Farm and Garden Machinery Wholesalers
Industry Profile Report
Dive Deep into the industry with a 25+ page industry report (pdf format) including the following chapters
Industry Overview Current Conditions, Industry Structure, How Firms Operate, Industry Trends, Credit Underwriting & Risks, and Industry Forecast.
Call Preparation Call Prep Questions, Industry Terms, and Weblinks.
Financial Insights Working Capital, Capital Financing, Business Valuation, and Financial Benchmarks.
Industry Profile Excerpts
Industry Overview
The 4,500 farm and garden machinery wholesalers in the US distribute machinery, equipment, and related parts used in the agricultural, farm, lawn, and garden industries. Major product categories include farm tractors; lawn and garden machinery; harvesting machinery; new land preparation, planting, and cultivating machinery; and irrigation machinery. Firms may sell new and used equipment or rent equipment. They also offer warranty, maintenance, and repair services.
Variability In Commodity Prices
Fluctuations in commodity prices -- driven by global market conditions -- affect farm income and farmers' ability to purchase new equipment.
Highly-Seasonal Demand
Demand for farm and garden machinery is highly seasonal and affected by weather and climate.
Industry size & Structure
The average farm and garden machinery wholesaler operates from a single location, employs about 26 workers, and generates $20 million in annual revenue.
- The farm and garden machinery wholesaling industry comprises about 4,500 firms, employs about 116,000 workers, and generates $90 billion annually.
- The industry is concentrated at the top and fragmented at the bottom; the top 50 companies account for 50% of industry revenue.
- Wholesalers include independent dealers for major machinery manufacturers, such as John Deere and Case New Holland Industrial. A dealership group operates multiple retail locations.
- The largest farm dealership groups include Titan Machinery (Case), RDO John Deere, Rocky Mountain Equipment (Case), and James River Equipment (John Deere).
- Farm tractors of 40-99 horsepower account for 44% of all tractors in operation according to the USDA. Tractors of 100 or more horsepower represent 31%, followed by tractors of less than 40 horsepower at 25%. Farms are also using over 662,000 hay balers, 323,000 grain and bean combines, 64,000 forage harvesters, and 18,000 cotton pickers and strippers.
Industry Forecast
Farm and Garden Machinery Wholesalers Industry Growth
Recent Developments
Dec 6, 2024 - Rising Inventories
- Inventories for machinery and equipment wholesalers rose 11.9% in July compared to a year ago but were down slightly (0.9%) from the previous month, according to Census Bureau data. Sales for machinery and equipment wholesalers rose 5.2% year over year in July and were up 3.8% versus June. Industry inventories have been rising steeply since early 2022, to satisfy rising demand. However, as demand for farm equipment cooled, inventory began piling up on dealers’ lots. Sales for the US farm and garden machinery wholesalers industry are forecast to grow at a 4.28% compounded annual rate from 2024 to 2028, comparable to the growth of the overall economy, according to the Interindustry Economic Research Fund.
- In 2025, farm equipment dealers are expecting revenue from parts and service to rise while equipment sales fall, according to Associated Equipment Dealers’ On the Record podcast. The outlook for 2025 revenues skews negative with the lowest percentage of dealers forecasting new equipment revenue growth seen in over a decade. More than two-thirds of dealers are forecasting new equipment revenue to be down at least 2% in 2025, compared to 28.8% who forecast a decline for 2024, and more than double the percentage of dealers who forecasted a decline for 2023 new equipment revenue. The last time at least half of dealers were forecasting new equipment revenue to fall was in 2015. Nearly a quarter of dealers are forecasting new equipment revenue to be flat next year, while about 10% expect new equipment revenue to rise 2-7% and 2.5% expect revenue to increase of 8% or more.
- There is no “one-size-fits-all” organizational structure for farm equipment dealerships, especially as they grow in size, Farm Equipment reports. Keith Kerbs, COO at 21st Century Equipment, which operates 26 locations across three states, identified three common organizational structures and noted that choosing the right one largely depends on the size, growth, and diversity of the dealership. Factors to consider include product and brand mix from store to store, types of customers served, size of stores, and the strengths and weaknesses of local leadership. Location, the most common organizational structure, is where all employees, including parts and service managers, report either directly or indirectly to a store manager. The Matrix structure features another leader outside of the location that certain employees report to, such as a company-wide or regional sales manager. Instead of having store managers, the Functional structure installs managers in different functional areas of the business.
- Farm equipment is piling up on dealers' lots as boom times fade for machinery manufacturers, Reuters reports. Declining farm income, stubbornly high interest rates, and low corn and soybean prices have led to a surplus of tractors and combines. As a result, farm equipment dealers are discounting machines, suspending new orders, and auctioning off equipment at reduced prices, according to Reuters. The current oversupply of farm machinery is a big change from two years ago when industry giants Deere and CNH struggled to meet surging demand amid record-high farm income and pandemic assistance payments that gave farmers extra money to upgrade their fleets. The inventory glut has prompted dealers to halt new orders from companies, including CNH, AGCO, and Polaris, to balance supply and demand. Moreover, used agriculture machinery inventory, the bulk of machinery sold in the US, is steadily increasing, dampening demand for new machinery.
Get A Demo
Vertical IQ’s Industry Intelligence Platform
See for yourself why over 60,000 users trust Vertical IQ for their industry research and call preparation needs. Our easy-to-digest industry insights save call preparation time and help differentiate you from the competition.
Build valuable, lasting relationships by having smarter conversations -
check out Vertical IQ today.