Manufacturers with real products, equipment, and distribution attract both strategic and private equity buyers. A real example from M&A Business Advisors is Bay Standard Manufacturing of Brentwood, California, a maker of anchor bolts, threaded rods, and construction fasteners, where M&A Business Advisors represented both sides and sold to Salt Creek Capital. Here is what selling a manufacturer involves.
The deal
Private equity buyers look for manufacturers with defensible products, real equipment, and distribution they can scale.
How manufacturers are valued
Like most businesses under $5M, these sell on a multiple of earnings, either Seller's Discretionary Earnings (SDE) for smaller owner-operated shops or EBITDA for larger, management-run companies. The exact multiple varies by the specifics below, so treat any range as a starting point, not a quote.
For manufacturers, value tracks product defensibility, margin, equipment, inventory, customer and distribution relationships, and how much the business depends on the owner. Proprietary or spec-driven products value higher than pure commodity work.
Want a real number on your business?
I do confidential, no-pressure valuations for owners of trades and service businesses. No obligation to sell.
Book a 20-minute callWhat buyers look for
- Defensible or spec-driven products rather than pure commodity output.
- Healthy, documented margins and clean inventory accounting.
- Diversified customers and distribution.
- A management layer so the business runs without the owner.
Getting ready to sell
Clean up your margin and inventory reporting, diversify customers, and build a management layer. Then get a real valuation. I help owners get there.
Want a real number on your business?
I do confidential, no-pressure valuations for owners of trades and service businesses. No obligation to sell.
Book a 20-minute call