REVIVAL OF A SICK NURSERY

1. Reviving a sick nursery
INTRODUCTION
 A sick nursery is one, which fails to generate internal surpluses on a continuing basis
and depends for its survival on the frequent infusion of external funds
 The liberalisation of the economy resulting into increased competition has added
considerably to the problem of sickness of the business concerns
 If revival measures are not adopted early , the nursery may have at the end of any
financial year accumulated losses equal to or exceeding its entire net worth
INDICATORS OF SICKNESS
 Continuous reduction in turnover
 Piling up of inventory
 Continuous reduction of net profit to sales ratio
 Short term borrowing at high interest rate
 Continuous cash losses leading to erosion of tangible net worth
 Delay in finalization of accounts
CAUSES OF SICKNESS
 Prevention is better than cure is the proverb that reflects the need for knowing the
causes of sickness so that one can plan to avoid the sickness
 Just as human beings, a nursery can either run into trouble even during the
implementation stage itself or develop sickness during its lifetime
 Internal causes are those that are internal to the nursery over which the
management of the nursery has full control
 External causes are those that are external to the nursery over which the
management of the nursery has little control
THE STAGES OF SICKNESS
 Defects in planning and project formulation
 Lacunae in project implementation
 Production related problems

2.  Inefficient marketing
 Financial constraints
 Issues related to general and personnel administration
DEFECTS IN PLANNING AND PROJECT FORMULATION
 Most of sickness is attributed to ill-conceived projects and inadequate planning
 A project that may, prima-facia present a rosy picture may have many hidden pitfalls
 Irrational , over-optimistic decision may result in choosing projects that may have
inherent weakness
 The existence of a few players in the chosen field ,who are doing well, is not always a
sound proof that the project will be a success
 A through and detailed investigation of the project during the formulation stage is
essential
LACUNAE IN PROJECT IMPLEMENTATION
 Delayed implementation gives a project a difficult start
 Long time taken for project implementation results in time overrun which is
invariably followed by cost overrun
 The problem of cost overrun will get more compounded if the finance necessary to
meet the increased cost cannot be arranged in time
PROBLEMS
 The promoter may not be in a position to bring in funds to the required extent in
time
 The cost of different components of project-cost may increase due to price
escalation
 The cost provided for some of the elements of project-cost might have been
underestimated
 There may be delay in getting power connection, water connection , approval from
local bodies , approval from pollution control authorities etc which may postpone
project implementation of production
PRODUCTION RELATED PROBLEMS
 Increase in cost of production

3.  Decrease in quality of production due to defects in performance of persons
employed
 Quality of product not meeting the standards or consumers exception
 Producing more quantity than can be sold , leading to accumulation of stock
 Lack of proper planning of product mix and lack of co-ordination between
production and marketing departments may lead piling up of inventory, which will
only add to the cost of the product
INEFFICIENT MARKETING
 Marketing occupies an important position in the organization of any business unit
 The prime objective of marketing is the satisfaction of consumers needs
 It involves planning and producing to meet customer needs and also servicing the
customers after selling the product
 In the present day situation where buyer’s market has come to stay almost for all
products ,any organization that does not give due importance to marketing is bound
to find its sale turnover taking a downward trend
PROBLEMS
 Introduction of better substitute products by competitors
 Absence of product innovation and new product development
 Failure to maximize the potential of existing products
 Poor and inadequate distribution system
 Failure to meet the agreed delivery schedules
 Absence of correct costing and correct pricing systemfor the products
Financial constraints
 A nursery is sick when it fails to yield reasonable profit to sustain its existence
 There may be several reasons for this sickness but financial constraints constitute a
major stumbling block for success of the nursery
 Finance is considered the lifeline of any business
PROBLEMS

4.  The nursery owner might have chosen a bigger plan which is beyond their financial
capacity , they often resort to borrowing , invariably at higher interest with the hope
of clearing borrowing once the project takes off
 Funding a project with a higher debt component than that it can safety bear is
another reason for sickness
 Improper inventory management policy will lead to holding huge stock of finished
products
ISSUES RELATED TO ADMINISTRATION
 Lack of motivation and co-ordination among staff / workers
 Lack of manpower planning
 Poor industrial relation to labour unrest
 Difference of opinion among the shareholders/partners
 Lack of assigning equal importance to all areas of business
 Projects that solely depend upon the skills of an individual
ANALYSING REVIVAL PROSPECTS
 Once bitten, twice sky before attempting to rehabilitate a sick nursery/unit
 The detailed and thorough viability study is to be undertaken to ensure that the
revival programme will really bear fruits
 The viability analysis shall enquire into the technical , commercial , management ,
financial aspects
TECHINICAL APPRASIAL
 Study the production capacity of different production sections and checkup if the
production capacities of different sections are perfectly balanced
 Explore the possibilities of additional/special feature to the products that will add
competitive edge to the product
 If the locational disadvantage outweigh all other factor , the scope for shifting the
location to an advantageous place may be examined and the cost-benefit analysis
studied

5.  Study the modification required , if any in the nursery layout so that the material or
product handling time can be reduced which may improve the efficiency of
operation and improve the output
COMMERCIAL APPRAISAL
 Commercial failure of a project will be mainly due to problems relating to the
product itself viz., imperfections in product which may lead to consumer resistance
 Such situation indicate that the products offered by competitors have better
features that attract the consumers
 Minor modification in designing and packing the product with upward revision in
price may be accepted by market which brings better income to nursery
 Limiting to a specific groups of plants may restrict the business to a particular group
of peoples , so product diversification may prove to be a feasible solution
MANAGEMENT APPRAISAL
 A good nursery in the hands of an ineffective management becomes sick in due
course of time
 Similarly , a good management is capable of converting a not-so-good nursery into
highly successful profit-making nursery
 The sickness is due to reasons beyond the control of present management or due to
ineffective management
FINANCIAL APPRAISAL
 Reduction in interest rate of existing loans
 Conversion of short term loans in to long terms loans
 Conversion of part of long term loans into equity
 Offering a revised schedule of repayment for the principal components of term loan
 Sanction of additional loan to meet the additional capital expenditure
 Funding of the overdue interest and making it repayable in easy instalments
REVIVAL PROGRAMME
 A nursery that has gone sick would already loss its huge resources
 In order to utilize the assets and infrastructure already created for the nursery ,it
needs to be revived

6.  There is no doubt that the nursery would have had some weak areas which could
have been the cause for the sickness
 Inspite of this, revival the sick nursery is worth considering since the cost of setting
up a new unit might be substantially higher as compared to cost of
revival/rehabilitating a viable sick nursery
ORGANISATION IS THE KEY
 You can increase profitability a great deal by simple organising and planning what to
do in nursery
 Planning should be an ongoing process
 There are basic things which should be asked over and over as constantly review
what nursery is producing or selling, how are producing and how market the
products
REDUCE WASTED TIME
 Doing various tasks manually is not only costlier but also time consuming
 Mechanization of tasks may save considerable time and labour
REDUCE WASTED FACILITIES AND EQUIPMENT
 Owner should only buy extra equipment because it will lead to extra profit
 Sometimes more cost effective to hire some types of equipment , particularly
equipment that , while necessary to the nursery operation, is only used infrequently
REDUCE WASTED MATERIALS
 Be self critical, it is easy for expenses to increase because potting mix gets spilt on
floor, buy too many labels and pots which break over time or damaged if stored
incorrectly
 It is a mistake to just keep buying materials when it need , without having earlier
calculated what requirements should have been
MAKE THE MOST EFFICIENT USE OF LABOUR
 It is important to have suitable trained staff and the right mix of staff
 There is little point in having , for example, staff busily propagating plants , if labour
don’t have the support staff available to care for those plants once propagated, or to
do the marketing and transporting in due time

7. DIVERFICATION
 Diversification may be an effective way of reducing income variability
 It means combining of different production oriented tasks
 For instance, diversification can include more crops in the same production process
or having different types of allied enterprises like supply of gardening inputs , rooting
media etc
 It typically reduce large year-to-year variations in income
 Effective diversification occurs when low income from one enterprise is
simultaneously offset by satisfactory or high incomes from other enterprises
 In worst case, small nursery can minimize production or income generation risk
through diversifying source of income such as opting for part-time off-farm
employment of its labour force and regularly paid staff
CROP INSURANCE
 Crop insurance providing financial security against losses suffered due to crop failure
because of fire , storm, cyclone etc
 Crop insurance is an example of a risk management tool that not only protects
against losses but also offers the opportunity for more consistent gains
 Insurance program protects against yield shortfall by providing coverage against
most natural disasters
 Crop grown under glass, plastic , or other generally fall into high value input-output
category, as such, risk management planning is very important
 Sometimes insurance offer policies, which cover the minimum standards for
construction and material used in the construction
 The changing economic environment has triggered a renewed interest in crop –
insurance and expected that nursery crops would soon be covered by good
insurance schemes thereby improving the chances of revival from sickness
MONITORING THE REVIVAL PROGRAMME
 A sick nursery that is under a revival programme is similar to a sick person who is in
curing stage and needs continuous monitoring
 A simple and practical monitoring mechanism needs to be followed for its speed
revival

8.  A nursery manager will keep an open mind , will continually review the way things
are done in the nursery and look for better , more up-to-date and more profitable
ways of doing things besides decorating the establishment for enhanced attraction
of the peoples
WAYS TO REVIVE A DYING PLANT
 LOCATION:
 Make sure its in the right spot and receiving the sun or shade it requires
 Every plant wants to grow and thrive but if its not getting enough sun or too much
sun its going to struggle
 Moving plants is easier if they are in a pot but if in ground water well begore digging
up and choose a mild day before relocating
SOIL IMPROVEMENT
 Improve the soil around plants
 Soil is the diet for plants and needs to be healthy for plants to succeed
 Improve the soil in new beds by digging through mushroom compost and well rotted
manure
THE RIGHT NUTRIENTS
 Water sick plant well and using a seaweed tonic diluted in water will help to promote
healthy soil and root growth
 Avoid over fertilizing unless see signs of an minerak deficiency.
CUTTING BACK
 Cut back leggy shrubs and remove any dead or dying leaves and branches.
 The majority of plants can be cut back by a third safely and this will help to promote
new growth both above and below the soil
 Removing yellowing and spent leaves and flowers will give the plant space to grow
new ones.
Control the nasties
 Once you have given your plant some love and attention you need to keep the
maintenance to ensure it gets back to full health as soon as possible.

9.  Ensure plant receives the water it needs and fertilize with a slow release fertilizer
and liquid one simultaneously ,around the time to see the new growth and
improvement from plants.
SICK PLANT DIAGNOSIS
 The texas plant disease diagnostic laboratory(TPDDL)
 It gives service and effort of the department of plant pathology and microbiology at
Texas
 It provide the most accurate and rapid plant disease diagnosis together with
recommendation for effective plant disease management
CONCLUSION
 Developing customer-oriented new products
 Staff training for skill upgradation and knowledge enhancement
 Calculating and analysing the profit and resetting price accordingly
 Looking for better prices of raw materials
 Refining propagation methods for each plant variety
 Upgrade equipments for improving production efficiency
 Attending seminars and keeping in touch with current research , trends and
development
REFERENCE
 PLANT NURSERY MANAGEMENT :P.K. RAY
 BASIC HORTICULTURE :JITENDRA SINGH
 NURSERY RAISING :S.N DAS