Mixed varieties that keep the profits growing

KENN LLOYD is one of the new breed of garden centre entrepreneurs. He spotted the market's rich potential in the early 1980s and has cultivated a successful business by combining slick retailing with horticultural knowhow.

The Cadbury Garden Centre at Congresbury, near Weston-super- Mare, is one of the largest in the country, with 80,000 sq ft of covered retailing space - the size of three large modern supermarkets.

There is parking for 1,000 cars and a 150-seat restaurant. In total, including concessions selling lawnmowers and conservatories, it generates a thumping pounds 6m turnover.

Unusually for the industry, Mr Lloyd is not a professional horticulturalist. His background is in marketing fast-moving consumer goods such as Kleenex, although he also worked for the vegetable seeds division of Shell.

In 1982 he struck out on his own, and acquired a small salad nursery which he says he has 'developed as cash allowed', investing pounds 2.5m in the centre to date.

Garden retailing on this scale is not just about providing shrubs for the herbaceous border. Mr Lloyd talks about a visit to his centre as a half-day out for the family - 'a leisure experience'.

Plants, indoor and outdoor, remain the core business, accounting for 42 per cent of sales. Christmas decorations add up to a hefty 25 per cent of turnover, with the pet centre generating a further 14 per cent. Garden furniture, tools, chemicals and fertilisers and other products make up the balance.

Offering a broader product mix widens the centre's appeal to customers and also, says Mr Lloyd, helps to offset the seasonal nature of garden retailing.

'In the early days we were seeing growth of around 30 per cent annually. The recession has slowed that growth and made it more difficult,' he says.

In 1993 sales were up 10 per cent. This year the increase is so far around 6 per cent, although July figures were up 15 per cent. The average customer spend has crept up over the last few years, from pounds 11.85 in 1992 to pounds 14.07 in 1994.

Mr Lloyd attributes the success of the garden centre to its disciplined approach to management and marketing. He has also introduced scanning at the check-out, something of a rarity among garden retailers, and is therefore able to track customer spend very precisely.

Technical whizzbangery and promotions, however, do not sell products, especially in a recession. Fortunately, says Mr Lloyd, 'plants are proving to be a winner as long as we maintain value'. Having an on- site nursery helps. 'We grow 40 per cent of the plants that we sell in the centre.'

Like any other retailer, Mr Lloyd is keen to protect margins on goods sold. But he also emphasises the quality of advice his 80 staff are able to offer, even though this means higher wages. 'Our wages to turnover margin is around 18 per cent compared to around 6 per cent at an average DIY shed.'

Despite his success, Mr Lloyd is well aware that garden retailing is not a bed of roses. 'The larger DIY retailers have taken market share. They have a restricted range but can move significant volume,' he says.

'DIY sheds attract young home- starters whose gardening purchases are ancillary to pots of paint. As they mature, they become more adventurous in their gardening needs. But DIY sheds can't offer the ambience, ideas and advice that garden centres have.'

Competition from the large chains has forced garden centres into thinking big themselves and beefing up their purchasing power.

One route to this has been the formation of buying groups. 'We co-operate with 20 garden centres in a marketing forum called the Tillington Group,' Mr Lloyd says. 'We negotiate as a group, and it demonstrates that a small number of like-minded people can make progress.'

Today's change to Sunday trading rules will lop one hour from Cadbury's opening times. This may not sound much but, says Mr Lloyd, 'Sunday trade accounts for about 30 per cent of our business.' Another change he is unhappy about is the new rule preventing opening on Easter Sunday. 'That is the critical one, as it is seen as the traditional start to the season.'

Overall, however, Kenn Lloyd takes a philosophical view of the changes, which tidy up the rules. Despite other retailers being open on Sunday, he believes his centre will retain its loyal and local customers. They are not, he says, 'viewer shoppers' likely to be lured away by the prospect of an extra day wandering around shopping complexes.

(Photograph omitted)