Stay up to date with notifications from The Independent

Notifications can be managed in browser preferences.

A tribute to flower power

After a gloomy start to the year, Wyevale is blooming again. But Brian Evans, its chief executive, isn't resting on his laurels

Catherine Wheatley
Wednesday 19 September 2001 00:00 BST
Comments

Believe it or not, Britain has just enjoyed one of its better summers in recent years. All through July and August the smell of charcoal and charred meat wafted across patios as a nation unpacked its barbecue equipment and basked in hours of sunshine, up 15 per cent on the seasonal average. Lawns were trimmed, paddling pools filled and plants potted out as the mercury soared to 31C for a few days in July and average temperatures were 7 per cent above normal.

All of which is good news for Wyevale Garden Centres, Britain's biggest horticultural business, which in June was forced to issue a downbeat trading statement after appalling weather at the start of the year. Earlier this month the company reported a strong second quarter with half-year pre-tax profit before goodwill of £14.1m, up from a restated figure of £10.8m for the previous year. Sales jumped 68 per cent to £98m but gross margins fell to 46.6 per cent from 47.7 per cent.

The chief executive Brian Evans, has spent 30 years in the business, launched nearly 70 years ago by his late father-in-law, Harry Williamson, and he has steered Wyevale through flotation to its position as Britain's foremost garden centre company. Two decades of acquisitions and organic growth ended last October with the takeover of his biggest remaining rival, Country Garden Centres.

Mr Evans likes to play down the impact of the garden makeover phenomenon on his business. He says Percy Thrower was showing us how to take cuttings long before Charlie Dimmock bounced onto our screens, but Alan Titchmarsh and Ms Dimmock have significantly improved the sector's profile with both investors and consumers. Younger customers are joining the over-35s, who tend to be the most frequent visitors at the company's 120 outlets, and the average spend of £12 per visit is up 15 per cent over the past two years.

"I don't want to devalue what the programmes have done but they followed rather than created a trend," Mr Evans says. "They are slick and quick and what they don't do is plant many plants. Spending on decking, timber, pots and urns has all increased but they were on a roll anyway."

Since Wyevale's flotation 14 years ago, the company has delivered earnings per share growth of more than 15 per cent a year, a record almost unmatched in the retail sector. What distinguishes Wyevale from its garden-centre rivals is the comprehensive tracking system that enables staff to monitor sales, order the correct quantity of goods and generally ensure delicate plants do not wilt and die before finding a buyer. All the company's stock comes directly from suppliers in Holland, Italy and the UK, and without a central distribution facility the co-ordination required is considerable.

"Horticultural buying is the key to business," Mr Evans says. "It's our largest department. I've always considered that we need retail disciplines to succeed in the garden centre business, and where live and perishable goods are concerned, the discipline required is huge." Last year wastage was just 1.2 per cent of sales.

Actually, gardeners spend relatively little in the second half of the year when their plots are established, and even less in bad weather, when pottering in flowerbeds lacks appeal. So at Wyevale centres, alongside the charcoal and strimmers is the non-horticultural merchandise that seems typical of many garden centres. Tropical fish and toucans are on display yards from outdoor equipment, health food and giftware. There is a craft shop concession, a picture framing service and a restaurant. Mr Evans and his wife were the first to put a restaurant in a garden centre, in the early 1970s.Last year, live and perishable plants and seeds accounted for less than half of Wyevale's revenue. Christmas decorations were 9 per cent and gifts and pets together a further 12 per cent.

The quality of Wyevale's plants and shrubs is also a key weapon in the competition against home-improvement stores that sell gardening goods as a sideline. Customers are likely to come away from a DIY outlet with a pot and a bag of compost, Mr Evans says, but they are far less inclined to acquire their geraniums or roses at the same time.

The combination of clever buying and careful delivery has proved a powerful tool with which to unlock new value. The Cramphorn chain, bought 10 years ago, and Kennedy's, taken over in 1998, have both benefited from a Wyevale makeover, as have several other small companies. For City investors, the next big issue is what Mr Evans will bring to Country Garden Centres, the 39-outlet chain for which Wyevale paid £111m last October. The question is particularly pressing given the profits warning Wyevale was forced to issue in June. Country Gardens has a greater bias towards horticultural goods and so a wet March had a disproportionately big impact on Wyevale's overall revenue.

Mr Evans is confident that he can improve gross margins at the Country Garden outlets, predominantly in the affluent South-east, to match Wyevale's own levels. The product range will be broadened and space will be better utilised. "You can dress your profits up for a couple of years by cutting overheads and trimming recruiting back, but if you do that you will eventually run into problems."

Instead, blooming sales and profits will grow from organic expansion and improving product lines. It is clear Mr Evans intends to be there to watch them flourish.

Join our commenting forum

Join thought-provoking conversations, follow other Independent readers and see their replies

Comments

Thank you for registering

Please refresh the page or navigate to another page on the site to be automatically logged inPlease refresh your browser to be logged in