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Hortus Nursery Felled by Bad Finances

Retail: Celebrated high-end gardening business in Pasadena and Orange is deeply in debt.

August 03, 2001|MELINDA FULMER | TIMES STAFF WRITER

One of the region's most highly regarded plant nurseries, Hortus in Pasadena, is closing its doors for good this weekend, forced under by poor financial management and a downturn in garden sales.

The 9-year-old nursery, which also is closing a sister store in Orange that it opened in January, had developed almost a cult following among green thumbs, racked up national awards and often rated a mention in magazines such as Martha Stewart Living and House & Garden.

But after a couple of years of unchecked growth, Hortus found itself deeply in debt because of inadequate tracking of expenses that the company blamed on a flawed computer accounting system it adopted last year.

And as plant sales tapered off this year because of rainy weather and a cooling economy, owner Gary Jones was unable to afford to pay his bills and restock the mix of unusual perennials, rare English roses, herbs and heirloom tomatoes carried at its two stores.

"We were overbuying and hiring, but I didn't know that until six months later," Jones said. When he realized how much debt he had accrued, he was unable to restock the nursery and as the stock dwindled, he says, sales plummeted.

It's a common story in the nursery business for a basically healthy business to be felled by poor bookkeeping and financial planning, gardening experts say. Many store owners are plant enthusiasts who focus more on the plants than the ledger.

Jones closed the nursery last weekend, promising on a recorded phone message a last hurrah of tomato tastings and close-out sales this Saturday and Sunday before shuttering the business for good.

The company's 30 employees, spread between its nurseries and garden design business, will be laid off with no severance and its gardening newsletter Dig, which goes out to about 20,000 subscribers, discontinued.

Its property in Orange will probably be taken over by a tool business next door. The fate of the 1.3-acre property Jones leases on Orange Grove Boulevard in Pasadena is undecided. Jones says he has received a few buyout offers for the company, which would allow him to stay on, but he says those talks are still preliminary. He has not yet filed a bankruptcy petition.

News of the nursery's demise came as a shock to both the nursery's creditors and its loyal customers, who say they turn to the high-end store and its elaborate demonstration gardens for inspiration.

"Anything under the sun that you would consider hard to find or exotic, they would have it or be knowledgeable about it," said Marsha Perloff, a Los Angeles dog trainer who shopped and attended seminars on Mediterranean gardening at the store. "My favorite thing was the pear allee. You walk through this corridor with pears hanging down overhead," she said.

High-end nurseries such as Hortus had been flush when the economy was booming but have been among the first to feel the chill of a downturn. Sales of lawn and garden products are down about 10% this year, according to Bruce Butterfield, research director of the National Gardening Assn., and many sophisticates are beginning to turn to cheaper, high-volume retailers such as Lowe's and Home Depot.

"While gardening doesn't involve a huge expenditure of money, I think a lot of people are postponing purchases or finding less expensive options," Butterfield said.

Although Jones acknowledges that business has declined as the economy has softened, he insists that high-end nurseries still have a place in the market and a core audience of loyal shoppers to sustain them.

"The really frustrating thing is Hortus is a really viable business. It has been profitable in the past, and could be profitable in the future."

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