Why can't it be fresh produce?: Christmas tree industry makes strong argument for generic promotion

02/14/2011 10:30:28 AM
Tom Karst

If only the fresh produce industry would embrace generic promotion, imagine the possibilities... Well, to give us a flavor of an industry actually seeking to implement generic promotion, here is a comment found on the www.regulations.gov web site extolling the promise of a promotion order. As the comment describes, the industry has warmed up to the idea of generic promotion. Did the fresh produce industry take enough time to consider the benefits before rejecting a promotion order?

The National Christmas Tree Association (NCTA) welcomes the opportunity to submit these comments in support of the proposed creation of a Christmas Tree Promotion, Research and Information Order. NCTA is the national trade association representing the Christmas tree industry. It represents 1,000 active member firms, 29 state and regional associations and 4,000 affiliated small and family businesses that grow and sell farm-grown Christmas trees and provide related supplies and services. It is estimated that those affiliated with the national organization produce roughly three quarters of the farm-raised Christmas trees in the United States.

SUMMARY: NCTA would like to express agreement with and support of:

* The program is needed and adequate industry discussion has taken place.

* An assessment rate of 15¢ per tree sold is fair and equitable for all growers and importers.

* An exemption for those who sell or import less than 500 trees per year will help keep administrative and
compliance costs manageable while collecting on an estimated 94% of the trees sold in the U.S.

* The proposed makeup of the board, including three regions and 12 directors (including one importer representative) allows for good representation from the major growing areas and for the entire industry.

* A delayed referendum to take place 3 years after assessments begin. NCTA would like for USDA/AMS to consider adjustments as follows:

* Applying for exemptions should be required every five years, not annually.

* An exemption for organically-grown Christmas trees is counterproductive

* To avoid competition with existing farm-grown Christmas tree promotion programs, it is important for state and regional associations to have an opportunity to direct how a portion of the funds will be used

* Administrative costs should be capped at 15% as allowed under the 1996 Act.

* Other minor adjustments in wording as noted below.

NCTA Comments on Proposed Promotion, Research & Information Order February 7, 2011

Background: Christmas tree growers and retailers attending an NCTA Conference in San Francisco in February 2008 participated in a Town Hall session discussing the pros and cons of “check-off” programs and whether or not one might be beneficial for the Christmas tree industry. A pre-meeting survey indicated that the majority of NCTA members opposed a checkoff program at that time.

However, after discussing the issue and the state of the industry, attendees agreed that the idea was worth further consideration and asked the Board of the National Christmas Tree Association to appoint a task force to gather additional information about the options and create a draft of what such an order might look like prior to NCTA's National Convention in Des Moines, Iowa in August.

The task force was established, gathered materials and held four informational meetings in the key Christmas tree growing areas of Oregon, North Carolina, Pennsylvania and Michigan. Members of the task force also attended numerous state Christmas Tree Association meetings to discuss the issue and gather feedback. The feedback was used to shape the proposed program, which was then discussed at NCTA’s National Convention in August of 2008.
Additional research was conducted. The Task Force reported back to NCTA’s Board of Directors in early 2009 and in March 2009 NCTA’s board voted to support asking USDA to create a program. The proposed program was delivered to USDA in August 2009 and is the basis for the proposal on which we are commenting. Additionally, NCTA members were surveyed in January of 2010, and asked how likely they were to support a checkoff at 15¢ per tree. Sixty-two percent of members indicated they were likely to support, 17% indicated that they were likely to be opposed, and 21% were neutral or undecided.

Need for the program: In 2004, the National Christmas Tree Association (NCTA) put together a task force to design and implement a Market Expansion Campaign. More than 1,000 people donated more than $900,000 for 2004 promotion and marketing programs. Real tree sales increased. But as with most voluntary programs, growers benefitted whether they contributed to the program or not. By 2007, voluntary contributions dropped to $400,000, and in 2009 they were down to $100,000.

Marketing programs for Christmas trees have had a positive impact on the industry. Between 2004 and 2008, Real Tree sales increased about 33%. However, the consumer purchases of real trees once again have slipped as voluntary funding for promotional programs has decreased.  Also during the past decade, fake tree companies have increased their advertising and gone on the attack against real Christmas trees. The American Christmas Tree Association, a website for a fake tree company claims that fake trees are safer, cleaner, more economical, and better for the environment. Unfortunately, consumers are believing it. One survey showed that for every consumer who said a Real Tree was better for the environment, four thought that a fake tree was better for the environment! Real Christmas trees have a wonderful story to tell and the industry can do wonders to boost profitability and preserve family farms by working together to deliver that story to consumers.

The National Christmas Tree Association understands that this program, if implemented, will be independent of the national association and will operate under the direction of its own board. The Association looks forward to working with that new entity for the betterment of the industry.



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