Chains branch out in tree market Home Depot, Wal-Mart cutting into roadside Christmas stand sales

PORTLAND – Operating a roadside Christmas tree stand has never been a huge moneymaker, and now that the big boys have moved into the market it’s even tougher.

Home Depot, Wal-Mart and other chains have increased their market share. Their low-cost Christmas trees will bring Yuletide joy – and a little extra savings – to a growing number of the more than 30 million homes that display real trees.

The National Christmas Tree Association says 17 percent of Christmas tree sales last year were at chain stores, such as Wal-Mart, Home Depot, Lowe’s and Target. That’s up from 14 percent in 2000, the first year the association began tracking sales at chain stores.

At the same time, sales at “retail lots” fell from 27 percent to 21 percent of all sales last year while purchases from nonprofit organizations remained steady at 15 percent, according to the survey.

Mike Roth, owner of Maine Mountain Man tree farm, shut down his tree stand in Ellsworth in 1999, in part because of competition from Wal-Mart. If he hadn’t, he certainly would have shut down after Home Depot opened last year.

“The unfortunate thing is they use it as a loss leader,” Roth said, referring to the marketing technique of drawing people into a store with lower than average prices for an item in hopes of making up the difference and more when customers also purchase other goods. “They seem to drive out the small guy with low prices.”

The numbers show the clout of the chains.

Wal-Mart now sells Christmas trees at nearly 1,800 stores nationwide, and Home Depot sells trees at all 1,400 of its stores. Home Depot’s sales have been propelled by the company’s decision to begin selling tree decorations last year.

“Christmas tree sales are growing in excess of 20 percent annually over the past two years,” said Home Depot spokesman John Simley.

More grocery store chains also are selling trees. Food Lion, for instance, sells trees at all 1,200 of its stores in the Southeast and Middle Atlantic with sales projected to be $2 million this year, said spokesman Jeff Lowrance.

Some, like Roth, who continues to operate a choose-and-cut farm in Franklin, suggest the might of the bigger stores has hurt some smaller retailers. After all, sales at the chain stores have to come at somebody’s expense, they say.

Not everyone agrees, however. And some think the trend might be a good thing for Christmas tree growers.

There’s debate within the industry about whether it’s a “good thing or bad thing” to have chain stores selling trees, said Jim Corliss, president of the National Christmas Tree Association.

“I think this is good because, after all, they’re selling real trees, and they’re pricing trees very competitively and making them available to everyone,” said Corliss, whose family owns Piper Mountain Christmas Trees in Newburgh.

Jim Heater of Silver Mountain Christmas Trees of Sublimity, Ore., said the chain stores’ growing presence in the tree market is good, for the most part, for the live tree industry.