Scotts to sell Smith & Hawken?

txt_logo_smg.gifAccording to The Minneapolis-St Paul Star Tribune, "Smith & Hawken, the upscale retailer of garden furniture and supplies, will close two of its three Twin Cities-area stores at the end of this year." Scotts Miracle-Gro, the parent company "reported declining sales and continuing losses for the chain. In a recent conference call with analysts, executives described Smith & Hawken as 'a drag on earnings.' They said they were reviewing under performing stores and the catalog strategy and were considering selling the chain, which was acquired in 2004." This is not news to us here. We talked about Smith and Hawken and it's parent company Scotts here.  In that post I said, "As a small independent garden center owner it’s kind of fun to watch huge corporations like Scotts try to reinvent themselves as cutting edge ‘hippies’. They may be successful in luring many new customers and regaining some momentum but they will never again have the interest on the garden enthusiasts who look for the cutting edge and are the ones who spread the word when they find a truly novel idea."

Smith and Hawken is not closing, but Scotts wants to return to it's "roots" According to Morningstar analyst Ben Johnson, " 'We have always held that [Scotts] venture into the outdoor living category marked an unwelcome departure from its core competencies' of lawn and garden care products."

So there you have it. Scotts is doing the right thing by getting out of Smith and Hawken and returning to what it does best. Meanwhile Smith and Hawken plans on opening bigger stores. We have a 10,000 sq.ft. store opening near here in Sacramento.  They feel "The larger size allows more room for full displays of outdoor furniture and garden-inspired home decor."  I am not so sure this will work. It really depends on whether they can find a buyer for the chain and whether they can regain the "vibe" the brand once had.

It all comes down to what I said back in March 2007, " More often than not these days many people make purchasing decisions based partly on a companies 'authentic story'. Many small garden centers have what Gordy Erickson (senior vice president)wishes Smith & Hawken still had, an interesting and authentic story." When large corporations buy smaller niche companies the smaller companies loose that authenticity. The outside apperances may be the same, but behind the scenes corporate mind set takes over and the vibe changes.