Ken Altman on Buying (and Avoiding the Same Fate as) Color Spot

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Friday, February 08, 2019

Chris Beytes Subscribe
Acres Online
COMING UP THIS WEEK:
Ken Altman on the Spot deal
- Integrating the new facilities
- How they won't screw it up
- The locations and their size
Know a young grower or retailer?
Retail Trends webinar Feb. 13
What HRI is funding this year
In memoriam: John "Jake" Jost
Finally ...

Ken Altman on the Color Spot purchase

It’s no secret that when bankrupt Color Spot went up for bid at auction last July, Ken and Matt Altman wanted it.

“We were the other bidder in the auction,” he told me at the time. “We made a very large bid to purchase all the assets, but in the end, the bank decided to credit bid for the company. We are working to see what we can purchase from the bank.”

That last statement, which came to fruition December 21, includes eight former Color Spot locations in California and Texas covering 10.3 million sq. ft. of greenhouse and shadehouse and more than 1,700 acres of field production, making Altman Plants the largest (by area) grower in the country by a comfortable margin.

I covered that news in the January 10 issue of Acres Online, but without being able to speak with Ken directly. In that item, I wrote that I had two main questions for Ken: “Why?” and “How will you not let this sudden massive expansion screw up what you’ve already built?” Finally catching up with Ken as he drove to the airport earlier this week, I was able to ask both those questions and a few more.

After the customary greetings, I thanked Ken for being a good sport about the rather direct, unvarnished way in which I had phrased my second question.

Ken, who knows that’s my style, dismissed my concern with a generous laugh.

“I’ve been asked that question from the time we came out of our backyard,” he said.

But before we got further into that, I asked him question No. 1: Why make the decision to add so many locations and so much retail territory to an already large nursery?

“We like the nursery business, and we like our customers, so this gives us more of all of that,” he replied. But he admitted that it's a major expansion, even for the formerly second-biggest nursery in America.

“It’s a big jump. But I have to tell you, we’ve been growing very rapidly for a number of years. I think even from the first years, we have always grown in double-digit numbers every year. It’s just that when we first started, we were making $10 a week—double digits wasn’t so big. Now it’s getting bigger.”

I asked Ken if perhaps the acquisition looks bigger and scarier to those of us on the outside than it does to him.

“I think even to us it’s a big deal,” he answered. “But I have to say, we have a really great management group. There are a lot of really experienced people who run fairly good-sized enterprises themselves. And we have younger people who are coming along and are gaining skills. So I think we have a really good roadmap for running this.”

How they’re bringing the new locations aboard

To run the new operation, Ken says they’ve retained the location managers that were with Color Spot. They expanded the territories of their West Coast and Southwest divisional leaders. And he and his son, co-president Matt, are busy filling positions where needed.

“One thing we’ve found is that there are a lot of great people at Color Spot. They seem to be happy and really good about joining us. Morale has been pretty good right now with some of the direction we’ve been providing.”

I asked about the initial reaction of the former Color Spot staff to the new ownership.

“You never know because every company has its own culture, but when we first took over, Matt and I and some of the other managers made a quick circuit through every location and talked to all the employees in group get-togethers—one great thing about that is that Matt is 100% fluent in Spanish, so he was able to communicate bilingually so everybody could understand and participate.

“We had a few main points that we were trying to get across: one is that we are going to be all about quality in our plants and every decision that comes up we are going to make in favor of quality.

“Another thing is that we are going to be totally customer-focused and 100% on making customers satisfied. We’ve always had a position in our company of wanting to say ‘yes’ to our customers. When we get a request from a customer, our first impulse is to say yes, then figure it out. We want to make sure that the bigger company also has that same point of view.

“The final thing we told everybody is that we are going to be one company. The company happens to be Altman Plants, but the idea is that we are going to reach out our hands in welcome to everybody who joins our organization.

“That seemed to resonate with people, the idea that there’s now a family that cares a lot about plants, cares about the nursery business and has a really long-term view of things. They’ve been through equity owners and bank owners; I think all those people did their best job, but we have a different point of view, a longer point of view.”

Also boosting morale? Raises. Ken noted that wages had been stagnant at Color Spot, so they’re boosting the pay of all the production people by a considerable percentage. He didn’t want me to say how much, but it’s generous.

“We think we can pay more by being inventive and efficient, and growing good plants,” he said.

How they won't screw up what they've already built

So back to question No. 2: We watched Hines Horticulture get big, then fail. We watched Color Spot Nursery get big, then fail. How does Altman Plants avoid that same fate?

“First of all, I beg you, don’t put us on the cover of GrowerTalks,” Ken joked. (I had just pointed out to him that both Color Spot and Hines had been featured as cover stories in the past. He’s been there already—the December 2016 issue, so it’s too late.)

Then he got serious.

“We’re going to concentrate on exactly what I told the employees. If we have really good quality plants and we don’t forget where our bread is buttered—which is our customers—and we do everything to make them happy, and if we keep the morale of our company up as one company, that should be good.”

One other note about those other two vs. Altman: They were bank- or private-equity owned. Altman is still 100% family owned.

The former Spot facilities they’ll be running

After visiting and evaluating all the Color Spot assets they acquired, Ken and Matt have put together the following list of facilities they’ll be running, along with the size of the operation:

California:
Fallbrook – 192 acres, 1.2 million sq. ft. of greenhouse
Salinas – Added 240 acres and 3.3 million sq. ft. of greenhouse
Lodi – 39 acres and 700,000 sq. ft. of greenhouse

Texas:
Troup – 334 acres, 3 million sq. ft. of greenhouse
San Antonio – 580 acres, 2.1 million sq. ft. of greenhouse            

Ken says they have three more Texas facilities—Waco, Fort Davis and Walnut Springs—but they're “mothballed” and will stay closed at this time.

Know a Young Grower or Retailer?

The deadline for submitting nominations for Ball Publishing’s annual Young Grower and Young Retailer Awards is fast approaching. March 1 will be the last day for you to send us the name of your favorite 35-and-under grower and/or garden retailer. (Yes, you can nominate yourself.) The only catch is nominees have to be younger than 35 by July 15.

Once we gather all the submissions, our editors study, sort, debate and finally determine which three nominees will be our finalists for each of the two categories. (As a helpful hint, the more details you include about work and career accomplishments, the better.)

Our finalists don’t have it easy after that point. We task them with writing a 600-word essay for the June issues of GrowerTalks and Green Profit, they’re interviewed by our three judges (during the height of the spring rush, no less!) and then they travel to Cultivate’19 in July (on our dime), where they’ll be wined and dined with the likes of Anna Ball and other horticultural luminaries TBD. The announcement of the winners will take place during Cultivate’s lively Unplugged event Monday evening. It’s a fun experience that all finalists treasure, whether or not they take home the top award.

Fill out the quick-and-easy nomination forms here:

GrowerTalks/Nexus Young Grower Award.

Green Profit/RBI Young Retailer Award.

Retail trends webinar Feb. 13

Attention retailers (and growers who sell to retailers … which probably means YOU): I’ve got a webinar coming up that you won’t want to miss. It’s called “Five Trending Marketing Tips for IGCs.”

Slated for Wednesday, February 13 at 1:00 p.m. Eastern/Noon Central, this free Green Profit webinar will feature a pair of talented, well-traveled Proven Winners account managers, Jessica DeGraaf and Meghan Owens. They spend much of their time traveling across North America visiting and talking with the managers of independent garden centers, seeing what successful retailers are doing to draw in and motivate their customers to buy.

Meghan (left) and Jessica will share some trendspotting, some new products for 2019 and some new tools you can use to move the needle on sales for the coming year.

What’s going to be extra fun is that this webinar won’t be hosted by me (I’ll be behind the curtain, pushing the buttons). No, instead, we’ve got our retail mavens Ellen Wells and Jen Polanz tag-teaming the host duties. And, technology willing, you’ll see all four of them live on video feed while enjoying the PowerPoint presentation.

Sign up now at www.growertalks.com/webinars.

See you there!

What HRI is funding this year

The Horticultural Research Institute (HRI) funds loads of timely research projects that directly or indirectly help all horticulture businesses. Their slate of research projects for 2019, which they’ve funded to the tune of $437,200, includes retail plant purchasing habits, RFID and drones for nursery inventory, and using two different mediums in one pot to reduce nutrient and water use. Here’s a list of all the projects, and the profs and schools behind them:

“Off the sales floor & into the cart: Analyzing the path to plant purchases”
- Dr. Bridget Behe, Michigan State University

“Fertility, population dynamics, & pollinator attractiveness of standard & sterile cultivars: Buddleia as the case study may inform the way forward for our national industry”
- Dr. R. Contreras, Oregon State University

“Seed your future”
- Dr. J. Dole, North Carolina State University and S. Yoder, Seed Your Future
(Continued support of the Seed Your Future program, which aims to increase the number of students and graduates in horticulture programs)

“RFID & beyond: Using RFID, drones, and BLE to improve crop inventory management”
- Dr. R. Fernandez, Michigan State University

“Fundamental aspects of auxin foliar spray applications to woody plant cuttings”
- Dr. R. Geneve, University of Kentucky

“National green industry survey”
- Dr. Charlie Hall, Texas A&M University
(Conducted every five years since 1988)

“Interactions between spotted lanternfly and woody ornamentals that influence tree health and insect fitness”
- Dr. K. Hoover, Pennsylvania State University

“Using hyperspectral technology to assess seed quality of horticultural crops”
- Dr. M. Mesgaran, University of California – Davis

“Boxwood blight management in the landscape”
- Dr. J. LaMondia, Connecticut Agricultural Experiment Station

“Measurement of plant nitrogen status in floriculture and nursery production using smartphones”
- Dr. K. Nemali, Purdue University

“Landscape plant performance: Water use assessments of new cultivar selections”
-Dr. L. Oki, University of California – Davis

“Defying gravity: Stratified growing media to reduce inputs, crop stress, and minimize time to market”
- Dr. J. Owen, Virginia Tech

“Submist for propagation of nursery crops by stem cuttings"
- Dr. B. Peterson, University of Maine

“Preventing clogging of irrigation emitters caused by algae in greenhouse and nursery”
- Dr. R. Raudales, University of Connecticut

“Increasing inventory management efficiency with automation for ornamental nurseries & Christmas tree farms using unmanned aerial systems”
- Dr. M. Wallhead, University of Maine

For more details on each project, click HERE.

The Horticultural Research Institute’s mission is to direct, fund, promote and communicate horticulture research. Supporting research that challenges current methods and bridges the divide between businesses and the consumer is exactly how HRI helps build prosperous businesses, advance the green industry and fulfill its core vision.

In memoriam: John “Jake” Jost

I’m saddened to report the news of the passing of John “Jake” Jost, patriarch of Jost Greenhouses in Des Peres, Missouri. But he “had a good innings” as the Brits would say, living to 88.

Born and raised in South St. Louis, Jake’s career included earning a Ph.D. in Botanical Taxonomy from Washington University. After serving in the Korean War, Jake enjoyed a wide and varied career, working in various nurseries and running a floral shop and landscape business with his wife, Doine Lee. He also spent time in the chemical end of the horticulture business, working for Mallinckrodt Chemical Company and as a consultant for Grace-Sierra.

In 1984, he and his sons Victor and Eric started Jost Greenhouses, specializing in perennials, groundcovers and unique woodies. They now have two locations serving the wholesale landscape industry. Jake had a passion for gardening and propagation and reportedly made excellent pear preserves and the world’s best potato pancakes.

Finally …

I thought NASA had figured this stuff out decades ago, and that teams of subsequent researchers had added evidence to support that plants are great things to have around the home, office, city, hospital, correctional institution … you name it.

Well, now we’ve got some more evidence to add to the pile, thanks to that august institution Wageningen University in the Netherlands. They did a comparison study, with various companies and care institutions either adding plants to their spaces or having spaces with no plants. The researchers tested air quality, participant reactions and even hormone levels of participants to test stress levels.

The findings? Humidity was 5% higher on average; employees perceived the temperature as more comfortable and the workspace as more attractive; employees’ moods were better and they were more satisfied with their own work performance; and employees called in sick 20% less often.

That last one alone should be worth the investment in a few fiddle leaf figs, eh?

My local DMV has a plant. But one plant can only do so much, you know?

Read all the details HERE. But more importantly, spread them around like butter! The general public still doesn’t know how amazing plants are. If they did? Stand back!

See you next time,


Chris sig

Chris Beytes
Editor
GrowerTalks and Green Profit


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