What should I ask about a cabinet shop’s lead times and backlog of orders?
Ask for the full backlog list showing each job, its value, deposit received, promised date and stage. Then ask how lead times have changed and why. A big backlog is only good news if the shop can deliver it on time with the materials and crew it has.
Request the order list and tie it to deposits actually received. Ask what portion of each job is already paid for, and what the shop owes in labour and materials to finish. Deposits held for unfinished work may become your obligation, depending on how the sale treats them, so ask.
Compare promised dates with real progress. Slipping dates, customers chasing, or rush jobs layered on top of old ones suggest the shop is stretched. Ask what the lead time is now and what it was a while ago.
Look at what limits output: a machine, a finisher, an installer, or material deliveries. Ask which supplier delays have caused the worst slips, and whether the shop has a plan for them. Ask your lawyer how customer deposits and unfinished contracts should be handled in the purchase agreement. Talk to a few customers with jobs in progress, if the owner agrees. Ask how communication has been and whether they feel informed about timing. Unhappy customers in the backlog are a cost, because they may cancel or demand concessions after a sale. Ask how the owner would tell the story of the order book if it were a stranger’s shop, and compare it with what the records show.
Key takeaways
- Get the backlog by job, with deposits, dates and stage.
- Ask who bears the cost of finishing prepaid work.
- Find the bottleneck: machine, finisher, installer or materials.
Related reading
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Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentHow to diversify your supply chain
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