Plant Nursery Business Plan

Why write a 5 or 10 year plant nursery business plan for your retirement or backyard nursery? Good question! After you have learned how to start a plant nursery it becomes time to plan. Here are some key reasons to plan in 5 to 10 year blocks of time.

• Plants take a long time to grow. Our average planting to sale time is 2 to 3 years. In many cases this can be even longer!
• You may want to project your future revenue.
• If you are a current or soon to be retiree, you may want to focus on a ramp up periods and then an end date for you nursery.

Our video on starting a Plant Nursery Business Plan

 

Our plant nursery business plan goals have been as follows.

In our case we wanted to scale up around age 60 and are likely to start winding down around age 70 to 75. At some point we may slow or even stop planting new plants. This was our plan by age and our plan to generate a reliable income:

• 60 to 65 – generate some strong supplementary income before retiring. Use the money to cancel off some debt, increase savings, build plant inventory, and establish the nursery infrastructure.
• 65 to 67 – Generate a specific income to delay taking Social Security until age 67,
• 67 to 72 -Continue to enjoy the nursery business while adding to our income and savings or at least not touching our savings.
• 72 to …. Take it as it comes and likely downsize a little by not replanting as heavily.

Plant nursery business plan, working backwards

When planning a nursery you might find it easier to plan backwards. Decide what you want to make per year in profit and count back the number of years your plants will need to grow. This will give you the number of plants you need to plant. Example if you will net $20.00 per plant after cost and want to make $20,000 per year, you need to plant at least 1,000 plants.

In the chart below you can see that to earn around $10,000 per year in profit, you would need to be growing about 1,000 plants per year. This plan includes 2 years of investment, growing and assumes a $14.00 plant sale price. You do get your investment back after turning a profit in year 3. You also get some bonus profits the last 2 years of operation as you stop buying plants, pots,and dirt.

A more aggressive 10 year plant nursery business plan

If you want to build a larger income you may need to grow larger plants and more varieties. In this example the target annual net income is $28,000. The assumptions are that you now grow 2,000 plants per year. In order to have an average plant sale price of $22.00, you may also buy larger pots, use more plant soil mix, and possibly buy larger plants upfront. Instead of selling plants in year 2, we show sales starting in year 3. Likewise the last 3 years of the plan shows an increase in profit as you can stop replanting. Your investment also increased to $12,000 but your total 10 year plan grows to total profits of $280,000. A very nice return on investment and a nice amount of money to add to your income over 10 years.

A More Detailed Plan is a Must!

Keeping more detailed records is must if you really want to attain your income goals. You also want to track how certain vendor’s plant do, a loss ratio, costs before loss. Projecting out total sales and profit is also important. You can’t sell plants you haven’t grown or propagated.

The most important projection is how soon the plants will be ready to sell. We plant a lot of Spruces and Arborvitaes and grow them out for 2, 3 and sometimes 4 years. Keeping track of when these plants can be sold plus if planted in the Fall or Spring can become a real headache without records. Mixing in other plants that will be sold in more or less time makes it even harder. Here is a simplified sample of 3 years of planting, selling and profits.

What does this planting and selling plan tell you.

There is a lot of information collected in a plan like this including:

• Plant type and Size
• The vendor or grower you purchased from
• The number of plants you ordered and then a calculated 5% rate of loss (This is proven to be a good number)
• All your costs for the plants, soil mix, pots, and fertilizer = total costs for the 95% surviving plants.
• Pot size used and years you plan to grow the plant.
• Expected sale price, when you will sell, anticipated total sales and profit after expenses, by year.

Note: No plants shown planted for 2024 and you can see this drops 2026 sales down. Assuming you keep planting or increase planting your profits would stay the same or increase.

Having a 10 year nursery plan is also good if you are younger

You may have some specific goals such as:

• To start a profitable side hustle.
• Move toward a goal of running a full time nursery business.
• Meet some specific income or savings goals.
• Establish your property as an agricultural use property to capture any available tax reductions.

Whatever your specific goals are we would encourage you to start planning as early as possible, and keep revising your plan.

A plant nursery business plan for pre-retirees and retirees is important

We have found the following to be good advice:

• Start a business before you retire. We started our plant nursery 5 years before we planned to retire.
• You can cover start up costs out of your working cash flow.
• You can write off some start up expenses against your current salary income.
• You should have nice profits even before you stop working. You can stash more away in savings just before retiring which is good and have confidence in future income.
• You might use any extra nursery income while still working to reduce any debts you may have before retiring. This could include your mortgage, car loans, or credit card debt.

Here is a potentially great idea. With a reliable extra retirement income established you can potentially postpone your Social Security payments. This is good for many and will boost your income when you are older and possibly unable to work. For example leave your stressful day job at age 65 and use your nursery income instead of taking Social Security. Take your SS at full retirement age of 67 and then decide how long you want to work at the nursery business. You will have raised your SS income a meaningful amount and created an extra stream of income.

Likewise you can postpone some or all withdrawals from your retirement nest egg for a few years. This will preserve your nest egg and even give it several more years to grow. Remember your nest egg may need to last you until you are 100! Working in your nursery is great exercise too that may help you live longer!

Plant propagators really need a Plant Nursery Business plan.

If you plan to do a lot of plant propagation you need to start early and really test out how long it takes you to grow plants. Many propagated plants take at least 6 to even 48 months longer to get to a sell ready condition. This is especially true in the woodier plants. Rooting them and growing them out to a good size can take 2-5 years. Growing out a bare root liner takes less time in your nursery as it is already 1 to 5 years old. Trees like spruces that are often grown from seeds can be bought at 1,2,3,4 and even 5 years old. Older/larger trees do cost more upfront but you can save years of growing time. This includes weeding, watering and pruning. All this needs to be in your planning, especially if you want to establish a reliable income.

Starting your nursery 2-3 years before you retire or plan to have a reliable income is ideal. Much depends on if you are propagating, what you are growing, and what size starter plants you bring in. On the other hand if you are growing out perennial starts, maybe you can be selling just one year after starting. Either way you need a plan to eliminated surprises.

The bottom line. If you can start just part time on weekends only 2 years before, you will be way ahead. Start 3 years before if you plan to start with very small cuttings.

How we started with an initial nursery plan and income goal

We didn’t have a plan until about a year after starting. The first year was about experimenting and learning although we did eventually sell every plant we started that year.  By the next spring, just a year from starting we potted up over 2,000 plants for a total of 3,300 plants potted in the first 12 months of really being in operation. In addition we rooted about 200 new plants the first year but probably failed on about 200 more. From there we are buying and planting about 1,500 to 2,000 plants each spring and fall. In addition the goal is to root at least 500 new plants per year. Ok, this is ambitious but it doesn’t take all that much time potting up plants once you have some practice. We now hope to maintain a planting schedule of 4-5,000 plants per year.

Once we gained an understanding of buying and planting bare root trees and plants , buying pots and how to make your own potting soil mix we realized we could scale up our operation pretty quickly. Adding in propagating even more plants and we started running out of time. We still work full time but find planting 4,000 plants per year an attainable goal. Just wait until we go full time! In our plan we also expect to scale back as we enter our 70’s, knowing us that probably won’t be a major slow down. Maybe we just drop the 5 gallon plant sizes!

Adjust your Plant Nursery Business Plan as you go.

After a year of learning how to start a plant nursery you may find you want to adjust some of your initial plans. Factors that can cause you to change your plans:

• You find you are better at growing or prefer growing some plants over others.
• Customers may ask for plans you are not growing.
• You find you can grow more or less plants than you initially planned. Generally you will find you can handle a lot more than you thought.
• As you start making sales and get your initial investment back, you may decide to reinvest portions or all of your profits into a larger than planned nursery.

Now it is up to you to time to take the fist step. If you feel hesitant, read our article in what is holding you back from starting a plant nursery business.

For more backyard nursery tips and ideas see:

Backyard Plant Nursery Tips for Success
How to Start a Plant Nursery
Make a Retirement Investment in Nursery Plants
How to Make Money With Plants in your Retirement