With more Americans buying synthetic Christmas trees, the number of “real” trees sold in the $1 billion plus Christmas tree business has declined over the last few years. But tree growers are looking for a way to stem that trend, and they’re doing it by branching out.
Industry-wide, a little north of $1 billion in trees, wreathes, garlands and other products are sold at retail during the holiday season — 25 million trees is the estimate. But that number has fallen over the last few years.
Joe Sharp, the owner of Yule Tree Farms, one of the top five Christmas tree operations in the country, says the issue is a serious one.
On over 3,800 acres in Oregon’s Willamette Valley, 45 miles outside Portland, Sharp’s Yule Tree Farm nurses some 6 million trees, selling between 500,000 and 600,000 at wholesale.
“The artificial tree has become an issue, but no tree has become a bigger issue in my opinion,” Sharp told CNBC.
While baby boomers have been a boon to many businesses, they haven’t had the same impact on the Christmas tree industry. Either tired of the mess the trees create, or traveling to see adult children, the biggest chunk of the population is not buying trees like it use to — something the industry is addressing with a new fervor. They are doing things like shaking the trees in the fields where they are bought to eliminate all those annoying dead needles.
Sharp has taken things one step further.
He is marketing a “designer” tree, separating the best of the best early in the growing cycle, and then coddling them through to maturity and selling them as a branded item. “Oregon’s Noble Vintage” is guaranteed to be fresher, the perfect shape and is sold at a premium through dealers around the country.
“We thought they'd buy it,” Sharp said. “They did, and they pay a little more for it.”
Actually, they pay about one third more. After last season’s roll out, this year is the firs real test for branded trees. The goal for Sharp is to eventually have the premium trees make up 10 percent of the overall market. Right now, they make up about 4 percent of nationwide distribution.