What should I look at in a food wholesaler’s cold storage setup?
Look at the condition and age of the refrigeration equipment, the temperature records, the backup plan for a power failure, and whether the space suits the product mix. Walk it with someone who knows refrigeration and ask for maintenance records.
Cold storage is often the most expensive and most fragile part of a food wholesaler. Start with the equipment. Ask who installed it, how old it is, what repairs it has needed, and whether a service contract is in place. Look for frost, water on floors, worn door seals and compressors that run constantly.
Then review the records. Temperature logs should be regular and complete, and any gaps or alarms should have an explanation. Ask what happens during a power cut: is there a generator, an alarm that reaches someone after hours, and a plan for moving stock? Ask what stock was lost in the past and how it was handled.
Finally, consider the layout. Is there separate space for different temperature needs, a way to keep raw and ready-to-eat products apart, and room to grow? Check that the space is suitable for the licences the business holds. If equipment is leased, read the terms. An equipment appraiser can assess the value of the assets, and your accountant can weigh replacement costs against the price. Ask the seller to show you a recent delivery being unloaded, since handling practices at the dock say a lot about how the cold chain is kept.
Key takeaways
- Ask for maintenance records and the age of every major unit.
- Review temperature logs and the plan for a power failure.
- Check layout, separation of products and whether equipment is owned or leased.
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Sources
This answer is checked against primary sources. Links were last confirmed on the dates shown.
- 01Business Development Bank of CanadaGovernmentHow to conduct due diligence when buying a business
- 02Business Development Bank of CanadaGovernmentEquipment valuation: How to do it
- 03Business Development Bank of CanadaGovernmentWhat are the steps to buying a business?
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