As a nursery owner or manager, increasing profit margin for the business is always a main concern. The plant nursery is a labour intensive industry with over 70% of the nursery operation cost is a labour cost. In order to improve your nursery profit margin, you need to minimise the labour cost.
The Horticultural Research and Development Corporation (HRDC) conducted a research amongst 52 nurseries in Australia (NSW, QLD,VIC) in 2000.
|Number of nurseries participating in the research
|Small (1-5 staff)
|Medium (6-15 staff)
|Large (over 15 staff)
|Number of pots investigate in each of pot size
|Number of pots
The research found that 65-85% of excessive potting labour costs come from the inefficient organisation of potting procedures, the use of inappropriate potting system and equipment and poor materials handling methods.
The research result also indicated that many nurseries in Australia can reduce potting labour costs and increase profit margins by improving the efficiency of their potting production systems.
In order to find out how to improve nursery potting efficiency, we have to look into the potting systems and find out how to evaluate the potting efficiency.
What is the potting system in a Nursery?
The nursery potting production system can be divided into:
- Hand potting
- Machine potting
Hand potting is the process where potting staff manually fill pots by hands using equipment such as a standard bench, modified bench, mobile bench systems, tables, purpose built potting stations and utilising trailer deck tops. Hand potting has a high physical demand on nursery workers. It can cause potting staff to fatigue over time and affect the production rate.
Compared with hand potting, machine potting is a more efficient method for the potting practice in a nursery. If a potting machine is well designed, it should have ergonomic working height which ensures that workers’ comfort levels are high.
Staff normally perform better due to the speed setting on the potting machine and constant media flow. Some potting machines also have a dibbling functionality. Although it is common that nurseries buy potting media which has already been mixed with fertiliser, sometimes the process of dibbling media is necessary and should be adopted to promote plant nutritional.
The dibbling process includes getting the fertiliser into a hopper, forming a hole in the potting media for the fertiliser, inserting the fertiliser as a measured amount and covering the fertiliser.
Evaluating your potting efficiency
Objectively evaluating the efficiency of a production system is difficult, researchers from HRDC came up with an evaluation system to identify specific areas nurseries can potentially increase their profit margin by reducing potting labour costs.Potting production efficiency in a nursery is affected by issues such as:
1. Worker Related Issues
- The levels of worker health and safety
- The level of workers’ comfort
- The skill levels of workers (The technique of potting etc)
- The allocation of tasks to potting staff
2. Organisation and Potting procedures
- The location of the potting area relative to the growing area
- The elimination of non productive time in potting production
- The quality of information coming from management to potting staff
- The handling of potting inputs and potting outputs
3. Improvements to potting system
- The proper potting system to the type and number of plants being potted
- The operating speed of the potting machine
Below is a document with some questions for the nursery manager to give an indication of whether:
- your potting labour costs are higher than necessary
- there is a possibility to further reduce labour costs
- your nursery should investigate the potting efficiency problems in more details
How to improve nursery potting efficiency?
The recommendations below are given by the The Horticultural Research and Development Corporation (HRDC) after conducting the research amongst 35 participating nurseries in Australia:
1. Worker Issues
- Always try to have worker health and safety policies in place and have warning labels on the potting machine to avoid risk of accidents.
- Purchase potting benching with ergonomic working height and try to use a machine to eliminate repetitive and tedious manual work to ensure workers’ comfort
- Train staff and help them work efficiently with less non-productive hours
- Allocate tasks to workers according to their motivation and abilities in performing different potting tasks
- Rotate workers tasks to prevent repetitive and boring tasks that could lead to injuries
2. Organisation and Potting procedures
- Hand potting is generally more suitable for nurseries when: (1) During the potting season, the daily quantity of potted plants is about 1,000 or less, and/or (2) Average batch sizes of plants requiring different treatments, procedures, pot sizes, pot colours, or of plant types that are in clearly different categories of potting difficulty, is below approx. 300.
- Use a potting machine that is specially designed to cope with different size pots when hand potting volumes are uneconomical for the nursery.
- Use conveyor, trailers and trolley/barrows to improve transport efficiency for the handling of potted plants which is one of the most time consuming tasks in production nursery.
- Communicate clearly with potters before potting starts to avoid wasted materials, time and efforts
- Analyse tasks collaborated by different workers before potting, during potting and after potting to reduce non-productive time
3. Improvements to potting system
- Figure out the amount of total potting labour cost on cents per pot
- Find out problems in potting systems, bottlenecks, procedures and worker issues
- Work out the cost and benefit of potential improvements ie. purchase a potting machine to speed up the potting process, or have a different potting machine more suited for the lower or higher volumes, or have a hand potting station available for the lower volumes, bigger pots or for potting up. Reduce a bottle neck by getting more nursery trailers or adding extra decks to your existing trailers.
- Indentify which type of potting equipment (semi-automatic or fully-automatic) is best to suit your nursery according to the quantities of plant material being potted and the required different treatments, procedures, pot sizes, pot colours and plant types required during the potting season – refer to the hand potting above
- Introduce the most beneficial changes to get a quick return on investment (ROI)
- Re-evaluate the new potting system
Due to the high labour cost in many nursery businesses, it is important to constantly evaluate the potting efficiency and try to improve it through the different aspects of worker related issues, organisation and potting procedure as well as the improvement to potting equipment.
The general recommendation given above by HRDC is to raise awareness on how to increase the average daily number of plants to be potted, which have similar treatment, potting procedures, pot sizes and colour. If nursery managers don’t have enough time to investigate or don’t have the capability to identify and solve the potting efficiency problems, contracting a production system consultant is a good alternative solution.