Sell a Precision Machine Shop

Orders and margins tell different stories

A busy shop can still have weak earnings when material, overtime or rework absorbs the margin. Present several years of results and current monthly accounts, with explanations for unusual changes.

Break out revenue by customer. A heavy reliance on one account can change both price and payment terms, even when that customer has bought from you for years.

Be precise about equipment spending

Depreciation is an accounting expense, but machines still need maintenance and replacement. A buyer may question an adjustment that treats all equipment costs as if they disappear after closing.

List machine condition, ownership, liens and any leases. Remove equipment already sold from the balance sheet so the buyer is not reconciling an asset list that no longer matches the floor.

Identify the knowledge that leaves with you

If you alone estimate jobs, program difficult parts or handle key customers, the buyer will price the cost of replacing that work. Build a clear training plan rather than promising to be available indefinitely.

• Document estimating and scheduling responsibilities.
• Identify employees whose skills support repeat orders.
• Separate production equipment from personal or surplus assets.

Review the building before taking an offer

A short or uncertain lease can weaken an otherwise sound sale. If you own the property, model a market rent for the operating business and decide whether to sell the property or retain it.

Do not combine property value and operating earnings into one unsupported figure. They use different valuation methods and may attract different buyers.

Keep the sale moving

• Review the earnings adjustments
• Check customer concentration
• Request your confidential seller valuation

Use the valuation form to outline your sale, or call (408) 555-0179.