Bishop and Mathews Newsletter Spring 2019

Hi Folks…

While most customers reported brisk sales, nice trees, accurate tree counts, and on time deliveries last Season, their inability to receive quantities of trees needed affected bottom lines, and was worsened by a lack of local wholesale supplies. Many were forced to close early, turning away customers. Today’s growers are more conservative than in the past. They have learned to limit their planting to what they know they can sell, as opposed to earlier days of speculation and high hopes. Some are slowly increasing planting, but the shortage will continue for some time.

A common complaint was in the overall decrease in sizes offered, compared to previous years. Substituted sizes and/or species on customer deliveries made for some unhappy retail customers. Growers are faced with continually decreasing labor supplies, and ever increasing operating expenses. These factors influence today’s growers planting and harvesting decisions. The decrease in sizes offered is a reflection of this.

Our growers have informed us that they believe they will be able to supply us with about the same overall quantities as last year, but doubt that they will be able to increase our supply this year. We don’t know what specific availability for sizes, grades, and species will be yet.

During our recent trip to the Pacific Northwest Christmas tree growing region, we visited a farm that operates a wholesale yard in the Los Angeles area. We hope to start a relationship with them this year. This could provide our customers with opportunities to pick up additional trees when and if needed. We are in the process of getting specifics on species, sizes, prices, etc.

Getting orders to the farms early was key for us to secure trees on your behalf. Growers typically grade and tally into the Fall, and can’t send us their actual inventories until they have finished, however. It is not until then that we realize the discrepancies that exist between customer order requests and farm actual availabilities, and make adjustments. Some feel that since they already signed agreements and paid deposits that coincide with their original orders/invoices, they should be entitled to receive those exact trees. Getting our orders in early is simply how we make our needs/requests clear to growers, and we can’t place order requests for trees on our customer’s behalf without first getting firm commitments from them. We are updating our Purchasing Agreement to further explain this.

Landed costs for trees did not appear to be an issue for our customers this year. Two growers that we recently met with confirmed that they will be raising prices again this Season. One said he won’t. The others haven’t commented yet.

If we draw on individual shortfalls that customer’s incurred last Season, we hope to make improvements on them this year. By sending us an email ahead of the Season outlining how, when, and why your business and/or customers were negatively impacted last Season, we will be able to address it ahead and in a much better manner this year. Thank you to those that have already done so.

2018 Bishop and Mathews Christmas Tree Forecast

We recently returned from our annual  Spring trek to the Pacific Northwest Christmas Tree growing region. During this trip, we visit as many farms as we can. The growers are pretty rested and relaxed this time of year, so we get some quality time with them. What we learn from them during these visits explains a lot about our current situation as retailers, and also provides us with insight as to what we may expect from the farms in the future.
One grower that we visited told us that he has been increasing planting, and expects to have more trees available starting next year.  We think that overall 2018 availability will be similar to 2017.
It looks like the last few years of grower price hikes have put the farms back on solid ground. We think that prices may have stabilized. An overall shortage still exists, however. The farms that have contracts with big box retailers are still scouring other farms to purchase trees in an effort to honor their own commitments. We don’t think this will affect us any differently than it already has.  We are frequently reminded by the mid sized farms that we buy from however, that filling our orders of mixed species, sizes, grades, and split loads, is more time consuming, complicated, and costly than most of their other customer’s orders. Reading  between the lines, they are telling us that although they maintain their loyalty to us, if we weren’t around, they wouldn’t have to work quite as hard, and would probably make a few more bucks. One grower told us that it can take up to an hour longer to load one of our trucks.
The biggest challenge that the grower’s are facing today is the continually increasing shortage of labor. Another is their continually increasing operating costs across the board. Those that survived the recession and tree glut are having to make changes in order to become more productive and efficient in order to survive in today’s farming environment. One that we know is experimenting with narrowing the taper on some of his trees, to lighten them up and make them easier to handle. This would also reduce freight costs by loading more of these trees in a van, and increase productivity by planting more trees in the same field. We don’t know if or when we may actually see a shipment of trees like this get delivered to a retailer. Another has stopped growing anything over 8 ft., because of their weight and the difficulty of handling them. One grower explained that in the same amount of space and time it takes to grow a 16 ft. tree, he could grow 8  7/8 ft. trees twice. In addition, the risk of damage to them during harvest, baling, loading, shipping, etc, is greater since the branches tend to be more brittle than on others.  We may see a future decrease in the overall availability of bigger trees.
Truck drivers’ hours of service regulatory requirement for trucks to be equipped with electronic logging devices is now in effect.  The new regulations could translate to a decrease in truck availability, and an increase in  freight costs. Unfortunately there is no way to know until the shipping Season actually begins.

Oregon Farmers See Christmas Tree Shortage

Oregon Farmers See Christmas Tree Shortage

As the 2017 Christmas tree season approaches farmers are beginning to see that the over abundance of Christmas trees is no longer on issue.  In fact, it is quite opposite.  Farms are now seeing a shortage in trees faster than they had thought.  Here is an interesting article discussing the Christmas tree shortage in the  upcoming years.

2017 Christmas tree forecast


2017 Christmas Tree Forecast

We just returned from a week long journey through the Pacific Northwest Christmas tree growing region. Much of our time was dedicated to visiting with our current, loyal farms. We also made sure to allocate plenty of time searching for other farms that may be in a position to take on more customers. We returned with some great insight about the 2017 Christmas tree forecast, but did not find any other farms that could take on  new business.

The 2016 Season marked the beginning of an overall shortage of Christmas trees. 2017 inventories will be tighter than 2016. In addition, many growers oversold in 2016 and were forced to cut into portions of their 2017 inventories to honor their commitments, increasing their shortage.

Big box retailers still appear to be the primary market for big farms. They are relying heavily on smaller farms to sell them the trees they need to complete their orders now. Big farm’s buyers are prepared to offer other growers whatever price is necessary to acquire their trees. It looks like most mid sized farms prefer to keep their relationships with their regular customers, however.  Big farms were not able to acquire all of the trees they promised the big boxers in 2016. Maybe the retailers are finally gaining some ground on them.

In light of these and other changing conditions, growers are now weighing against many factors when determining the worth of their regular customers. We speculate that mid sized farms 2017 prices will increase again about as much as in 2016. Several mid size farms will likely eliminate some problem and late paying customers, freeing up some  inventory for the rest.

In an effort to counteract an ever increasing shortage of labor, and rising freight costs, many farms are reshaping their trees to become narrower and lighter. This will reduce labor costs and increase the quantities that can fit in a van. We expect this to be the beginning of a trend that may eventually become the norm for them. Handle sizes are increasing to 10 -12 inches.

A few farms are out of the commodity market altogether. They are mostly family farms that cultivate premium trees on a small scale. By focusing entirely on quality and continually meeting their customers needs, the demand always exceeds their supply. We expect their prices to increase modestly, and their inventories to remain the same.

One can only speculate as to how this will all trickle down. We have been assured that our normal quantities of trees will be reserved for us. However, allocations of some popular sizes will be reduced and substituted with what is left. One farm that we buy many trees from will be down 40% on 7/8 Noble, 50% on 7-8 Douglas, and has no Nordmann over 8ft.  Farms normal practice of outsourcing from neighboring farms to supplement and correctly fill their customer orders may not be much of a possibility in 2017.  We think that premium big tree inventories 14 ft and up will decrease in 2017, and continue to diminish in future years. We expect tree quality to improve now that growers have more dollars to put into them.  Some farms are still working through a bit of distressed inventory left over from the drought.  Retailers may have to deal with them the best they can again since substitutions may not be available. Growers don’t want to be first to release their prices.  They will likely wait as long as possible to release them.

Our strategy of getting orders to the farms early has helped us stay a step ahead of others so far. One would expect that some of our customers will contact other farms and shop for comparable options. We do not want to rush them through their normal decision making process.  However, we are strongly encouraging these customers to perform their due diligence ahead and get the results of their comparisons early.  We need them to be ready to make their educated purchasing decision early, since supplies are limited.

Although most retailers started the 2016 Season with a lot to overcome, most all sold out, many earlier than expected, and most reported an increase in profits over the 2015 Season.  We don’t anticipate the 2017 Season to be much different for most retailers.













April 2015 Newsletter

Attached is our April 2015 Newsletter, which touches on some of the things we can expect in this upcoming Season.

2015 04 Newsletter

February 2015 Newsletter

Attached is our February newsletter. It kind of sums up what we experienced with the overall 2014 tree market, and suggests future trends.

2015 02 Newsletter


July 2014 Newsletter

Below is a link to our July 2014 Newsletter

Newsletter 07-2014 –