Back to top

Greenhouse Crop Budget Resources

Printer-friendly version

The first step in cost accounting for a business is typically to divide expenses into two categories: Variable and Fixed. Variable expenses, also called direct or allocated expenses in some situations, are those that vary with the amount of crop you are growing. Variable expenses typically include pots, plugs, seed, substrate, labels, chemicals, etc. Fixed costs are those expenses that have to be paid whether or not a crop is produced, including depreciation, insurance, marketing, management salaries, etc. One method for allocating fixed costs to individual crops is called the dollars per square feet week method ($/ft²/week). The total fixed costs are divided by the total amount of useable space in the greenhouse by the number of weeks the space is used. Greenhouses that keep their spaces full and grow crops in a fast, efficient manner tend to be more profitable, which is reflected by a low $/ft²/week figure. Some growers use $/unit (flat, pot, basket, stem) and divide total fixed cost by number of units. Other use $/unit labor and divide total fixed cost by number of hours or dollars of labor. Either of these methods may be easier for you to use or may make more sense for your operation.

For more information see the following article published in "Greenhouse Grower" magazine:

Resources for developing budgets and yield information for various greenhouse crops:

Compiled in 2011, reviewed 2015

Commercial Horticulture
Commercial Horticulture topics: 
Business Management