NAICS 111421 Quarterly Industry Report
Nursery and Tree Production
Comprehensive industry research for valuation professionals, business owners, buyers, and lenders
NAICS Code: 111421Sector: Agriculture, Forestry, Fishing and Hunting (11)Updated: Q1 2026
About This Report
This Fair Market Value industry profile for NAICS 111421 provides business owners, buyers, and valuation professionals with sector-specific benchmarks and market context for nursery and tree production operations. Additional data is drawn from Bureau of Labor Statistics[5].. Content is compiled from USDA NASS[3] horticultural census data, USDA ERS[4] market analysis, and SBA[6] regulatory filings to support informed valuation and transaction analysis.
Industry Definition & Overview
Nursery and Tree Production (NAICS 111421) encompasses establishments primarily engaged in growing nursery products, nursery stock, shrubbery, bulbs, fruit stock, sod, and short-rotation woody trees with growth and harvest cycles of ten years or less [1]. The U.S. nursery and tree production sector represents a roughly $30 billion total addressable market growing at a compound annual rate of about 4.2 percent, with more than 3,000 active establishments nationwide [2]. Production spans a wide range of plant materials including ornamental trees and shrubs for landscaping, container-grown plants for retail garden centers, bare-root seedlings for reforestation, and specialty stock for commercial orchards[3] and vineyards. California, Oregon, Florida, and Texas lead national production by value.
Nursery operations range from small family-run growing operations on a few acres to large wholesale producers managing hundreds of acres of container yards, field-grown stock, and greenhouse propagation facilities. The industry is capital-intensive, requiring sustained investment in land, irrigation systems, shade structures, container growing infrastructure, and specialized equipment for planting, harvesting, and transporting living plant material. Revenue is influenced by residential and commercial construction activity, landscaping demand, municipal and institutional planting programs, and consumer spending at retail garden centers. Key challenges include labor availability and costs, water access and drought restrictions in western states, pest and disease management, and the logistics of shipping perishable living products across regional and national distribution networks. Per USDA ERS[4] analyses, the sector is also increasingly influenced by consumer trends toward native plants, drought-tolerant landscaping, and pollinator-friendly garden design.
What's Included in This Industry
- Ornamental tree and shrub production
- Container-grown nursery stock operations
- Field-grown shade and flowering tree production
- Fruit tree and vine stock propagation
- Sod farming and turf grass production
- Bulb and perennial plant growing operations
- Short-rotation woody tree production for pulp
- Seedling and transplant nursery operations
NAICS Classification Hierarchy
| Level | Description | Code |
|---|---|---|
| Sector | Agriculture, Forestry, Fishing and Hunting | 11 |
| Subsector | Crop Production | 111 |
| Industry Group | Greenhouse, Nursery, and Floriculture Production | 1114 |
| NAICS Industry | Nursery and Floriculture Production | 11142 |
| National Industry | Nursery and Tree Production | 111421 |
Related NAICS Codes
| Code | Description | Relationship |
|---|---|---|
| 111422 | Floriculture Production | Floriculture production establishments that share greenhouse infrastructure, growing techniques, and retail distribution channels with nursery operations |
| 111419 | Other Food Crops Grown Under Cover | Other food crops grown under cover that use comparable greenhouse and protected-culture growing systems and climate control technology |
| 111411 | Mushroom Production | Mushroom production operations sharing controlled-environment agriculture techniques and indoor growing infrastructure with nursery greenhouse facilities |
| 115112 | Soil Preparation, Planting, and Cultivating | Soil preparation services providing site grading, drainage installation, and growing bed construction for commercial nursery field and container operations |
| 115114 | Postharvest Crop Activities (except Cotton Ginning) | Postharvest crop activities including plant grading, sorting, balling, burlapping, and packaging services for wholesale nursery distribution |
| 561730 | Landscaping Services | Landscaping services that represent the primary customer base for wholesale nursery stock and form the main distribution channel for ornamental trees and shrubs |
SBA Lending Summary
296
Total SBA Loans
$218.9M
Total Loan Volume
$740K
Average Loan Size
12 yrs
Average Loan Term
10.02%
Average Interest Rate
6,496
Jobs Supported
Source: SBA 7(a) Program Data, U.S. Small Business Administration — FY 2025[2]
Key Insight: The SBA[6] classifies Nursery and Tree Production under NAICS 111421 with an annual receipts size standard of $3.25 million [3]. Operations at or below this revenue threshold qualify as small businesses for federal procurement preferences, SBA-backed loan programs, and agricultural support initiatives. The majority of U.S. nursery operations fall within this threshold, though large wholesale producers in key growing states may exceed the small business classification. Eligible businesses can access SBA 7(a) loans[7] for working capital, equipment, and acquisition financing, while 504 loans[8] support major fixed-asset purchases including real estate and heavy machinery.
Top SBA Lenders
| # | Lender | Loans | Volume | Avg Loan |
|---|---|---|---|---|
| 1 | PlainsCapital Bank | 32 | $50.7M | $1.6M |
| 2 | City National Bank of Florida | 24 | $39.2M | $1.6M |
| 3 | American Bank National Association | 8 | $36.7M | $4.6M |
| 4 | The Huntington National Bank | 40 | $35.4M | $885K |
| 5 | First Commonwealth Bank | 40 | $17.1M | $427K |
Frequently Asked Questions
Common questions about this industry.
What products are classified under NAICS 111421?
NAICS 111421 covers establishments growing nursery products including ornamental trees, shrubs, and hedging plants for landscaping, container-grown and field-grown nursery stock, fruit tree rootstock and vine stock, sod and turf grass, bulbs and perennial plants, and short-rotation woody trees for pulp or reforestation [1]. The U.S. Census Bureau[9] distinguishes nursery production from floriculture (111422), which focuses on cut flowers, potted flowering plants, and bedding plants.
What is the SBA size standard for nursery operations?
The SBA sets the small business size standard for NAICS 111421 at $3.25 million in average annual receipts [3]. Operations meeting this threshold can access federal small business contracting set-asides, SBA-guaranteed lending programs, and disaster assistance. Per SBA regulations[10], receipts are calculated as a multi-year average of gross annual income.
How large is the U.S. nursery and tree production industry?
The U.S. nursery and tree production sector has a total addressable market of roughly $30 billion, with a compound annual growth rate of about 4.2 percent [2]. Per USDA NASS[3] census of horticultural specialties data, more than 3,000 active establishments operate nationwide, with California, Oregon, Florida, and Texas leading production by sales value.
What drives demand for nursery products?
Primary demand drivers include residential new construction and remodeling activity, commercial and municipal landscaping projects, highway and infrastructure beautification programs, and consumer spending at retail garden centers. Housing starts and home improvement spending correlate closely with nursery sales volume. Per USDA ERS[4] agricultural market research, consumer interest in native plants, drought-tolerant landscaping, and outdoor living spaces has created new demand segments within the broader nursery market.
What are the key valuation factors for nursery operations?
Nursery farm valuation depends on growing capacity (acreage, container yard space, greenhouse square footage), inventory value and plant variety mix, water rights and irrigation infrastructure, customer concentration and contract base, geographic location relative to major construction and landscaping markets, and land value in the surrounding area. Operations with diverse product lines and established wholesale relationships typically command premium valuations compared to single-product specialists.
How does seasonality affect nursery operations?
Nursery sales follow strong seasonal patterns, with spring and fall representing peak shipping and sales periods aligned with planting seasons in most climate zones. Revenue concentration in these periods creates cash flow management challenges, as production costs accrue year-round while income arrives in concentrated windows. Southern and western growers benefit from longer selling seasons and the ability to ship during months when northern operations are dormant. Per USDA NASS[3] survey data, many nurseries have expanded into container growing and retail direct-sales channels to smooth seasonal revenue patterns.
What labor challenges face the nursery industry?
Labor represents one of the largest operating costs and most persistent challenges for nursery producers, with seasonal demand peaks during planting and shipping periods requiring temporary workforce expansion. The H-2A temporary agricultural worker visa program has become a primary labor source for many operations. Wages, worker housing requirements, and regulatory compliance costs associated with agricultural labor programs directly affect operating margins. Industry automation investments in container handling, robotic transplanting, and irrigation management aim to reduce per-unit labor requirements.
What role does water availability play in nursery production?
Water is a critical resource for nursery operations, particularly for container-grown stock requiring frequent irrigation throughout the growing season. Drought restrictions, water district allocation policies, and groundwater sustainability regulations in western states directly constrain production capacity and operating costs. Recycling irrigation runoff and adopting precision irrigation technology have become standard practices at modern nurseries. The USDA Natural Resources Conservation Service[11] provides cost-share programs supporting water efficiency improvements for horticultural operations.
Sources & References
Government datasets and editorial sources used in this report.
- [1]U.S. Bureau of Labor Statistics, Quarterly Census of Employment and Wages bls.gov
- [2]U.S. Small Business Administration, SBA 7(a) Loan Program Data data.sba.gov
- [3]specialty stock for commercial orchards nass.usda.gov
- [4]USDA ERS ers.usda.gov
- [5]Bureau of Labor Statistics bls.gov
- [6]SBA sba.gov
- [7]SBA 7(a) loans sba.gov
- [8]504 loans sba.gov
- [9]U.S. Census Bureau census.gov
- [10]SBA regulations sba.gov
- [11]USDA Natural Resources Conservation Service nrcs.usda.gov
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