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
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Small (1-5 staff) | Medium (6-15 staff) | Large (over 15 staff) | Total | |
QLD | 5 | 4 | 8 | 17 |
NSW | 8 | 8 | 7 | 23 |
VIC | 4 | 4 | 4 | 12 |
Total | 17 | 16 | 19 | 52 |
Number of pots investigate in each of pot size | |||||||
Pot Size | 100mm | 125mm | 130mm | 140mml | 150mm | 1750mm | 200mm |
Number of pots | 15680 | 11750 | 1960 | 56820 | 7830 | 9800 | 41150 |
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.
The nursery potting production system can be divided into:
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.
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:
The recommendations below are given by the The Horticultural Research and Development Corporation (HRDC) after conducting the research amongst 35 participating nurseries in Australia:
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.