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In a Greenhouse Grower commentary, horticulture consultant John Terhesh cautions that faster production does not guarantee a better return on automation. He recommends evaluating whether equipment will change costs, sales, or other business outcomes across the operation before making a capital investment.
Horticulture consultant John Terhesh is urging greenhouse and nursery operators to evaluate automation purchases against their actual business needs, warning that faster work or higher production capacity may not produce lower costs or additional sales. In a report for Greenhouse Grower, he argues that growers should account for how equipment affects labor, demand, use rates and other operating costs before committing capital.
Terhesh describes a hypothetical $80,000 machine justified as a way to eliminate two production-line jobs. If the workers are instead reassigned to other tasks, he says, payroll may stay the same while the business also takes on the machine’s purchase cost. The projected labor saving would not be realized unless the investment actually reduces labor costs or helps generate additional profitable sales.
He applies the same test to added capacity. A machine that enables production of another 100,000 plants a year could create substantial potential revenue at a stated price of $20 per plant, but that revenue depends on having customers for the additional plants. If a grower already produces as much as it can sell, extra output could instead add inventory, carrying costs and scrap, Terhesh says.
Equipment use over the year is another factor in his analysis. Terhesh asks growers to weigh a faster planting machine against the limited period it may be used, giving 30 to 60 days a year as an example. He suggests process changes, scheduling adjustments or removing unnecessary handling may sometimes be alternatives to buying equipment. These are examples and advice in his report, not measurements of returns at a named operation.
Testing Automation Against Real Demand
The central point is that a machine’s output is not the same as a business result. For growers considering a large capital purchase, the distinction can shape whether the investment reduces expenses, supports sales or adds costs without changing the operation’s financial position.
Terhesh says automation can also improve quality, safety and consistency, benefits that may matter even when labor savings or added sales are not the main outcome. His argument is to identify those goals and evaluate them directly, rather than treating speed as proof of a return. The report provides a decision-making caution, not evidence that automation generally fails or that a particular investment will lose money.
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The Business Case Beyond Speed
Terhesh’s report is grounded in the operating choices facing growers who are weighing technology against labor and other business costs. He says rising labor costs and signs of a slowing economy in some markets have led businesses to seek efficiency, while cautioning that the case for equipment should account for the whole operation.
He identifies himself as the founder of DPC Horticulture, which advises nurseries, garden centers and greenhouses on operations and management systems. He also describes himself as a former grower with experience at several nursery operations. Terhesh says he supports automation and has saved millions through automation investments, but the supplied report does not detail those projects or explain how the savings were calculated.
“Just because a machine makes a process faster doesn’t mean it’s making you more money.”
— John Terhesh, in Greenhouse Grower
Returns Depend on Each Operation
The report does not identify a specific grower, equipment purchase or independently measured financial result. Its dollar and production figures are presented as hypothetical examples, so they should not be read as data from an actual installation. It also does not provide a general formula for calculating returns or compare outcomes across different kinds of equipment.
Whether a particular investment pays off will depend on details not supplied in the report, including purchase and maintenance costs, labor arrangements, expected utilization, customer demand and the value of any quality or safety improvements. Terhesh’s examples illustrate risks to test; they do not establish that every reassigned worker or added plant creates a loss.
Build the Case Before Purchase
Terhesh’s report points growers toward a business-wide review before approving equipment spending. That means identifying what will change after installation: whether labor costs will actually fall, whether added output can be sold, how often the machine will operate, and whether process or scheduling changes could address the same problem.
The supplied material does not announce a policy, product launch or scheduled follow-up. For readers weighing a purchase, the immediate next step is to test the investment’s assumptions against their own operation and account for costs and benefits beyond the workstation where the machine will be used.
Key Questions
What is the main warning in Terhesh’s report?
Faster production does not by itself guarantee a financial return. Terhesh advises growers to determine whether equipment will actually reduce costs, support profitable sales or deliver other valued improvements.
Why might a machine that replaces two jobs fail to save labor costs?
In Terhesh’s example, the two workers are reassigned to other work rather than removed from payroll. If payroll stays unchanged, the business may not realize the labor savings used to justify the machine.
Can increased production capacity raise costs?
It can, according to the report, if the grower cannot sell the extra output. Additional plants could add inventory, carrying costs and scrap rather than revenue.
What alternatives to buying equipment does Terhesh mention?
He suggests reviewing the process, changing the schedule or removing unnecessary handling. Those options may address inefficiencies without adding another machine, depending on the operation.
Does the report argue that growers should avoid automation?
No. Terhesh says he supports automation and has saved millions through investments, while arguing that growers should base purchase decisions on effects across the business. The report does not provide details of those savings.
Source: greenhousegrower.com
