Please read our complete guide for selling a manufacturing company to make your transaction a smooth one and maximize your investment return.
Now might be the perfect time to sell your manufacturing business. The manufacturing industry is booming right now!
Ride down any street in Tulsa, and chances are you’ll pass a manufacturing company. There are no less than 86 manufacturing companies in Tulsa, Oklahoma.
Whether you want to build some fishing baits at Gene Larew Lures off E 11th Street, or find some shipboard electrical components at U S Pioneer LLC off S 70th East Ave, there are plenty of manufacturing businesses for sale.
If you’re a manufacturing company owner, perhaps you’re considering selling your out to take an early retirement, or maybe you want to capitalize on the manufacturing boom.
Either way, you would do well to read over our complete guide for selling your manufacturing company to maximize your profits and avoid any potential mishaps in your transaction.
5 Tips for Selling Your manufacturing company
It’s inevitable. Eventually, every manufacturing company owner will exit stage right. They’ll take off their tool built and hand over the keys to their processing equipment.
The sooner that you begin preparing your exit, the smoother the process will be.
Before you list your manufacturing company for sale, consider these five items:
Formulate an Exit Strategy
The sooner you start developing a robust exit strategy, the better. A robust exit strategy will help keep you on task and outline fine details throughout the sale process. When creating an exit strategy, ask yourself the following questions:
- When are you planning on leaving the business?
- Who are the manufacturing company’s prospective buyers?
- Will the new owners keep the current staff, or will they hire new employees?
- Does your building’s exterior or interior require any remodeling?
- How will you transfer ownership to the new owners?
Now that you’ve got your exit strategy in place let’s work on those documents.
Organize Your Business’s Books
Here’s the fun part, preparing your business paperwork for your business’s buyers – those new manufacturing company owners.
Whether they are converting raw materials or are further down the supply chain, they’ll expect to see complete and organized books when they do their due diligence.
All of them.
Locate and organize everything from tax statements to lease agreements to records of your manufacturing company’s cash flow.
You can expect prospective buyers to want to review and evaluate them to avoid any red flags that would invalidate their investment.
Consider hiring a business brokerage to help you compile these documents to avoid any errors or document omissions.
Get the Business Ready for Sale
Although you’re selling your manufacturing business, make some last-minute adjustments to ensure it’s ready for the new owners to hit the ground running.
Look for both interior and exterior building issues. Anything from a broken conveyor to cosmetic damage on your building’s exterior could complicate the buying and selling process.
Evaluate your current business procedures and document your processes. Identify and correct any missed opportunities for improvement and growth, such as:
- Manufacturing new products.
- Offering environmentally-friendly packaging
- Adding delivery services
- Expanding into other manufacturing niches.
- Improving your online footprint with social media
- Rewarding loyal customers
- Improving your customer service
While some of these may take longer to implement, they will go a long way in making your manufacturing company more alluring to a potential buyer.
You can even poll your customers about which options or features they’d like to see and add them.
Now let’s talk money.
Determine how much your manufacturing business is worth.
As a small business owner, it’s natural to be somewhat biased when determining your asking price. Of course, any established business owner will have an emotional attachment to their business.
Consider enlisting the help of a business broker to help you get an accurate business valuation.
By hiring a broker, you can take emotion out of the equation and determine your business’s accurate value. A professional can help you calculate your manufacturing company’s actual worth and help you select a fair sale price.
Speaking of emotion, don’t get all nostalgic, but now it’s time to:
List Your Manufacturing Business for Sale
Now that you’re ready to list your manufacturing company, you’ll need to determine the best way to spread the word about your business for sale.
While you can list your business by yourself, working with a professional broker can help cut the stress and make the whole process easier.
Selling any business is time-consuming. By allowing a professional to do all of the heavy lifting, you can remain focused on running your business and ensuring that your company operates smoothly.
Now that you’ve read our five tips for selling a manufacturing business, do you feel overwhelmed?
Don’t know where to begin?
Consider reaching out to the business brokers at Winning Hand. We’ve got the experience and know-how to help you sell your manufacturing business.
Contact us for more information.