What should I ask about salt storage and supply for a snow plowing business?

Salt is the supply that matters most on the worst nights, so look at how the business secures it. Start with suppliers. Is there one main source or several? Is there a written supply arrangement, and what does it say about delivery times and priority during heavy winters?

Then look at storage. Ask to see the site. Check that it is covered, drained and well kept, and find out whether the business owns it, rents it or uses space belonging to a client or a supplier. If the storage is rented, ask your lawyer to read the lease for renewal and transfer terms. Ask how the business handled shortages in past seasons. Did it have alternatives, or did customers wait? Ask how contract clients reacted, and whether any contracts tie the plower to specific products or response standards. Think about the books. Salt bought in advance and left unused is inventory, and your accountant can tell you how it should be handled in the sale. Ask also about stock left at closing.

Finally, check for environmental concerns around the storage area with your lawyer or an environmental professional.

Key takeaways

• Ask who supplies the salt, in what quantity, and what happens in a shortage.
• Inspect the storage and have a lawyer read any lease on the site.
• Agree how leftover stock is counted and paid for at closing.
• Ask whether storage on a supplier’s or client’s site would carry over to a new owner.