Strategies producers in the northeastern United States are using to reduce costs and increase profits in tough economic times

Abstract

The environmental horticulture industry (sometimes referred to as the "green industry") is usually divided into nursery and floriculture crops. The green industry in the northeastern United States is an important component of agricultural production, with over $2 billion in farm cash receipts, equating to 22.4% of all farm cash receipts in the northeastern United States. It is the number one agricultural commodity in five northeastern U.S. states. Competition in the green industry has become fierce. Many factors have put downward pressure on price. These include the recent volatility of fossil fuels and general energy prices, domestic competition, off-shore production, a weakened and stressed economy, and the growth of the mass market. Nationally, the number of producers continues to decline as a direct result of the newly defined economic risks. The industry's profit margins are typically low, leaving little room for growers to absorb significant increases in costs or decreases in revenues. Unlike farmers who produce field crops, nursery and greenhouse firms bear the entire price, market, and production risks because these crops have had no government support programs. This article will discuss what strategies producers in the northeastern United States are using to reduce costs and increase profits in tough economic times. It will analyze how producers have they honed their marketing and management skills to continue to survive and respond to current trends.