What switch things should you look for when buying an existing mfg business ?
Answers: 1. The product. Are they making a product that has a flea market? They can make the best iron pipe fittings contained by the world, but if every body is using plastic pipe fittings, that company is not long for this world.
2. Customer base. Is 90% of their business generate by a single customer? Stay clear! If that company would have financial difficulty, it could wreck the best companies.and if it be to lose that customer, lights out!
3. Debt to equity. Is the co heavy beside long term debt, and are accounts payable current? Then, the co have adequate lolly flow to pay its bills.
4. Legal issues. Not necessarily lawsuits, but are they disposing of squander in a questionable posture?? Is their facility surrounded by fields that are giving passageway to housing developments? true, the co was near first, but all it take in one human being buying a new house who is going to complain roughly heavy trucks going contained by and out of your property.
4. Are their workers represented by a Union. Non union work forces are more flexible.
5. ifs near room for future expansion?
There are others, but these , to me, are remarkably important.
Product Mfg process, age of equipment, length of current contracts, whether you can streamline short layoffs. Product service life and the amount of years the business have been operating.
The language in any lease agreements, effects of translation of ownership with lease, suppliers and bank. If you are in obligation of a longer list, post specifics and I shall provide as much information as I can.
company's liability, web profit margin, adjectives growth of company and at least final three year balance sheet, company asset Vs selling price demanded by company, and customer underpinning for their product and services