The financing of a wholesale grower is more complicated because of the variation in size, greater capital investment, greater susceptibility to the vagaries of mother nature, and length of the growing cycle. The volume of sales that will be necessary to generate a satisfactory income to the owner-manager will vary. The owner-manager of a small business can earn a satisfactory wage by performing tasks that an employee might otherwise perform. Inventory is critical when considering the financial aspects of the wholesale growing division of the nursery business. The cost of a growing inventory must financed over a period of one to six years, or more.
Profits emerge only after the plants have been sold.
Since many growers are steadily expanding their acreage, the profits of one year are absorbed in the increased costs of an expanded growing inventory. The same applies to those garden centers that choose to grow a sizeable portion of the plants for their sales. Many garden centers choose to purchase all their plants from wholesale growers, enabling them to concentrate their time and energies on retail merchandising.