What should I check before buying a farm supply store?

A farm supply store serves farms, so its numbers follow the farm year. That is different from buying a farm itself, and different from a general retailer. Your review should focus on what the store holds, who owes it money, who supplies it and who relies on it. Ask for records, and plan to verify them rather than accept a summary.

Stock that is seasonal or dated

Feed, seed, treatments and animal health products can age, and some are bought ahead of a season. Count the stock with the seller, and note expiry dates, damaged bags and slow lines. Ask how stock is recorded and how often it is counted. Lenders and accountants often want a clear counting method, so ask your accountant which one to agree on before closing. See what to check at a pool supply store for a similar seasonal retailer.

Charge accounts and large customers

Many farm customers buy on account and pay after harvest or sale of livestock. Ask for a list of balances by age, and who is slow. Find out which customers account for the most sales, and whether any are family, partners or about to retire. A store that leans on a few large farms can change quickly if one leaves.

Suppliers, equipment and delivery

Read each supplier or dealer agreement and ask whether it carries over to a buyer. Inspect the forklifts, scales, feed bins and delivery trucks, and ask for service records. Check that rebates and programs the store depends on will continue. The page on supplier rebates and loyalty programs explains why that matters.

People and the building

Staff who know the customers and the products are part of what you are buying. Ask who they are, how long they have stayed and whether they plan to remain. Confirm whether the building and land are included or leased, and what the lease allows. Your lawyer can tell you what to put in the agreement.