Profile: JOHN HILL Founding president of Nu-Gro Corporation "The Gambler"

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1 Profile: JOHN HILL Founding president of Nu-Gro Corporation "The Gambler" Like any good card player, John Hill knows the strength of his hand, the potential to make it better, and most importantly, he knows when to play his cards. Hill's innovative and strategic leadership style and focus on teamwork helped create and support Nu-Gro Corporation, Canada's leading supplier of fertilizers, pest control and horticultural products. His perseverance and open enthusiasm carried his company through its fledgling years as a middleman in the lawn and garden supply chain. However, it has been Hill's ability to see the whole picture and to recognize when it is time to change direction that has continually brought him, and the company, success. He has made several big changes in his 21-year career history, first to strengthen his own position and later, to strengthen his company's. He made a move in 1981, leaving his five-year career with C-I-L for an opportunity to establish a fertilizer division with Maple Leaf Mills. Three years later, he shifted once again, starting up a sales agency and consulting firm, brokering products at the wholesale level at a time when the margins made this a profitable endeavour. Then, in 1988, he made another move, gathering a group of investors together to found the Nu-Gro Corporation, working to create a "one-stop shop" in the lawn and garden market for retailers across the country. Seven years later, with Nu-Gro losing momentum, and profitability, Hill and his management team transitioned once more-resulting in phenomenal growth, impressive profits and encouraging stability for the company. "In 1995, we recognized that the industry was becoming more competitive," Hill said, reflecting on the strategic shift he implemented that year. "We decided that we had to increase our presence in the consumer end of the business and that we had to integrate the production of the raw materials into our operations. Otherwise, we risked being squeezed out of the market. "A few key members of our present-day team were already with Nu-Gro at the time. Together, we successfully acquired a slow-release nitrogen manufacturing operation in New York State the next year." That new endeavour, spearheaded by Hill, created a new stream of business for Nu-Gro. While the plant in Gloversville, N.Y. produced raw material for the

2 company's own products, it also developed into a supplier for large American blenders. "It expanded our business into the United States in a big way," Hill commented. "It reduced the seasonality of our business dramatically, because we would sell raw materials in the fertilizer business in the south year-round. It also gave us an insight into the commodity nitrogen business. We are now better able to foresee any trends in the nitrogen business around the world." Since 1995, there have been other significant changes, including the acquisition of the Nitroform and Nutralene brand names in 1996, the purchase of Wilson Laboratories in 1998 and the acquisition of the Scotts Company's Canadian professional turf business in 2000 (now the ProTurf line of products), to mention just a few. But it was the decisive shift, moving from being solely a finished product supplier to become a raw materials producer and supplier that transformed the Nu-Gro of 1995, with $30 million in sales, into a company in 2002 with more than $170 million in sales and an average market share of roughly 25 per cent of all Canadian sales within numerous product lines. And, spinning out of that initial production plant purchase, Nu-Gro has become the world's largest manufacturer and marketer of controlled release nitrogen products for the resale market. The company's turnaround has made it the Canadian turf industry's biggest success story in recent years. It is certain that Hill had no idea that his career path would bring him to this position and stature when he began his studies at the University of Western Ontario, pursuing a Bachelor of Economics degree. It was there that he dove into the roles of sales and marketing with a natural and contagious enthusiasm. Many note that Hill was and is very good at building and maintaining relationships, an attribute that has served him well throughout his career. "John shows a genuine interest in those he deals with," said Jay Pollack, Nu- Gro's vice-president of marketing. "Whether it is another corporate officer at the negotiating table, a customer across the country, or an employee at one of our production facilities, he listens and processes what he hears before responding, whether that response is with words or with action." Hill's enthusiastic and personable approach has served him well in the past few years, as he travels the world, negotiating deal after deal to protect, promote and develop Nu-Gro's presence in all of its product lines and business interests. Hill is quick to point out that his success, and the success of the company, is based on a lot more than the company's deft change in direction in '95. He readily credits his management team for Nu-Gro's ongoing achievements and

3 recognizes the long-term support the company has received from a number of shareholders, some of whom have been involved since the company's inception 15 years ago. Hill considers this brand of loyalty to be a critical element in the company's success and he has ensured that same level of commitment is part of Nu-Gro's corporate philosophy. "Part of our mission is to build trust and loyalty in our business relationships by maintaining a high level of quality, integrity and reliability," he said. "That does not happen through making smart acquisitions, but happens by providing highquality, dependable service and a focussed commitment to all our stakeholders, whether they be large companies, retailers, consumers or golf courses." Nu-Gro has put those words into action in its consumer lawn and garden business, differentiating itself by providing a distribution chain that has the company shipping an array of lawn and garden products directly to retailers across the country; fully servicing Canadian Tire, Rona, Home Hardware, The Home Depot, Wal-Mart and many other national retail chains. On the professional side of the operation, Nu-Gro also services customers directly or through distributors. Most recently, Hill and his colleagues inked a deal with Turf Care Products Canada in July, making that well established company the key distributor of Nu-Gro golf course products in Ontario. "Our team works closely with our golf course clients to ensure we understand their needs, so that we can provide the customized service they require to keep their courses healthy and their golfers happy," Hill said. "The golf course business is very important to us, representing the majority of our professional product sales [33 per cent of the company's annual Canadian sales], and we want to do all we can to earn the trust and loyalty of the industry." As illustration of Nu-Gro's focus on the turfgrass industry, the company acquired the only facility in North America-one of only three in the world-that produces the slow release nitrogen product IBDU, an essential ingredient in many of its professional products. More recently, the company built a manufacturing plant dedicated solely to the production of Nutralene. As a result of this commitment to relationships in golf, Nu-Gro and the NGCOA Canada recently renewed their agreement as preferred Golfmax suppliers, offering discounted pricing on fertilizer to the over 900 NGCOA member facilities. In addition, Nu-Gro has been able to establish an exclusive fertilizer supply agreement with ClubLink, the largest golf course operator in the country. With an eye to gauging turfgrass maintenance needs at all courses, Nu-Gro has been developing a sophisticated database of information and research that includes soil testing, irrigation water analysis and tissue sampling. The result of these efforts is expected to be a nutrient management planning program to help

4 superintendents make purchasing and product choices based on a detailed natural history of their courses. Working with the Canadian Turfgrass Research Foundation and the Guelph Turfgrass Institute, Nu-Gro is also involved in research on a natural product for controlling snow mould. Now into its fourth year of development, Hill hopes to have the product ready for commercial production and sale in the next 12 to 24 months. Nu-Gro has also dedicated resources to natural and organic product lines for several years now. Historically, there was low consumer demand for the products, but velocity has picked up slightly in the past two years. That said, sales of the Green-Earth natural and organic product line continue to represent a small portion of the company's annual sales. This is an interesting time for Nu-Gro and other companies to be involved in the turf maintenance and lawn and garden industry. On one hand, demographics suggest the future can only get brighter. Golf course construction has been in high gear for some time now and is likely to continue for years to come. As well as taking up golf, the baby-boomer generation has adopted a keen interest in gardening, making it the fastest growing leisure activity in Canada, with more than $4.8 billion in retail sales each year. Conversely, golf course superintendents are working to decrease their reliance on chemicals in the maintenance of their courses. Governments at the federal, provincial and municipal level have been tightening the restrictions on chemical use, and consumers are becoming more and more conscious of the environmental issues surrounding fertilizers and pesticides. Hill sees this as neither a boom time nor a time for the industry to feel threatened. "The pests aren't going away," he said, "And we are in the plant protection business. Independent research clearly indicates Canadians do want these products when they have pests." "We fully endorse using products only when necessary and, in some cases, that may mean preventative use as well," he continued. "We are very much in favour of new reduced-risk products, including some of the ones available in the United States that have not made their way into Canada yet. We are quite excited about some of the opportunities that are going to be presented to us with these new technologies and new active ingredients." Confident that the turf maintenance industry is in a healthy position today, Hill does not see anything changing in the industry as a whole over the next few

5 years. He promises, however, that there will be more changes happening at Nu- Gro. "We are a company that is still aggressively looking at growing, primarily through acquisitions and strategic alliances," he said. "Nu-Gro is in the middle of several acquisitions, looking at opportunities both in Canada and in the United States that could have some significant ramifications in the turf industry." No matter what transformations John Hill and Nu-Gro Corporation experience in the future, they are bound to be innovative and strategic, advancing the growth and development of the company. True to his character, Hill will only make dynamic shifts when the time is right and, given a chance, he will make sure the grass is always healthy and green, regardless of what side of the fence you are on. Bill Steinburg Based in Barrie, Ont., Bill Steinburg is a golf writer struggling to keep his lawn, and his golf game, healthy. He can be reached at bsteinburg@workscomm.ca