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«AgroInvest» — News — Green thumbs drive Germany's garden industry

Green thumbs drive Germany's garden industry

2011-06-29 12:20:12

The average consumer in Germany annually spends about 180 euros ($255) for plant products, according to the German Garden Industry Association (IVG). The hobby gardeners traditionally spend the most in the spring and summer months.

 

IVG represents the manufacturers of garden tools and accessories as well as suppliers of plants, garden soil and seeds. These products rake in almost 15 billion euros a year. Plants such as flowers, shrubs and trees account for two-thirds of sales, with the remaining share generated with gardening tools, appliances, ponds, decoration and outdoor furniture.

 

No crisis in gardening

 

Germany's Association of Gardening, Landscaping and Sports Field Construction (BGL) represents service providers such as garden architects and landscaping experts. Demand for their service is substantial, with revenue exceeding 5 billion euros in 2010, according to the association.

 

While the manufacturing sector wilted during the global financial and economic crisis, Germany's gardening industry stood in full bloom.

 

"The financial and economic crisis never hit us," said August Forster, a landscaping expert who manages a gardening firm with 65 employees in Bonn. "At the moment, we are experiencing a real boom, especially with private customers." 

 

Residential and commercial customers account for about 55 percent of annual sales, up from 40 percent 10 years ago. The increase, driven in particular by hobby gardeners, comes amid a downturn in contracts from the public sector.

 

With money tight in many cities, local authorities have been cutting back on maintenance costs for parks and public green spaces. "Public-sector contracts account for less than 20 percent of our business," said BGL head Hermann Kurth.

 

He said corporations were a growing source of income for BGL members.

 

"Factories like to make a good impression on their visitors even before they arrive in the lobby," Kurth said. "We plant flowers and shrubs all the way from the parking lot to the main entrance."

 

Impact of globalization

 

In addition to the downturn in business from the public sector, globalization is impacting the German garden sector. Nurseries are feeling the pain from competitors abroad, according to Kurth.

 

"There used to be numerous rose-growers in Germany, but many of them had to give up because they could no longer keep up with competitors from Morocco or Ecuador," he said. "Even if you add transportation costs, their roses are still less expensive than the domestic ones. Plus they are more beautiful with an interesting character. That's why plant production in Germany is slightly going down.”

 

Germany's fickle weather adds another element of uncertainty, according to IVG head Michael Cuypers.

 

"The elements beat the economy," he said. "That's a basic rule in our business and it has been proven right every year."

 

If there is good weather in the springtime with lots of sunshine, business picks up immediately, Cuypers added.

 

"When it's sunny outside, people who flock to the garden centers are willing to spend a good amount of money on their garden," he said. "In 2010, when we had a very long and cold winter, consumers were not willing to spend and that resulted in sluggish sales."

 

Garden demographics

 

Nevertheless, garden industry experts in Germany see growth on the horizon, driven in part by the country's aging society.

 

With increasing age, many elderly prefer or, for health reasons, are forced to stay at home, investing in their gardens and often hiring gardeners and landscapers to help them with the work. They also buy garden appliances and other gadgets to make gardening less cumbersome.

Deutsche Welle