What should I ask about a powersports shop’s snowmobile and ATV service business?

Ask for service revenue by month over several seasons. Powersports work tends to bunch up, so find out what carries the shop in the quiet months and whether service fills the gaps or only adds to the busy period. Ask how the shop handles the spring and fall rush, including how long customers wait and whether any are turned away. Long waits can push owners to another shop, so the answer says a lot about capacity.

Next, the people. Ask which technicians do the work, how they were trained and whether they plan to stay. Skilled technicians are hard to replace, and a shop with one senior person is fragile.

Ask about supplier relationships. If the shop does warranty or brand-specific service, find out whether that depends on an agreement with the supplier, and whether the supplier must approve a new owner. Ask for any such answer in writing. Look at how customers come. Are they repeat owners who book storage, tune-ups and repairs, or one-time buyers? Ask about stored machines and customer deposits, since you may become responsible for them. Your accountant can review the service margin, and your lender can tell you how it views seasonal income.

Key takeaways

• Review service income by month across several seasons.
• Ask whether supplier approval is needed for warranty and brand work.
• Find out who holds customer machines and deposits at closing.