Even though the United States has lost more than 60 million acres of farmland between 1990 and 2008, tractors and other farm equipment are still needed to farm the land that remains. In fact farms must grow more food and raise more animals now than they did previously to keep up with the demands of the growing U.S. population. You can profit on this need.
Write a business plan. Outline what services and products you’ll provide through your tractor business, and determine if you’ll become a dealership and repair shop for only one specific brand. Conduct a SWOT (strengths, weaknesses, opportunities, threats) analysis based on the location, competition, resources and plans for the tractor business. Make sure you can sell and repair enough tractors in your area or region to pay expenses and still earn a profit. Determine how much it will cost to start your business, and ensure you can afford it. For help in writing your business plan, consult the website of the U.S. Small Business Administration, which offers example business plans as well as a guide to help you draft your own for your tractor business.
Seek out funding. Use the finance information from your business plan to apply for business and commercial loans from local banks and credit unions. Contact representatives from tractor manufacturers such as John Deere and Caterpillar to learn if any sponsorship funding is available to help you start your business. Form a partnership if you find a person with enough capital or monetary resources to fund the start-up.
Register your business. Obtain an employer identification number (EIN) from the Internal Revenue Service (IRS) by calling 800-829-4933 or filling out the online form from the IRS's website. Complete the forms and paperwork at the local and state level to register your business with the department of revenue to collect sales tax on the products you sell. Apply for a local business license through your city or county government. Purchase liability and property insurance to protect your tractor business in the event a natural disaster occurs or someone is injured while at your place of business.
Find a facility. Search for a commercial space capable of housing your tractor business. Know that you need office space as well as an oversized garage space where you can bring in a broken-down tractor and repair it. Look for a space that also includes a large amount of outdoor land and area. This allows you to park tractors you have for sale on your lot for farmers to look at and consider buying.
Purchase products and supplies. Contact tractor manufacturers to purchase directly from them. Start with a small amount of tractors in your business until sales pick up and you know what brands and type of tractors are most in demand in your region. Outfit your repair shop with tools to repair tractors, and ensure you have the office supplies you need to manage your finances and records.
Find employees. Hire staff to sell farmers on purchasing new tractors while also employing diesel mechanics to service and make repairs for farmers who've purchased new equipment from your business. Get a receptionist or administrative assistant to answer phones and handle the paperwork associated with operating a tractor business.
Market your business. Place ads in publications, journals and newspapers that cater specifically to farmers. Network with farmers by attending local co-op meetings and becoming involved in farming associations. Develop a partnership with a local bank or credit union willing to finance farmers. This helps you sell new tractors to farmers who generally don’t have enough money to make the purchase themselves and who may not qualify for traditional loans.
- tractor image by PeteG from Fotolia.com