What should I check about a tree nursery’s inventory age and sizes before buying?
Ask for a stock list by species, size and age, then verify it in the field row by row. Look at the health of the stock, how long unsold plants have been growing and whether the sizes on the list match what customers are actually ordering.
A nursery’s list of plants is only a claim until you have counted them yourself. Ask for the stock list with each species, size or calliper, planting date and location, and then walk the rows with the list in hand. Spot-check rows at random, rather than following the route the seller suggests. Compare counts, labels and condition with what the paper says.
Pay special attention to older stock. Trees that grow past the size customers want become harder to sell, and plants held too long in pots may be root-bound. Ask how the seller handles unsold stock and whether it has been written down in the books. Your accountant can explain how the inventory is recorded and why the book value may differ from what the plants would fetch.
Match the stock to demand. Review a season of sales by species and size, and ask which lines sell out and which pile up. A nursery heavy in slow sellers may need a different plan than one with stock that moves. Check any pest or disease issues, and ask whether movement of plants out of the nursery has ever been restricted by an inspector. Ask to see any records from past inspections.
Key takeaways
- Count the stock yourself, row by row, against the seller’s list.
- Look for plants that have grown past what customers order.
- Compare the stock mix with a full season of sales.
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Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentWhat is inventory
- 02Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 03Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
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