Making the Choice between Rewholesalers and Other Nursery Market Channels

Abstract

<jats:p>Alternative market channels that include garden centers, landscapers, mass merchandisers, and rewholesalers have contributed to the growth of ornamental crops sales in the United States. Knowledge about growers' use of these channels is indispensable for the development of appropriate strategies to achieve goals. This study estimated the impacts of growers' business characteristics on market channel choice by firm size. The explanatory variables were evaluated separately but were grouped by regions of the United States, kind of plant, kind of contract sales, and promotion behavior. Growers' location had limited effect on channel choice when compared with growers in the south. Growers with a more diversified marketing strategy were associated with higher likelihood of using the mass merchandiser and garden center channels. Trade show attendance had a strong negative impact on choice to the mass merchandiser compared with the rewholesaler channel. Generally, there appeared to be differences in the groups of variables that were related to channel choice. By channel, plant groups were important in explaining the mass merchandiser and landscaper channels, and the contracts group affected the garden center choice. By size, the contracts variables impacted the mass merchandiser channel, plant groups variables impacted the garden center channel, and promotions variables impacted the landscaper channel.</jats:p>

Investigating Factors Affecting the U.S. National Nursery Trade: The Implications of a Gravity Model

“…We dropped selected observations from the data set if: 1) the destination was out of the United States because our focus was on the domestic nursery trade; 2) gross sales were equal to or less than $10,000, based on the USDA definition for commercial production (Velástegui Andrade and Hinson, 2009); 3) information about the year in which the firm was established was missing; 4) information about the nursery's home state was missing; or 5) the percentage breakdown among plant categories was missing. After imposing these conditions, the number of firms in the sample was trimmed to 5140.…”

“…For the observations that selected the sales ranges, the midpoints of each category were used to approximate the gross sales. Following Velástegui Andrade and Hinson (2009), we used $500,000 as the cutoff value to separate large and small nurseries, which resulted in 5,666 observations for large nurseries and 6,877 observations for small nurseries.…”

“…Behe et al (2008) and Hodges et al (2008) investigated the regional differences in the production and marketing practices in the U.S. nursery industry. Velástegui Andrade and Hinson (2009) subsequently studied choices of nursery market channels.…”

“…Nursery trade flows are influenced by firm size. Velástegui Andrade and Hinson (2009) explored the impact of business characteristics on market channel by firm size. Their study showed that firm size affected the channel choice and differences exist between large and small nurseries.…”

Understanding Ornamental Plant Market Shares to Rewholesaler, Retailer, and Landscaper Channels

“…The impacts of growers' business characteristics (firm age, categories of plants sold, trade show attendance, value of contracts with specific channels, and advertising expenditures) on market channel choice, by firm size, were compared using the multinomial logit model (Velástegui and Hinson, 2009). Producers with a more diversified marketing strategy sold larger shares to the mass merchandiser and garden center channels.…”