February 2025 - 39

POHMER ON ...
Standing out with Sustainability
So why promote your sustainability efforts? I've written
before about your value proposition being an integral part
of your brand statement. Most customers like to align
themselves with companies that share common values, and
a high percentage of your current and potential customers
are supportive of sustainability, even if they aren't actively
involved in it themselves.
By communicating your sustainability involvement,
you'll increase the propensity of your existing and potential
customers to support you over competitors who aren't
involved or promoting their sustainability efforts.
The areas of opportunity for sustainability involvement for
retailers and grower/retailers are many; here are just a few:
* Organic plants and fertilizers
* Native plants
* Reducing the use of chemical fertilizers and pesticides
* Water conservation
* Reduce/reuse/recycle to minimize waste
* Composting
* Reduce the use of fossil fuels and petroleum-based
plastics
Financial Sustainability
There's another side to sustainability that hits closer to
home, but isn't talked about as much as the eco-friendly
variety we've just discussed - the financial sustainability
of your garden center. In 2024, retail garden center sales,
transaction counts and unit sales were all down; our
only salvation was that retail prices were up, so sales
weren't as depressed as they could have been. This kind
of performance isn't sustainable over time if we want to
reach our potential and to stay in business.
I believe it's a good idea to go take a hard and frequent
look at some of these activities, factors and formulas:
Formulas to help manage your financial performance
and decisions include:
* Cash flow analysis
* Sales per employee
* Liquidity
* Return on assets
* Interest coverage ratio
* EBITA
* Debt-to-equity ratio
* Return on capital invested
* CAPEX investment return
* Inventory turnover by category and item
* Break-even analysis
* Net profit by category (gross margin less all expenses,
markdowns and waste)
* Customer conversion rate
* ROI
Look for trends (good and bad) and comparative
Groovy Plants Ranch in Marengo, Ohio, invites customers to return pots to be
reused as part of its sustainability program. Photo by Teresa McPherson.
performance to last year as you review the data to identify
areas to refocus your time, energy
and resources; the sooner you can
identify any issues, the sooner you
can resolve the problem.
Another step to financial
sustainability is your relationship
with your lenders. Financial
institutions are becoming more
reluctant to provide funds to
small, seasonal businesses with
perishable inventory that is at
the whim of weather and with
a product seen by the consumer
as a luxury. Keep an open line of
communication with your lenders
throughout the year, not just when
you are looking for a loan.
Re-evaluate your relationship
with your supply partners and your
customers. Look for opportunities
to foster two-way loyalty that
benefits both your business and
theirs. It's just as important to
market your business to your supply
partners as it is to your customers!
Sustainability ... saving the
planet is critically important, but
sustaining your business should
be equally important to you, your
employees and your customers.
LGRMAG.COM | 39
http://www.LGRMAG.COM
February 2025

Table of Contents for the Digital Edition of February 2025
