What should I check before buying a tractor parts business?

An independent parts business does not have a manufacturer standing behind it. There is no dealer agreement, no guaranteed supply and no parts program to fall back on. What it has is relationships, knowledge and a shelf of stock. That makes the checks quite different from those for a dealership, and the stock and the suppliers deserve most of your attention.

Suppliers and distributors

Ask who supplies the business, how long each relationship has lasted and whether any are written down. Find out which suppliers the business depends on most and whether they would keep selling to a new owner on the same terms. A few calls to key suppliers, made with the seller’s permission, tell you more than a list will.

Catalogue, online and counter sales

Find out where customers actually come from. A strong catalogue or website can reach farms far from the shop, but it also puts the business in competition with larger sellers. Ask who maintains the listings and whether the seller, a staff member or a contractor owns the site, the accounts and the customer list.

Used and salvage parts

If the business sells used or salvaged parts, ask how it buys machines to dismantle, how parts are tested and labelled, and whether it offers any assurance to buyers. Visit the yard. Ask how environmental matters such as fluids and old machines are handled, and have your lawyer advise on any concerns.

Stock age and returns

Parts for older machines can sit for years. Ask for a stock list sorted by how long each item has been on the shelf, and walk the shelves with it. Learn how suppliers handle returns and how the business treats customer returns and warranty claims. Our dealership due diligence guide shows how a dealer’s parts department is reviewed.