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 4,600 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.

Highly-Seasonal Demand

Demand for farm and garden machinery is highly seasonal and affected by weather and climate.

Variability In Commodity Prices

Fluctuations in commodity prices -- driven by global market conditions -- affect farm income and farmers' ability to purchase new equipment.

Industry size & Structure

The average farm and garden machinery wholesaler operates out of a single location, employs about 23 workers, and generates $19.6 million in annual revenue.

    • The farm and garden machinery wholesaling industry consists of about 4,600 firms that employ about 108,600 workers and generate $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
                                Source: Vertical IQ and Inforum

                                Recent Developments

                                Mar 4, 2024 - Prices Fell Amid Higher Payroll Cost in 2023
                                • Employment by farm and garden machinery wholesalers grew 2.8% in December compared to a year ago after climbing 5.7% in the previous annual comparison, according to data from the US Bureau of Labor Statistics. Average industry wages rose 3.1% over the same period to $29.24 per hour in December, per the BLS. Producer prices for machinery and supply wholesalers moved in the opposite direction, dipping by about 1% in December year over year, as labor costs rose, government data shows.
                                • A new California law that bans homeowners and landscaping professionals from purchasing gas-powered lawn care equipment (manufactured after Dec. 31, 2023) from retailers in the state took effect in January, CarbonCredits.com reports. California is the world’s 4th-biggest economy and the first US state to phase out fossil fuel-powered landscaping tools including lawnmowers, leaf blowers, and chainsaws. The new law aims to drastically reduce harmful air quality across the state, by pushing people to use electric or battery-powered equipment instead. The carbon emissions from gas-powered lawn tools, especially lawnmowers and leaf blowers, significantly contribute to air pollution while generating excessive noise. In 2020, lawn tools emitted more than 30 million tons of CO2, according to the EPA. The ban on gasoline-powered lawn equipment in California could signify a transformative shift in the landscape of suburban America and will test Americans’ willingness to embrace cleaner technologies in their daily lives.
                                • Just 25% of US farms currently use connected equipment or devices to access data, putting them at a big disadvantage in today’s increasingly connected agricultural sector, according to a recent white paper by the Association of Equipment Manufacturers (AEM). “Without ubiquitous connectivity, the agriculture industry cannot fully embrace the new tools and technologies that will enable it to meet the productivity and sustainability demands of the future,” writes AEM. Underscoring the importance of connectivity, farm machinery giant Deere is investing billions of dollars to build out computer-assisted services for farmers and recently signed a deal with SpaceX’s Starlink business to connect tractors, seed planters, crop sprayers, and other equipment in areas that lack adequate internet service. The lack of Wi-Fi service is even greater outside the US with more than 70% of the acres farmed in Brazil lacking adequate connectivity, according to The Wall Street Journal.
                                • Prices for used farm machinery are expected to soften in 2024, AgFax reports. Prices of mid-to-high horsepower tractors, which have been rising steeply since 2021, were projected to fall as supply caught up with demand in the second half of 2023. Also, the supply of used harvesters, which began to rise late in 2022 and continued into 2023, should cause prices to drop in 2024, AgFax reports. However, used equipment values aren’t expected to decline as dramatically as in previous down cycles when they toppled 20%-25% in 2014 and another 15%-20% in 2015. That’s because there are far fewer farm equipment dealers around today and those that remain are larger and more proactive in paring down their used inventory to match market demand.
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