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About Siletz news letter. (Siletz, Oregon) 1989-1997 | View Entire Issue (June 1, 1992)
keep you starving» oy not giving you much money for your product John stated this is why he was interested in M ik e ’s interest, as well as Wayne’s to talk to somebody to help us change markets. John Baker reported to the Commission that they went to visit Jim Clark o f Teufel’s, and one thing they found in Jim is he is a fellow with a lot o f experience in the very business that the Evergreen Enterprise has been in. John stated that Jim knows the markets. John stated he thought one o f the more interesting figures happened to be that in Western Europe where there is a big market, the same gross sales in terms o f greens o f about $30 m illion as opposed to the United States o f $30 million, here there are about 1200 wholesalers and there, there are 12 big wholesalers, and Jim’s point is that if you can get hooked up w ith one o f those big wholesalers, with the same organization you have, you can probably at least have a chance to nail down one o r two big markets that would give you the margins you would need to make it a profitable product. John stated he does not see where you could get the market, in the wholesale market, as it is now. John stated that when they went to Seattle the valuable thing they learned, by a process o f elimination, was that we are not going to make a niche in the wholesale market as it is, there are already well established wholesalers in the big Seattle metropolitan area, there are established wholesalers in the Portland area, and some o f these are the people we sell to. John stated you would have to compete against them, you would have to re-equip, you would have to have trucking, you would have to have a lot o f things to compete in that m arket John stated that by process o f elimination they came to the conclusion, given that you have a really good crew on the Evergreen Enterprise, you have the thing set up, you have the product, and you have the people w illing to get the product to you, where could you find a way to make money with this same enterprise. John stated he feels there were two that they pointed out, and certainly Jim Clark is in the middle o f those, or somebody like Jim Clark, and one o f them is you could direct sell to florists in the U nited States. John stated you would have to do some advertising, and then you would ship by a ir freight. John stated you could basically do this through m ail order and phone calls. John stated he feels Teufel’s sees a relationship that could be helpful to them, and could be helpful to the Evergreen project John stated that what Jim C lark sees as the big business for the Evergreen Enterprise is basically the salal, this is the big seller. M ik e stated this would be bear grass, too. T im asked John where he got his information on the market potential o f $30 million. John stated this came from Teufel’s, they’ve got the data and they have the figures on i t John stated the other thing is that there would be an expense if you were to really check out the European m ark e t the projected amount for this is $10,000. John stated you would probably want someone like Jim Clark, that is a veteran in the field, to go over and do something like th a t John stated it would seem like the number one option would be the European market, and the number two thing would be some kind o f direct June 1992 sales. John stated he has helped people do some o f this, and knows it is possible. John stated that if you did this second part you would probably have to think a little bit about diversifying. John stated that Wayne has suggested some things to him that are very interesting, like dried plants because the dried flowers are very big. John stated that certainly the most obvious thing is, as constituted it would be veiy difficult to make the kind o f profit you would want to make. . J o h n stated that reconstituted, in terms o f markets, it could be very productive and veiy profitable. M ike stated first o f all, he would like to say that Jim Clark did not volunteer to go to Europe, we asked him if he would be interested in going. M ike stated to the Commission that if you look at those figures for the first three months that Jeff prepared for you, he said that you would need to operate o ff o f a 35% margin, but what you have been having is a 1.78% margin. M ike stated that if you wanted to look at it that way, you would have to increase your sales, over your cost o f goods sold, by about 32%. M ike stated this means you would have to get away from what you have been selling to in the past because your price o f product collected is not going to change at all. M ike stated your labor costs are not going to change at all either, except go up if you have more production. M ike stated you have to get into something where you can get more revenues for the sales. M ike stated he feels that 35% is a margin that you have to have, just to break even. M ike stated that even at that you would have a 7% return on investment, so it is not a lucrative market. John Baker statedg there is one other thing he was going to say, and this is just sort o f a sideline to the reason he is present, but when they were up in Seattle one o f the visits they made was to the Food Editor o f the Seattle Times, whose wife is a gourmet food wholesaler. They found out from this visit that the gourmet vegetable market has been really good for several years, and all the predictions are that it is going to be outstanding. John stated this is not a real expensive thing to get in to, given the portable nature o f greenhouses. John stated there is a veiy strong market, it’s growing, and there is room in it for a lot more people than are currently in it, for certain kinds o f products. John stated he thought he would relate this to you because he knows you are looking for whatever Enterprise that seems to be lucrative and good. John stated this is certainty one that could be beared to look at a lot more, and costed o u t John stated it looks veiy promising. M ik e stated that Jim Clark also said that there is definitely a potential for a controlled environment market for salal. M ike stated it would not be greenhouses, it would be field grown where you would control h e a t and water. John M ille r stated this would be where you would control the growth, everything you would get on top eveiy year is pickable and sellable, where out in the wild you have other factors. John Baker stated that Jim Clark said that if you ever got into the European market you would be forced to go into some kind o f controlled growth like th a t Dan Rilatos stated his question to John Baker is, what would he do right now in this situation. 2 1 John stated he feels you have the production capability, without any changes, to get the same kind o f level o f product you have now, all you are looking for is a market. John stated he feels you have a good chance to do something, given the people that can look at it. Dan V an O tten stated to John baker that one o f the things he had hoped we were going to get out o f the work that you and Wayne were doing was some information about markets, a feasibility. Dan Van Otten stated to John that he does not see this in there. John Baker asked D an what kind o f feasibility and what kind o f market. Dan Van O tten stated that even in the scenario that you provided here, the customers that are listed as potential markets are customers-that we have dealt with in the past, which have turned out to be pretty bad customers. Dan stated he has yet to receive anything that indicated that there is a market. John Baker stated there isn’t really a market for the way you are constituted, and this is why they went to Seattle. John stated they went to 5 o r 6 wholesalers, they called other wholesalers, and found there is no market the way you are currently constituted to make a p ro fit John stated that it is just not there. M ike stated that what he (Jim Clark) is saying is that if you want to roll the dice for another $10,000, then you would be able to go over to Europe and find out if there is a market there. Dan Van O tten asked i f the $10,000 going to include information about how we are going to access that market, in terms o f product M ike stated yes. Dan Van O tten stated that at this point he would like to see in writing, exactly what we are going to get out o f that $10,000 investment D an Van O tten stated that i f this is just some short write up about who was visited and what they said, then he would not be veiy interested. M ike stated that Jim said he would either come back with contracts o r he would come back with no m arket L illie asked why hasn’t Teufel, since they are so big, hit that m arket John M ille r stated they are not into greens. John stated they are not in this business, they are nursery people, Christmas wreath people, and that sort o f thing. John stated that their function in this is actually to get us to help supply them the greens they need for their Christmas stuff. Bud stated that what they might do is go and find out about the market, and come back to us and say they would want us to supply them. M ik e stated they made the decision not fo get into the market, and what Jim Clark is saying is that i f you want to take the plunge you can do it, and we w ill help you do that, if you w ill pay, us.
