Top 2023 trends for horticultural businesses

Added December 5, 2022
Hortica 2023 Industry Trends

By Traci Dooley
National agency sales director for Hortica®, a brand of the Sentry Insurance Group

Let’s start with good news: the horticultural industry continues to grow. According to Business Wire, market size for greenhouses in the United States in 2022 was estimated at nearly $8.4 million and is expected to grow to more than $11 million by 2027.

That said, we expect 2023 to bring its share of challenges along with growth opportunities. The labor problems and supply chain issues we experienced over the past year will likely continue, but newer developments in technology, vertical and indoor farming, and a strong shift toward ecommerce are introducing new ways for horticulture businesses to grow and expand.

Here are some of the developing trends we’re seeing—not only with the businesses we insure, but throughout the horticultural industry overall.

Ecommerce growth

While you likely have some online presence such as a website or an Instagram page, ecommerce is still an untapped marketplace for horticultural businesses. Throughout the COVID-19 pandemic, consumers have developed online buying habits. It’s up to horticulture businesses like yours to develop effective online sales strategies to attract these customers—and battle increasing competition and lagging profit margins.

Advantages of ecommerce

  • Low operational cost
  • Global reach
  • Detailed product information
  • Browsing and buying flexibility
  • Fast sales process
  • Quick response to market demands
  • Targeted advertising

Using an ecommerce strategy to target new markets can help you expand your sales operations and cultivate customer loyalty. If you’ve got the time and talent, try to create your own online community such as #PlantTok, a highly popular grouping of experts who share plant tips via short TikTok videos.

Emergence of the customer experience

Customer experience (also known as CX) is the interaction or experience your customer has with your business through the entire customer journey, from first inquiry to becoming a satisfied customer. While this may not seem like a new trend, it goes hand-in-hand with the immersion of ecommerce and more competition within the industry. 

A survey by Bloomberg BusinessWeek found that providing a great customer experience has become a top strategic objective for the coming years. This focus effects both new and potential customers and is based on the following business advantages:

  • Customers are willing to pay a 13 percent price premium just for receiving a great customer experience
  • 49 percent of buyers have made impulse purchases after receiving a more personalized customer experience
  • Customers that rate companies with a high customer experience score spend 140 percent more and stay loyal for up to six years
  • One in three customers will leave a brand they love after just one bad experience
  • A good customer experience is set to be the number one brand differentiator

Vertical growing shift

In the Greenhouse Management 2022 State of the Industry report,  growers noted they plan to increase edible crop transplants and perennials by 30 percent in 2023. Growers are locating shipping containers near grocery stores, or purchasing warehouses and filling them from floor to ceiling with plants and vegetables.

Introducing vertical farming, indoor farming, or vertical growing to your greenhouse isn’t a major shift since the growing technique relies on temperature, light, and humidity control—elements already well-established in your greenhouse setting. As competition from horticultural entrepreneurs increases, it’s worth assessing your facility to determine whether vertical growing may be right for you.

Smart technology and artificial intelligence (AI)

Smart technology is becoming increasingly important in horticulture. Some greenhouse operations are warming up to the efficiencies of robotics, automation, and artificial intelligence, but many in our industry are reluctant to adapt.

Those who have embraced a more autonomous operation are benefiting from high-quality crops, increased crop production, reduced labor costs, and stronger profits. According to the Commercial Greenhouse Global Market Report, innovations such as AI, automated irrigation systems, pH sensors, and climate control software are key technology trends gaining popularity in the commercial greenhouse market.

You don’t have to go full automation all at once. Test a few efficiencies to see how they fit your operations. Our safety services team can visit your business to conduct an on-site consultation and assess your risks and opportunities.

Labor market and supply chain issues

“We’re hiring” is as common these days as saying “hello.” And waiting for a supply order to be filled has become part of the new normal for both businesses and customers.

While supply chain and labor shortage issues are still holdovers from 2022, there’s evidence they’re improving. As the incoming trends help forward-thinking businesses carve out new ways to do business and garner sales, both the labor challenges and supply chain frustrations show a more encouraging trajectory for 2023.

Choose an insurer who knows the trends

For the sake of your customers, employees, and bottom line, you deserve an insurance provider who understands your industry and can provide customized coverages and safety services to help protect your ever-changing business.

That’s our Hortica brand. We’ve been recognized within the horticultural industry for more than 135 years. Our representatives understand developments in the industry, emerging trends, outgoing business practices, new technologies, and—most importantly—new risks that come with those developments. 

If you have any questions about insuring your horticultural business or would like to review your current policy, contact us today or request a quote.

Related links:

Are you prepared for a speedy business recovery after unexpected downtime or a shutdown? Learn how to create an effective business continuity plan and pair it with insurance coverage that can help protect your bottom line.

Use this greenhouse maintenance checklist to inspect your facility and help reduce your risk of maintenance issues or breakdowns this winter.

Should you bundle business insurance? Our team addresses what bundling insurance means, and how it might benefit your business.

Hortica® property and casualty coverages are underwritten, and loss control services are provided, by Florists’ Mutual Insurance Company, Florists’ Insurance Service, Inc., Edwardsville, IL, or affiliated members of the Sentry Insurance Group. For more information, visit Policies, coverages, benefits, and discounts are not available in all states. See policy for complete coverage details.

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