Are commercial greenhouses profitable?

Are commercial greenhouses profitable? Recent trends in the controlled-environment industry would certainly suggest this to be the case. 

Despite the havoc wreaked by the COVID-19 pandemic across various industries, greenhouse growers appear to be in expansion mode largely due to stay-at-home orders in many areas coupled with food safety concerns.

According to Hortibiz Daily: “Results from Greenhouse Grower’s 2020 Top 100 Growers survey, which covered the ornamentals market, showed that 56% of operations were planning to build more on their current site this year, while 13% were planning to acquire additional locations in the coming year. Steps to improve profitability, including raising prices and streamlining production through automation, have contributed to the ability of growers to invest in the future.”

However, despite there being ample opportunity to start a successful greenhouse business, important details that make or break that success are often overlooked.

What is your commercial greenhouse plan?

Winston Churchill is credited with saying: “He who fails to plan is planning to fail". This applies to your commercial greenhouse operation as much as it would for any business.

When starting your commercial grow it is important to know:

• What the market demand for your crop(s) of choice is, and at what price can you sell your produce at?
• What input costs are involved? Seed, soil, fertiliser, water, climate control, labour, energy, distribution and space costs are important considerations when conducting a thorough and upfront feasibility study before you even consider growing your first crop.
• Scaling your greenhouse business to include a greater variety of crops might seem like a good idea when starting your commercial operation, however, this will increase the complexity of monitoring, managing and controlling the aforementioned cost variables since each crop has its own unique growing requirements. If each crop doesn't receive the attention it deserves your bottom line will suffer.

Commercial greenhouse systems and automation.

Like any business, keeping your finger on the pulse of the variables that affect the profitability of your greenhouse farming business are crucial.

Variables like climate control, irrigation and fertigation need to be monitored and managed to avoid crop loss caused by harmful mismanagement side effects like mould, pests and other unknowns that can reduce your overall yields.

Manual Crop Management

If your greenhouse farming practice relies heavily on manual crop management it's important that proactive systems and checks are put in place for easier monitoring and management. And in this case, manually keeping detailed spreadsheet records of all your inputs and outputs will help you make better decisions to further eliminate wastage and increase productivity.

However, if manual crop management systems are not monitored with a high level of attention to detail, the risks of human error can slip in causing severe losses. Simple oversights like leaving your greenhouse lights on for too long, inaccurate nutrient dosing or watering by estimate can easily eat into your profits.

Automated Crop Management

A well run manual operation can provide good approximations of farming variables and a certain degree of control over potential earnings but when scaling or introducing more crop varieties into the mix, a more modern approach may be needed to remain profitable and competitive in the market.

Manually maintaining spreadsheets just won't cut it in this case. You'll need the right information at the right time to make better decisions on the fly while maintaining a constant level of fine-grain control over input variables.

Thanks to modern technology, these problems can be solved by combining hardware (sensors, timers, vents, heaters, lights, etc), software and wireless connectivity to provide remote control over every aspect of your greenhouse farming operation through an app driven environment.

Monitoring variables like CO2, humidity, temperature and light can be done in real-time while farming operations like irrigation, nutrient dosing, climate control and fertigation can be fully automated from the palm of your hand. What's more, you'll receive all the detailed analytics you need in the form reports, graphs and charts to fine tune your operations and maximise ROI. 

The added bonus is that you, the grower, will have more time on your hands to do what you do best - growing!

This level of automation may appear seemingly complex and expensive but newer products on the market like the HortiMax-Go! have considerably reduced the barrier to entry in this regard.

Do you need help maximising your commercial greenhouse profitability?

Bring your vision to life with SA’s market-leading commercial greenhouse company. Contact us for scalable commercial greenhouse solutions that fit your crop, climate and budget.