Questions a machine shop buyer will ask
Who your top five customers are and what share of sales each one brings
Which quality certifications you hold and when they were last audited
A machine list with makes, ages, hours and condition
Your machinists and programmers, their experience and their pay
Whether you own the building or lease it, and on what terms
Customer Concentration Comes First
Many shops grew around one or two anchor customers: an aerospace supplier, an energy company or an equipment maker. That relationship built the business, but it can scare buyers.
If your top one to three customers bring in more than about 15 to 20 percent of sales, expect a discount or a deal structure like an earnout. Adding customers takes years, so start before you plan to sell.
Certifications and Quality Records
Aerospace and defense work often requires quality certifications and careful records. A shop with current certification and clean audits can sell for more, because a buyer can't easily build that from scratch.
Keep your quality manual, audit reports and inspection records ready. Buyers in this field will check them closely.
The Machines
Machines are a big part of the asset value, and buyers will look at them one by one. Newer multi axis machines with good maintenance records help. Old manual machines matter less.
A current equipment appraisal can save time. In Oklahoma, the equipment in a business sale is treated as taxable, so read our guide to sales tax on equipment in a business sale.
Machinists and Programmers
Skilled machinists are hard to hire. A shop with a stable team, good training and a programmer who isn't the owner is far easier to sell.
If you still do most of the quoting and programming yourself, start handing it off now. Buyers pay more for a shop that runs without its founder at the machine.
The Building
Many shop owners own their building through a separate company. You can sell it with the business, keep it and lease it to the buyer, or sell it separately. Each choice changes your tax and income picture.
Make sure the rent you charge the business is at market rate. Buyers figure rent at market, and a below market lease lowers their view of earnings. The valuation page explains why.
Ready for a number? Send the valuation form or call (405) 555-0158.