The Opportunity
An established agricultural retailer and custom application provider operating from western Oklahoma into a trade area that reaches roughly 100 miles across Oklahoma, Texas and Kansas. The company sells crop protection chemical, fertilizer and seed at retail, then applies those inputs on the same acres using two owned ground rigs, with aerial application available for acres where ground equipment is not appropriate.
Because the business controls the agronomic recommendation, the product and the equipment that puts it on the ground, it earns twice on the same acre: margin on the input sale and a fee on the application. That combination is the reason growers consolidate a season with one provider rather than buying product from one source and hiring a pass from another.
The company holds all three Oklahoma licenses required to operate as configured. Those licenses are the legal prerequisite to selling and handling fertilizer and chemical and to applying either, and they are a real constraint on how quickly a competitor can enter the trade area.
Revenue is anchored in inputs that growers buy every crop year rather than in discrete projects. Chemical and fertilizer together represent roughly 80% of the business, with application and seed accounting for the balance and pulling product sales with it.
Licensing and Owned Capacity
Two aspects of the business are difficult to reproduce.
The first is regulatory. A buyer must hold or obtain the Oklahoma Certified Applicator, Fertilizer and Chemical licenses to run the business as it operates today. This narrows the competitive set locally and also narrows the buyer pool, which is why the owner’s availability matters as much as it does.
The second is physical. The company owns its application fleet rather than subcontracting it: two New Holland sprayers at 1,200 and 1,800 hours, a 1999 Peterbilt 375 tender truck, a sprayer trailer, three 1,000 gallon trailer tanks, three 6,000 gallon cone bottom tanks, a forklift and associated pumps, motors and hoses. Owning the fleet means the company controls its own schedule during the narrow windows when growers need the pass made, and it keeps the service margin in house.
Supply comes through dealer relationships with national and regional seed, chemical and fertilizer suppliers maintained over fifteen years of continuous operation, giving the business a broad product line without the capital of a blending or manufacturing operation.
Financial Summary
| $ in thousands | 2022 | 2023 | 2024 |
|---|---|---|---|
| Total Revenue | $4,058 | $3,251 | $4,346 |
| Gross Profit | $834 | $823 | $949 |
| Gross Margin | 20.6% | 25.3% | 21.8% |
| Seller’s Discretionary Earnings | $519 | $667 | $815 |
| Adjusted EBITDA | $439 | $585 | $730 |
| Adjusted EBITDA Margin | 10.8% | 18.0% | 16.8% |
Cash basis, normalized for owner compensation, interest, depreciation and documented owner and nonrecurring items, and stated net of a market rate replacement salary.
The 2023 revenue decline and 2024 recovery reflect the commodity price, weather and planted acreage cycle that governs this trade area. Earnings should be evaluated on a multiyear normalized basis rather than on any single season. Notably, gross profit held nearly flat through the softer year while normalized earnings continued to improve, which is a function of the low fixed cost structure: two salaried employees, a $2,000 monthly facility and outsourced accounting.
A full normalization worksheet, debt schedule, capital expenditure history, receivables aging and period end inventory valuation are being assembled and will be provided to qualified buyers in diligence, along with customer count and revenue concentration.
Growth Levers
The business has never advertised. Ownership describes its media strategy as “nothing really.” Fifteen years of customer acquisition has come entirely from reputation and referral, with no measurable marketing spend in any channel. Every conventional demand generation tool available to an agricultural retailer is still untried.
- Build a demand engine. A functioning website that captures inquiries, local radio and farm print timed to the pre plant and fall application windows, grower field days with supplier partners, and a formal referral program. Spend can be capped and measured directly against booked acres.
- Raise rig utilization. Application and seed are only about 20% of the business while chemical and fertilizer are 80%, which points to a meaningful volume of acres where the company supplies the product but someone else makes the pass. Converting those accounts to a bundled per acre program uses equipment that is already owned, so incremental acres carry high contribution margin. Overflow contract application for neighboring retailers and cooperatives without licensed applicators fills the shoulder days.
- Grow seed and consulting attach rate. Seed sits inside the smallest revenue line despite dealer relationships with four seed suppliers, and the crop, land and wildlife consulting the company already performs is offered as a courtesy rather than merchandised as a priced service. Attaching both to existing chemical and fertilizer accounts requires no new capital.
- Work the outer radius. The company already services a roughly 100 mile radius reaching into Texas and Kansas but has never made a deliberate sales push into the outer band where it is known only by reputation. One dedicated salesperson could cover that ground.
Transaction Details
- Asking Price: Unpriced. Indications of interest invited.
- Reason for Sale: Retirement from ownership and management
- Owner Transition: Up to 24 months in an operating role, flexible to the buyer’s plan
- Real Estate: Leased at $2,000 per month with no written term. The landlord is open to selling the property to a buyer, and this should be addressed in the letter of intent
- Licensing: Confirmation of license transferability is a diligence item and materially affects the buyer pool
- Diligence: Full confidential information memorandum, financial detail and management access available under executed NDA