Two years ago, the third generation of Mays officially assumed leadership of Florida-based May Nursery. Armed with valuable lessons from the second generation, the newest managers are implementing a strategic plan that will preserve the nursery for years to come.
Richard May, president and general manager, now runs the business with his brother Ashley and their cousins John Bradford and Joel. For the past 18 months, the team has been working through a strategic plan that includes specific goals and metrics.
“It’s one thing to run a nursery and pot up plants, but you have to be intentional about it, not only on a day-to-day basis, but on a large scale, as well,” Richard says.
The plan helped them drill down on questions such as: Who are our customers; Which customers are making us money; Which customers do we service well; and Which plants are profitable and why?
“We now have a plan that helps us answer these questions, as well as plan and prioritize for capital improvements. It also helps manage inventory, which is the single most important aspect of operating a successful nursery,” Richard says.
Being intentional about the business is something he learned from the EAGL (Executive Academy for Growth & Leadership) program. EAGL is an eight-month executive education program, developed specifically for the nursery and greenhouse production industry. It’s operated in part by Charlie Hall and Texas A&M University. Richard completed the program last year.
The nursery has been focusing on SKU management and identifying the most profitable plants. They grow more than 400 different species, varieties and cultivars with an emphasis on evergreens, flowering shrubs, perennials and grasses. May Nursery’s primary customer base includes rewholesalers, landscape contractors and independent garden centers throughout the eastern United States.
“Our primary shipping areas are cities and states that are east of the Mississippi River and located in Hardiness Zones 5-7. This is where we offer the greatest value for our customers from a price point and the ability to service them well,” he adds.
The strategic plan and their sharper focus allow the nursery to withstand recessions and other economic difficulties. Richard and the team have implemented lessons they learned from the Great Recession, which has strengthened the business.
“I think all nurseries are smarter than we were in 2007 to 2013. We survived, we know how to work lean and we know how to concentrate on our profitability,” Richard says. “We can always survive if we are selling out of each crop. We cannot survive throwing away unsold inventory.”
Learning lean principles
Mechanization and efficient production practices have been a major focus at the nursery this year.
“With the issues the industry is having with labor, there is no other option than to mechanize as much as possible and to be as efficient as possible with our labor,” he adds.
There’s a ballot initiative in Florida this year that could have serious repercussions in the green industry and beyond. This is not legislation, but a constitutional amendment that would mandate a $15 minimum wage. The wage would be implemented gradually, not in one fell swoop. The ballot initiative only needs 60% of the vote to pass, Richard explains.
“This is a frightening proposition for the nursery industry. This will force us to cut as many employees as possible and raise prices at the same time,” he says. “It will be a very difficult situation to navigate, as our current business model is not sustainable at $15 an hour for labor. Not to mention the overall inflation effect this will have on everything throughout the state of Florida.”
Currently the nursery employs up to 130 people, depending on the season and they don’t use the H-2A program.
With the possibility of a sharp increase in labor costs, the nursery has been working with FlowVision, a lean flow and inventory management company.
Richard initially contacted the company to help with the design of a new and expanded loading dock.
“It got to a point where I said, ‘this is the last loading dock that I’m going to build.’ And I didn’t want to build a loading dock and look back and regret certain decisions,” Richard says. “So, I asked them for help in designing the loading dock and it snowballed from there. We decided to go full force into the lean flow process. They’re looking at our processes and finding ways to improve certain procedures and systems.”
The nursery expects to change the way it ships, tags, pots and propagates plants, but not all at once, Richard says.
“Some things will take months to implement and others may not be implemented for a year,” he adds.
Richard believes they have the most ground to gain from an efficiency standpoint with their shipping procedures.
“Our hope is to not only create more capacity for shipping, but primarily to give us the ability to process orders and load trucks more efficiently,” he says. “FlowVision says they can decrease labor in shipping by 25%. That doesn’t mean we’re cutting 25% of our people. Instead, that 25% will be put to use in other areas of the nursery.”
Currently, the nursery is spread out and two major highways intersect their property.
“We have to cross highways with tractors and trucks filled with plants. We want to figure out how to cross those roads fewer times, as well as put more plants on trucks in a shorter amount of time using fewer people,” he explains.
For propagation and potting, their No. 1 focus is to achieve more output per employee. FlowVision is working on plans to produce a 25% labor savings in propagation and a 10% savings in potting.
Richard expects the entire process to increase quality and eliminate shrinkage.
The next generation
Richard has been working alongside his father Fount Jr. and his uncles Brad and Fred for 18 years. And it was around that same time when Fount Jr., Brad and Fred executed a succession plan for their sons. It may be a bit unorthodox to draw up a succession plan almost two decades before the next generation takes over, but the estate tax exemption at the time was low and the nursery’s value had grown.
“Our CPA recommended it, so they created a trust for the nursery stock. We’re a corporation, and the stock remains in that trust,” Richard explains. “We will gain control of the trust when we turn 50. Their intention was good, but looking back, they may have dragged out the process a little too far.”
But succession planning is critical, and Richard acknowledges that it’s best to start the conversation early.
“Keep the conversation moving forward even if you hit roadblocks. Don’t stop talking. Hire a family business or small business consultant to walk you through the process,” he says.
The nursery turns 50 in 2021, but Richard, Ashley, John Bradford and Joel aren’t ready to start the next succession plan.
“Our generation is waiting a few years because our children are too young — or not even born yet,” he says.
The transition from the second generation to the third has been smooth.
“The older generation has been good about letting us do what we need to do. They still give us advice, but let us do our own thing,” Richard says.
Some of the most important lessons Richard has learned from his dad and his uncles help drive the business today. Those lessons include: Never be ashamed to ask for your money; labor and inventory are the only variables you can control, so watch them closely; don’t grow what you like, grow what you can sell; and if you can sell something in the fall, sell it because, “dollar bills don’t freeze in the winter.”
For more: www.maynursery.com