How are German garden centres faring?

Fresh-cut flower sales at German garden centre.

The global health crisis fuelled a boom in home gardening and grow-your-own, leading to good times for German garden centres. Then, Russia began its war against Ukraine. What followed was a pre-Christmas period characterised by ‘German Angst’. Is the demand in the German garden centre industry in recent years sustainable? Martina Meckelburg, President of the German garden centre association Vorstand & Geschaftstelle – Verband Deutscher Garten-Center e.V (VDG), has the details, writes Ruth Goudy for FCI.

Within the VDG association are 130 members with a combined ownership of 230 garden centres and 180 members from the garden supplies industry. According to Martina, “Nearly all the relevant, leading, and independent garden centres in Germany are VDG members. There are always more garden centres joining looking for advice and support to develop their business.” Martina works for the family-run Gartencenter Meckelburg (founded by Peter and Rolf Meckelburg in 1978), including nine garden centres with 200 employees.

Figures in brief

Regarding overall spending habits, Germany’s national spending on flowers and plants per capita was €107 in 2022, down from €108 in the pre-corona year 2019.

Narrowing these figures down to garden retail, Martina needs help to provide stats as there is not a clear definition of what must be considered a garden centre in Germany. The pertinent question is whether the small-owner-operated nurseries and plant shops must be included. However, one indicator is the stats of industry body Industrieverband Garten (IVG), stating that the average German household spends approximately €1,000 per year in garden centres and DIY stores, that is, including ALL categories such as home improvement, building materials, BBQs, swimming pools and living plants.

During the Covid-19 pandemic, garden centres did well. As time passed, turnover remained stable until February 2022, but the war in Ukraine changed everything. Also impacting the downturn in sales has been the drought in the summer of 2022 and container prices from China.

New consumers and trending products

The global health crisis brought new consumers to gardening. Many were younger families keen on ‘Grow-Your-Own’ gardening, even if they only had a balcony. Sales of big trugs and planters were high, and since then, they are repeatedly returning for their young vegetable plants and seeds.

Both older and younger people recognise that, rather than just working in the garden, they want to spend more quality time there to relax and recuperate. Robots to cut grass are becoming more popular. Socialising in that space is also essential, so BBQ and garden furniture sold well during Coronavirus. Now garden centres in Germany are concerned that once customers have a new BBQ or outdoor furniture, they are unlikely to buy again for a few years.

German garden centre customers are very aware of the environment, so bee-friendly plants, seeds and flowers are particularly popular. If a person is looking for a yellow flower, they will choose one that attracts bees rather than one that does not. Water usage is something gardeners are more conscious of, especially after the drought and hosepipe ban in 2022. Customers are interested in watering systems, including timers and drip systems. This is especially the case now that gardeners are using peat-free compost, which does not hold moisture like peat used to.

Sales and the cost of living

The Autumn of 2022 leading up to Christmas was a “German Angst” time. People were concerned about heating their houses, while within the industry, plant wholesalers and retailers were worried about being able to afford to heat their greenhouses and run their businesses. Recent studies by insurance company R+V and FORSA, the German Institute for Social Research and Statistical Analysis found that 67 per cent of Germans report feeling worried about the rising cost of living. Other issues affecting people include the statement that ‘living in Germany is no longer affordable (58 per cent) and an economic situation spiralling out of control (57 per cent). Germans also tend to worry about things they can’t control, including natural disasters/adverse weather conditions/ climate change (49 per cent) and, the global rise of authoritarianism (47 per cent), inflation rates eating away savings (55 per cent).

This was generally a media-led fear, but fortunately, sales at Christmas were better than expected. A particular product that suffered was outside lighting. Outside Christmas lights were usually frowned upon by neighbours, given the worry about Russia’s war against Ukraine and the risk of energy shortage.

While people are cautious with spending their money, they are simultaneously becoming very concerned about the environment. They are waking up to “greenwashing”, and in this area, they are more inclined to pay more for something that is sustainable. Consumers tend to research prices on the internet, and so hardware such as BBQs, tools and watering systems. This is an area that garden centres find hard to price match with online businesses and DIY chains.

The attraction of German garden centres

Customers prefer still to shop in-store rather than online. Meckelburg said, “You can do many things on the internet, but you cannot feel and smell a lemon tree. More importantly, you don’t always get what you see when you order online.”
Among other things, coffee shops are a big draw in German garden centres. Catering outlets are booming and are fully booked during the week and at weekends. Alongside plants and hardware, garden centres offer giftware and clothing all under one roof with free parking. Many big retailers in towns are closing, so this provides an alternative.

The DIY stores with garden centres attached are significant competitors, such as OBI, Hornbach and Bauhaus. The quality of their plants is good, but DIY stores may have the top five of any given plant, but a garden centre might have over twenty varieties of tomatoes to choose from.

Other competitors are the supermarkets ALDI and LIDL, with their seasonal plant promotions. This convenient ‘one-stop shopping’ leaves garden centre owners concerned that this is potentially one less visit per customer at a time when customers might be tempted to buy more.

The global health crisis brought new consumers to gardening.

The global health crisis brought new consumers to gardening.

Peat Free Compost

Peat-free is a hot topic in Germany. Most stores sell peat-reduced and peat-free compost. With that comes the need to inform customers about how to use peat free and to make sure that store staff are educated so that they can help with this.
Retailers are very conscious that this is important so that people do not give up gardening under the misapprehension that they have done something wrong. Martina believes there is potential to use QR codes with links to information about plants and, particularly, how to look after them.

Supplying the German market

Houseplants are one of the biggest imports, mainly from the Netherlands. This is a massive boom in the market and has continued with many younger consumers still buying regularly. Many garden centres buy from Landgard or local suppliers for general plants.

Following the pandemic and the cost of containers, hence shipping and imports from China, there is greater awareness of how important it is to bring back some skills and industry to Europe. With protest rallies about the environment and issues with CO and carbon footprint, it gives the consumer a good feeling to do their ‘bit’ for the environment and support European neighbours even if that means paying a little bit more.

Trade shows

Martina believes that trade shows are fundamentally important. She mentioned IPM Essen for new plants, Frankfurt’s Christmas World, and the country’s ‘premier garden and outdoor living trade show, spoga+gafa in Koln. Firstly, they inspire retailers, and secondly, you do business with people, so meeting them gives confidence in your supplier. “We like to look someone in the eyes when discussing price.”

Future challenges

Staffing is an issue. To attract and keep younger employees, vocational training is used. This is the connecting link between theory and practical application. Students study one day a week and apply the skills learned or acquired in the garden centre for the rest of the week.

Since the pandemic, recruiting people has been more challenging whether or not they have participated in vocational training. Horticulture is an industry that expects employees to work Saturdays and longer in the springtime, and one where working from home is impossible – these are important factors for employees now. Some garden centres offer incentives such as an electric bicycle or gym membership as an enticement.

Strengths in the industry

Martina is convinced that garden centres put people in a good mood. “We have everything to make people happy – I smell, I see, I touch the flowers. I bring home happiness.”

Gardens are places that promote health, good nutrition and creativity, and people are becoming aware of the positive effects on their mental health. Within their lives, they see lots of change. The digital age is not only destroying manual jobs, but AI is also threatening mental work, and they feel afraid. Gardening keeps them in touch with the natural world. As Martina says, “You cannot swipe right on a salad to make it grow faster.”

This article was first published in the April 2023 edition of FloraCulture International.

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