Sell My Machine Shop

Selling a machine shop involves valuing heavy machinery, assessing the strength of your customer contracts, and understanding the expertise of your workforce.

Understanding Your Business Before Recommending a Broker

We start by analyzing your capabilities. Do you specialize in aerospace, medical, or automotive parts? Is your revenue tied to a few large clients or diversified? What is the age and condition of your CNC machines?

From there, we identify business brokers who specialize in manufacturing. Some are experts in selling smaller job shops to strategic buyers, while others work with private equity firms consolidating precision machining companies.

Key Value Drivers for Machine Shop Buyers

• Equipment & Technology – Modern, multi-axis CNC machines and robotic automation increase efficiency and buyer interest.

• Skilled Labor Force – Experienced machinists and programmers are hard to find. A stable team is a critical asset in any sale.

• Customer Diversification – A broad client base reduces risk. Shops reliant on 1-2 major customers may see lower valuation multiples.

• Certifications & Quality – ISO 9001, AS9100, and other certifications open doors to high-value contracts and justify premium pricing.

Buyers scrutinize your equipment, certifications, and customer diversity.

Deep Dive: Recasting Machine Shop Financials

To get the highest price, we work with brokers who "recast" your P&L to show the true Seller's Discretionary Earnings (SDE). In machining, this involves specific adjustments:

• Scrap Revenue: Ensure all scrap metal recycling income is accounted for as revenue, not just "found money," to boost the bottom line.
• Inventory Adjustment: Obsolete tooling or raw materials should be written down so the buyer sees accurate working capital needs.
• Repair vs. CapEx: Major machine rebuilds or controller upgrades are treated as one-time capital expenditures, adding back to operational cash flow.

Who is Buying Machine Shops?

The precision manufacturing sector is consolidating.

1. Strategic Buyers:
Larger machine shops often acquire smaller competitors to gain skilled labor, add new capabilities (e.g., EDM, grinding), or enter new verticals.

2. Private Equity:
PE firms are rolling up precision manufacturers, looking for shops with $2M+ EBITDA and strong management teams to serve as platform investments.

3. Individual Investors:
Engineers or former plant managers often use SBA financing to buy smaller job shops with SDE between $300k-$1M to run as owner-operators.

Preparing Your Business for Exit

To maximize your multiple, ensure your equipment maintenance logs are digitized and up to date. Buyers will audit your machinery. A well-documented maintenance history builds trust.

Our Advice: Review your OSHA logs and environmental compliance. Safety violations or unpermitted facility modifications can kill a deal. Address any outstanding regulatory liabilities before going to market.

Confidentiality is Critical

If customers hear you are selling, they may worry about quality or delivery times. If employees hear, they may fear for their jobs.

Our Approach: We utilize strict NDAs and "blind profiles." We market the capabilities, industries served, and equipment list without revealing your shop's name until a buyer has been qualified.