Thinking of Buying a Timber Yard in Australia? Here Are 3 Vital Questions to Ask
The Australian timber wholesaling industry generated $5.9 billion in revenue in 2025, employing more than 13,000 people across 1,585 enterprises. Profit margins average 5.5%, reflecting heavy competition and exposure to housing cycles.
Revenue declined by 2.5% annually over the past five years due to weaker dwelling commencements and rising interest rates, but growth is projected at 1.9% annually through 2030, reaching $6.5 billion. Demand will be supported by housing initiatives, population growth, and imports offsetting domestic supply shortages.
1. Is the Business Financially Resilient to Construction Cycles?
Why It Matters
Timber yards are highly exposed to housing and non-residential construction. Downturns reduce demand sharply, while booms drive higher sales. Cash flow resilience and diversification into renovation or industrial markets are crucial.
What to Check
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Profitability – Benchmark against the industry’s 5.5% average margin.
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Revenue mix – Review reliance on residential contractors versus commercial and industrial clients.
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Cash flow – Assess resilience to cyclical demand and seasonal fluctuations.
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Diversification – Confirm whether sales include renovations, DIY, or niche timber markets.
2. Does the Yard Have Reliable Supply and Import Capacity?
Why It Matters
Domestic plantation supply is limited, and bans on native logging in states like Victoria have increased reliance on imports. Businesses with strong sourcing arrangements, logistics capacity, and sustainable certifications are better positioned.
What to Check
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Supplier agreements – Review contracts with domestic mills and overseas suppliers.
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Import capability – Assess ability to manage logistics and price volatility.
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Sustainability – Confirm certifications like FSC or PEFC to meet customer expectations.
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Stock management – Evaluate systems for managing inventory and avoiding shortages.
3. Is the Business Competitive Against Wholesale Bypass and Substitutes?
Why It Matters
Builders and large retailers increasingly bypass wholesalers, sourcing directly from mills. Rising timber prices also encourage substitution with steel and composites. Timber yards must differentiate through service, specialty products, or value-adds.
What to Check
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Customer base – Determine reliance on builders, retailers, or smaller contractors.
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Value-added services – Assess offerings like pre-cutting, treatment, and delivery.
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Competitive landscape – Review presence of large chains or direct mill buyers nearby.
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Substitution risk – Consider exposure to alternative materials in local construction markets.
Ready to Invest in a Thriving Timber Yard Business?
With housing and infrastructure activity rebounding, timber yards remain vital to Australia’s supply chain.
Success will depend on supply resilience, competitive positioning, and alignment with sustainable and value-added services.
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For Sellers:
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