Several factors can affect the production of Christmas trees from year to year. The two biggest factors our members have faced in no particular order is rainfall affecting the growth of trees and overall production of trees over several years. The other major factor is the drop in demand from a poor economy which will create tree production surpluses and drive prices down to the point where producing particular trees becomes unprofitable.
How It Works
In order to best protect all of our members, we have set up a system which acts as a type of insurance against downturns in the economy for tree production. Year in and year out different factors will affect our members’ profitability. The huge variations in revenue generation is mitigated under insurance like plan. Members pay in based on their production for each given year and money is distributed to members that face particularly low levels of production. We use our own proprietary formula to determine the amount to be paid out and the amount kept in reserve for future years. Since the effects of negative turns in our economy can take years to show through, it is important for our stability and the stability of our members to keep funds carrying forward in the event of another large recession or depression.
Membership Dues & Contribution
A flat fee for membership dues are collected each year. Becoming a member gives you access to our vast array of tree producers information along with our members list and preferred vendors list. The vendors on our list have been vetted and almost always have years and years of history in our industry and have worked with many of our members. We always recommend you go with someone off this list when you are looking for something like new equipment or even administration services like accounting or payroll. Even though we do our best we must still urge you to do your own due diligence on any vendor you plan to do business with; buyer beware. Contribution is a little more complicated than membership dues. Essentially like any insurance policy, the more you produce the more you will pay into the fund. On the other end of the scale, when times get tough you will be eligible to receive more back. The goal is to diversify everyone’s portfolio of production so that any individual set backs are made up with the diversity of the group. We also have a couple of companies that will buy your accounts receivable if you are carrying too much there and need the cash flow to keep your business going. The discount price will vary a lot based on the age of the receivables and your personal credit if you are willing to guarantee a certain amount of the debt. You can consider working with a credit repair company to raise your credit and eventually lower the discount you are giving on your receivables.