The annual revenue of a plant nursery business will depend on various factors such as the location of the business, the size of the business, and of course, the business strategy of the business. The truth is that there is no one mold-fits-all when it comes to how much a plant nursery business is expected to make.
Generally, smaller plant nursery businesses may generate a few thousand dollars in annual revenue, while larger businesses can earn several thousand dollars in sales annually.
Average Annual Revenue Range for Different Sizes of Plant Nursery
Small Local Plant Nursery Business
Available data shows that small, locally-owned plant nursery businesses usually generate annual revenues ranging from $20,000 to $200,000 or more. Note that this amount will depend on the size of the business and its customer base.
Basically, a plant nursery business is considered small when the business operates with less than five employees and perhaps from a small piece of land or from a backyard garden. Usually, small plant nursery businesses often cater to retail customers in their immediate area.
Medium-Sized Plant Nursery Business
Available data shows that medium-sized plant nursery businesses with a broader customer reach, more plant variety, and possibly landscaping services can have annual revenues ranging from $200,000 to $700,000 or even more.
A plant nursery business is considered medium-sized when the business operates with over a dozen employees, and from a portion of land that is as big as a standard football pitch.
Usually, medium-sized plant nursery businesses often cater to retail and wholesale customers at both local and national levels.
Large Commercial Nurseries
If you are planning to start a large commercial plant nursery business, then you should be looking at over a million dollars annually.
A plant nursery business is considered a large commercial business when the business operates with over 25 employees, and from several acres of land.
Usually, large commercial plant nursery businesses cultivate several plants, and they supply the plants to wholesalers, garden centers, and landscapers at local, national, and international markets. The carter to the export market too.
Profit Margin of a Plant Nursery Business
Profit margins for plant nursery businesses generally fall within the range of 10 percent to 30 percent, but they can be higher or lower depending on the factors discussed below:
Your Operating Cost
When we talk about operating costs, we are talking of costs such as labor, utilities, rent or land expenses, equipment, supplies, etc. Trust me, these costs if kept low, can significantly increase your profit margins.
Your Plant Selection
The truth is that some plants have higher production costs, while others are more profitable due to their demand and pricing.
As a matter specialty or rare plants such as Corpse Flower (Amorphophallus titanum), Venus Flytrap (Dionaea muscipula), Pitcher Plant (Nepenthes),
Ghost Orchid (Dendrophylax lindenii), and Titan Arum (Amorphophallus titanum) usually have higher profit margins compared to common varieties such as Rose (Rosa), Hosta (Hosta), Geranium (Pelargonium), Impatiens (Impatiens walleriana), and Petunia (Petunia).
Your Pricing Strategy
The truth is that if you are able to fix the price for your plants appropriately, it will help you balance competitiveness and of course increase your profitability.
One of the ways that owners of plant nursery businesses increase their profit margin is by offering a range of price points that will help them capture a wider customer base.
Your Marketing and Branding Strategy
Effective marketing and branding strategies will help you drive sales and an increase in sales volume usually translates to an increase in your profit margins.
If you can successfully manage your inventory and marketing strategies, you will be able to take advantage of peak planting seasons.
During peak planting seasons, you can easily get higher yields and no doubt, higher yields will lead to higher sales and improved margins during those times.
Your Customer Base
A nursery plant business that serves a mix of both retail and wholesale customers is likely going to make more profits when compared to a plant nursery business that serves either a wholesale market or retail market. Wholesale sales usually yield higher sales volumes but lower margins, while retail sales usually attract higher margins.