"Gary Mangum is building a 
Budding Powerhouse" August 2003

Where to start?
The out-of-the-box thinking or the in-the-know leadership style? The master merchandizing or the business-building savvy? In less than 10 years, Gary Mangum has pushed his Burtonsville nursery to dizzying new heights, busting old industry standards and creating new ones.

Gary has already arrived at where the rest of the industry is heading. He’s taken it to a new level. He has set the bar,” notes Chris Beytes, editor of GrowerTalks magazine. “The bar is very high now.”

As co-owner of Bell Nursery, Maryland’s largest greenhouse grower, Mangum, 47, has transformed the family-owned firm from a break-even business to a $28 million enterprise that is growing at an annual rate of 30 percent. Mangum looks for sales to top the $100 million mark by 2008.

What’s helped push the firm’s sales streak? Two words: Home Depot. Since 1995, Bell Nursery has captured more and more shelf space in Home Depot garden centers. Beginning next year, Bell will become the single source supplier for annuals and perennials in 54 stores in Maryland, Delaware and Virginia. Meanwhile, the Bell model, so successful here, is about to be copied in hundreds of other Home Depot stores across the country.

“How much better will Gary get? Nothing he does will surprise me. He’s such an innovator, such a standout – a tremendous leader who builds a team better than anyone I know. I’ve told Gary I’ll have to turn my magazine into GaryTalks,” quips Beytes. “Everyone I know in the same kind of business is talking a lot to Gary to find out what the magic is. As Bell Nursery goes, so goes a big chunk of the marketplace.”

When former Gov. Parris Glendening announced mandatory water restrictions for the drought-stricken state last year, he made it clear to the public that he would continue to do his own gardening – and water plants responsibly.

That moment marked a quiet victory for Maryland greenhouse grower Gary Mangum, who had personally prepped the governor’s staff about watering tips and helped hire a lobbyist to avert what could have been a disastrous season for the state’s nurseries.

At the same time, Mangum, co-owner of Bell Nursery, applied for – and won – a $100,000 government grant to promote, as the ads put it, “locally-grown” and “Maryland grown” flowers through a 3,400 minute discounted air time buy on 10 Maryland and Washington, D.C. radio stations. The ads didn’t identify Bell Nursery but they did steer listeners to Home Depot garden centers, Bell’s biggest client. Best yet, Home Depot matched the grant.

“No one I know had [sales] increases that spring with the drought like we did,” says Mangum, who operates the nursery with co-owner Mike McCarthy, his brother-in-law. The all-critical spring season is huge for Bell, representing 80 percent of its annual sales and 120 percent of its profit. “It pushed people to our brand in our stores. It was a coup.” How much of one? During a spring in which the drought dominated the local news, Bell’s sales with Home Depot jumped 43 percent.

In the last year, awards and accolades have almost rushed at Mangum – Greenhouse Grower of the Year, the American Horticultural Society’s first ever Paul Ecke Jr. Commercial Horticulture Award. Think Oscar or Emmy – these are the greenhouse industry’s equivalents. Yet the self-effacing Mangum, clearly one of the field’s luminaries, doesn’t seem all that comfortable in the limelight. “It’s Gary and Mike,” he’ll say. “It’s Bell Nursery.”

Certainly, nothing would work without longtime partner McCarthy, 42, a master of production and shipping.  The two men, who bought Mangum’s parents’ nursery business in 1994, have worked together seamlessly since the 1970s. Remarkably, they’ve never argued. “We really respect what the other brings to this,” says Mangum. “I know in 100 years I could never do what Mike does.”

But, from the beginning, it has been the affable Mangum, a gifted relationship-builder, who has acted as Bell Nursery’s voice, its face. Not surprisingly, Mangum’s entrepreneurial prowess surfaced early on. Between 12 and 16, he raised quail at his Montgomery County home, selling and shipping the eggs by rail to New York restaurants. “Good money,” he recalls. In high school, he took horticulture classes, helped build a greenhouse and sold hundreds of spider plants at $5 apiece. Three years into college, just short of graduating from Towson University, he joined his parents’ retail florist firm.

Mangum’s parents built Bell Nursery in 1977 to support an interior landscape business, which they sold in 1992. By the time Mangum and McCarthy purchased the nursery, it had sales of under $1 million and no clear target market. Weeks after they took over, the company’s longtime grower quit. Bad luck grew worse when they had to throw out that year’s poinsettia crop, some 40,000 diseased plants.

“We realized quickly that two things had to happen,” says Mangum, whose firm lost $200,000 its first year.  “We had to develop a customer base because we had none and we had to get a process in place so that we would not repeat that opening disaster.”

In the spring of 1995, Mangum visited independent garden centers and several hundred of the region’s big box stores – the then dominant Hechinger, Price Club and the new-kid-in-town, Home Depot. At the time, Hechinger had 50 stores, Home Depot, just nine. “I focused on the big box stores. I thought they would drive bedding plant sales,” Mangum says. “But based on what I saw, Hechinger had a miserable product mix, much of it dead and dying. Home Depot had flats with tiny one-inch by one-inch squares and cheap hanging baskets. I don’t think they knew what was out there that they could be selling. Mike and I thought if you could bring service and quality to this scenario you could have instant impact.”

At the start, Mangum thought Hechinger, long a Maryland fixture, would be their retail partner. “The Hechinger buyer came and all he focused on in three hours literally was price. He didn’t focus on the big fat plants we have here,” says a still incredulous Mangum. “He didn’t get that plants come first.”A few weeks later Vince Naab, the New Jersey-based divisional merchant for Home Depot, visited the 14-acre nursery, located off Md. Rt. 29 west of Laurel. “All he focused on were the plants. I said, `Mike, this is the guy.’ He saw what I saw.”

Bell tested its plants - colorful and mature - at the Home Depot in Catonsville. “They were selling plastic baskets for $4.99. We brought in big fat hardy New Guinea impatiens and priced our baskets at $12.96,” Mangum says. “We put in 100, they sold the first day. We put in another 300, they were gone a few days later. I truly believe we help set the trends, at least regionally. We’re responsible for that bigger-is-better sense that’s out there, plants that look good from Day One.”

A combination of teamwork and technology produce the handsome 50 million-plus plants that will be shipped from Bell Nursery this year. Everything from irrigating to transplanting is automated – part of Mangum’s drive to work smart. Example: It used to take a dozen people working a 10-hour shift to transplant 2,000 trays. Now, thanks to some gee-whiz technology from Holland, four people can transplant 8,000 trays during the same period.

And there’s something almost palpable about the teamwork that takes place at Bell, which employs 60. As McCarthy puts it: “Everybody here is on a level playing field. We’re all working in the same direction toward the same goal. We all work a lot of hours. We all sweat. We’re all doing the same thing and that comes from the top down.” McCarthy should know. During the growing season, he’s at the nursery from 4:30 a.m. until nine or 10 at night.

When Bell first entered its partnership with Home Depot, the nursery had less than five percent of shelf space in the garden centers for its annuals and perennials – “the color program,” as it’s called in the trade. That figure has shot up since to 75-80 percent. And this year, in 13 of the region’s 54 stores, Bell has done the unthinkable: It has captured all of the shelf space in the garden centers. Next year, it will best itself when it becomes the sole supplier in all 54 stores.

“Home Depot is holding the supplier more accountable and also making the supplier more of a true partner with the store,” notes Mangum, whose greenhouse operation also serves as the exclusive supplier for 12 Costco stores, itself a $6 million-a-year enterprise. “We are measured on sell-through – what passes at the cash register. With multiple suppliers, it was too difficult to see who was doing what.”

The numbers at the 13 test stores tell the story: At the Timonium outlet, for example, sales of Bell’s plants jumped 77 percent between Feb. 1 and June 13 over year-ago figures. The Ocean City store saw a 106 percent hike; Towson, 51.7 percent; Columbia, 25.6 percent. Meanwhile, the increase in sales has been accompanied by a reduction in markdowns – a win, win. Overall, for the just-ended spring season, Bell’s sales with its Home Depot partner increased 38 percent -- impressive given the rains that put gardening on the sidelines for so many Marylanders.

The ingredients of Bell’s strategy? It goes beyond the fat mature plants and the colorful, easy-to-read signage. With its stellar service Bell has eclipsed the traditional stop-and-drop delivery model by hiring 250 in-store merchandisers, some of them master gardeners, who run gardening clinics, answer customer questions and care for the plants. “In most aspects it just comes down to the service,” according to McCarthy. “I look around at the people I’m dealing with for my own personal services and every time I deal with somebody, I think: `Hell, I could start a new business here.’ It’s as simple as do what you say you’re going to do and exceed expectations. So many people don’t understand that simple little concept.”

During the busy season from March to June, Mangum is no stranger to the stores - on Fridays, Saturdays and Sundays visiting up to eight stores a day, both his own and competitors’.  “The overall package Gary brings to the marketplace is unbeatable. In this business you cherry-pick the best – the best guy at ivy geraniums, the best guy at New Guinea impatiens. We’ve trusted Gary’s quality level across a broad spectrum, which is a lot to ask of any grower,” observes Home Depot’s Naab. “And Gary’s the relationship guy, not only working the Home Depot merchant, myself, but all the operational people in the field. It sets him apart from anybody else I’ve ever seen. And I know he spends more time in our stores than I do.”

Even Mangum confesses he spends too much time on the business – to the detriment, he worries, of his family life. He and his wife, Sonia, have 8-year-old and 10-month-old sons and Mangum has 21-year-old twin daughters from his first marriage. “The biggest challenge for me is on the personal side, being able to interact with your family the way you should. I guess I haven’t been very effective, I’ve just been lucky. It gnaws at me all through the season, Mike too. But it feels like what we’re doing is appropriate from a business perspective right now,” says Mangum. “Our strength is a commitment to success. Our weakness, perhaps, is still feeling like we need to be so hands on. But I’m not comfortable turning over my Saturdays and Sundays in the garden centers to someone else. I want to be there, not someone else.”

It’s not just the front end of the business that Mangum has transformed but at least one critical part of the back end. Over the last few years, he’s established a grower’s network, helping 23 farm families in Maryland, Delaware and Virginia start up greenhouses to support Bell Nursery. In fact, the network’s 19 acres already produce more plants than Bell’s own headquarters. Again, a win-win: The farm families, in the 18 week growing season, are netting between $15,000 and $70,000 apiece while Bell, with no capital investment, has greatly expanded its capacity. Going forward, the network is on track to add four acres a year. As Mangum puts it: “We probably won’t build another greenhouse ever.” Not surprisingly, it is a model that is already being copied.

“Gary really is an unbelievable business person and leader,” notes Katy Moss Warner, president of the American Horticultural Society. “He has this uncanny sense of where the business is heading. He’s constantly punching at the edges not only to grow his own business, but so the industry can grow as a whole.” Merchants call on Mangum regularly, hoping to become the next Home Depot or Costco. But the firm has chosen to solidify its alliance with Home Depot. And with 90 percent of its deliveries within a 65-mile radius, there’s still lots of untapped terrain for Bell. If Bell were to pick up the Home Depot stores in the Richmond/Norfolk market, it could add $7-$8 million in sales the first year. The Philadelphia market would mean another $8-$10 million just for showing up. But Mangum isn’t ready to expand his reach – yet.

“There’s a lot more we can get out of the region. We can do it tomorrow, if we wanted to. It’s our call. Mike and I are strong on controlled growth. I learned that from my father. The key is not the growing part but the merchandizing part. It’s the people part - how to replicate the people success as you move into other markets,” says Mangum. “That said we still feel we are in a business-building mode. There’s still a long way to go.”

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