Welcome Back!

Get ready to dig into an industry that’s blooming with potential - the garden centre sector in Canada! With the arrival of spring, it is the time when everyone suddenly has a green thumb and the shelves at garden centres are empty.

Now, we know what you’re thinking. “Isn’t gardening just for retirees and hipster plant parents?” Think again! With the pandemic turning us all into home improvement enthusiasts, the demand for plants, garden furniture, and outdoor decor has skyrocketed faster than an Elon Musk tweet can move the stock market.

So, let’s pot this discussion and see why the garden centre industry is ripe for investment. 🌿🌷

INDUSTRY BREAKDOWN

The Canadian Garden Centre Industry: A Growing Success? 🪴

Spring has sprung, and that means it's time to talk about all things green and blooming. Garden centres across Canada are buzzing with activity as homeowners and gardening enthusiasts prepare their outdoor spaces for the season. Whether you're considering buying a garden centre or just curious about the industry, there's a lot to dig into.

Industry Trends

Like a lot of other at-home hobbies, the COVID-19 pandemic has spurred a significant boost in home gardening and landscaping projects, leading to a surge in demand for garden supplies and services​​.

Although consumer interest in growing houseplants as a hobby has taken off, the gardening bug isn’t limited to potted succulents and vining beauties. Home gardeners have embraced landscaping projects and outdoor gardening as well. Garden Digest’s gardening data reports that Canadians and Americans spend around $6 billion and over 70 hours a year on lawn care. 🫣

While the crazy numbers above make you want to shake your head at how much society seems to care about their lawns… all the tools, plants, machinery, etc. have to come from somewhere! And that is why this industry is growing! 🌱

The Finances

I bet you are tired of hearing how COVID-19 affected things, and trust us, we are too. But it is too relevant not to mention in this industry! 😬 If you look at the way sales have grown, the average revenue of home gardening industry products had year-over-year growth of 4.62% in 2018. Two years later, in 2020, that annual growth rate nearly doubled to 8.79%. And that is (unfortunately) due to the extended amount of time spent at home surrounding the COVID-19 pandemic. 

The market size is expected to continue to grow steadily over the next five years, driven by increased consumer spending on home improvement and landscaping services. As millennials and Gen-Zers are becoming homeowners, it is no surprise that garden gadgets and Pinterest-worthy lawns are propelling the market and driving sales to garden centres.

Buy or Bust?

So, should you dig into the Canadian garden centre industry? Absolutely - buy! With a surge in demand for garden supplies, tools, and outdoor decor, combined with steady financial growth and increasing consumer spending, the industry shows no signs of wilting. As the next generations embrace homeownership, the trend towards aesthetically pleasing and functional outdoor spaces is only set to rise. Investing in this green-thumbed market could very well plant the seeds for a thriving business. 🍃

Check out these Garden Centres for sale:

1. Thriving Nursery/Greenhouse in Vernon, BC - $1,995,000

2. Profitable Plant Nursery in Haywood County, NC - $1,550,000

3. Established Nursery, Garden Center & Landscaping business + Real Estate in NY - $700,000

Interested in a particular industry? Reply to this email with the industry you are curious about and keep your eyes peeled in upcoming issues. 👀 

DEAL REVIEW

Established & Successful Garden Centre

This week’s deal is a Well-Established Garden Centre with a Strong Brand located in Manitoba

Deal Facts 🔥

Green Flags 🟢

• Strong Brand Recognition: The garden centre is well-established and recognized as a leader in the industry, which provides a competitive edge and customer trust.

• High Customer Repeat Purchase Rate: A high repeat purchase rate indicates customer satisfaction and loyalty, which is crucial for sustainable growth.

• Experienced and Engaged Staff: The business is run successfully by a highly trained and engaged staff, allowing it to operate efficiently without daily owner involvement.

• State-of-the-Art Facilities: With extensive retail space, greenhouses, and supporting infrastructure, the business is well-equipped for current operations and future growth.

• Comprehensive Growth Opportunities: The business has multiple avenues for expansion, including additional locations, wholesale, boutique produce, private label products, and online sales, ensuring potential for continued growth.

Red Flags 🔴

• High Asking Price: The listing price of $3,500,000 plus inventory might be a significant investment, requiring careful financial planning and substantial capital.

• Dependence on Leased Property: The success of the business is tied to the leased property, which can pose a risk if lease terms change unfavourably in the future.

• Seasonal Variability: The garden centre industry can be highly seasonal, with fluctuations in sales that may affect cash flow management.

• Labor-Intensive Operations: The business relies on a large number of employees (27 full-time and 35 part-time), which can be challenging to manage and can lead to high operational costs.

• Economic Sensitivity: As a retail business, it may be sensitive to economic downturns, which could impact consumer spending on garden and related products.

Watch Our Video Breakdown

For a more in-depth analysis, check out this video deep dive of the deal by our Founder, Morgan Tate:

The results are in, and based on our last edition, wineries a big hit! We have done an edition on Breweries, Coffee Shops, Wineries … so what’s next? Distilleries? 👀

Want to learn more about this deal? Reply to this email with a “send me more details” and we will connect you with the broker!

ADVERTISE

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TWEET HIGHLIGHT

This tweet was too fitting not to share!

This Smith’s Gardentown, a garden centre in Wichita Falls, Texas, celebrated 75 years of success last month. 🎉

You all know that we love a success story over here at Mainstreet Memo, so maybe we are biased… but imagine your business having such a large impact in the community that hundreds of people stop by to celebrate your 75th birthday. As much as the success of Smith’s has it’s perks for the family-run business, the impact it has made within the community is truly inspiring.

GOOD READS

Recommended Resources 📚

Below is a list of articles, books, and other resource we recommend for buyers or operators of small businesses!

1. Buying a business is a huge step in your career! So why fumble through the process alone? Hiring a business broker can help you with every step from finding the right business, to closing the deal.

2. Acquira recently launched a list of the best businesses to buy in 2024 - breaking down what to look for in a business and what to avoid during your searches.

3. While you could spend your time searching Facebook Marketplace for your next business for sale, why not check out these 9 popular listing sites? Orrrr (subtle plug here) you could check out our favourite listing site, DealBuilder - where new businesses are listed for sale almost every single day!

THANK YOU

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See you next time!