Christmas Tree Sellers Run Into Surprise Covid Costs
(Bloomberg) -- Christmas tree vendors got a jump on sales this year as buyers looking to chase away pandemic blues started the season early. But all that demand may not necessarily translate into fat profits for sellers of evergreens or the farmers who grow them.
“We typically see a wave of buying towards the second week of December, and the day after Thanksgiving people were already out looking for a tree,” said Mike Cruzado, who runs two Christmas tree stands in Brooklyn, New York. “More people are working from home and looking to decorate their place a little sooner,” he said.
River Ridge Tree Farm in Scottville, North Carolina, a wholesale supplier specializing in Fraser Firs, known as the “Cadillac” of Christmas trees, has already sold out for the season. “Demand for us has been great,” said owner Jessie Davis. “We even had to purchase some trees from Washington State and Wisconsin to fill some of the gaps for our customers.”
However, just because more people are buying trees doesn’t mean farmers and independent vendors are making a big profit. The surge in online shopping this holiday season has sent freight costs skyrocketing, which in tandem with rising absenteeism tied to the pandemic has meant the tree industry is paying more overhead.
Approximately 25-30 million Christmas trees are sold in the U.S. every year, according to the National Christmas Tree Association. “People started clamoring for trees earlier,” said Doug Hundley, a spokesperson for the group. “By this weekend, the industry could easily satisfy 90% of all sales,” Hundley estimated.
At River Ridge, however, transportation costs have doubled compared with last year. “It’s absolutely ridiculous. We’re paying close to $10,000 for a truck from Washington state to get to North Carolina,” Davis explained, adding that he’s had to increase his prices as a result. With many orders placed before freight expenses jumped, he found his margins taking a hit.
“I’ve had some trees where I’ve even lost money,” he said.
Overall, his operations “haven’t seen a massive impact” from Covid-19 infections as the company has been diligent with safety precautions, but even the slightest worry of illness makes some employees miss work just to be safe, Davis said.
In New York City, the pandemic has hindered vendors and seasonal workers from Canada who travel to the U.S. to sell trees during the holidays, said Tew Smith, who helps operate a stand in New York with Wisconsin-based Evergreen East Cooperative. Smith said that the company’s workforce was “cut in half” because of border restrictions. “We went from having 65 stands, now we have 30,” he said. “We’ve had good days of sales, usually 10 to 12 trees, but this is a weird year. We’re not sure how it’s going to turn out.”
For independent sidewalk vendors who depend on out-of-state Christmas tree exporters, higher costs are taking their toll. Cruzado said his expenses grew 15% due to freight costs, making margins at his stand in the wealthy Cobble Hill neighborhood of Brooklyn razor thin. Even so, he sells a coveted seven-foot Fraser Fir for under $120 —or roughly $15-17 per foot— a “steal” compared with what a rival a block away is charging, he said.
A Brooklyn native, Cruzado said he’s been selling trees on the same street for 37 years, starting off as “a kid trying to make a buck.” Since then, it’s become about tradition and the spirit of giving, he said.
“This isn’t about the money, especially not this year,” he confides. “It’s been rough for people. A Christmas tree is a little bit of normalcy and hope.”
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