ManufAi

Why manufacturing M&A is less about spreadsheets and more about sniff tests.

In the world of manufacturing, no two bolts are the same—and neither are two companies. Buying a manufacturing business isn’t just about numbers; it’s about uncovering what’s beneath the surface: the people, processes, and profit levers that define the plant floor. Before wiring the deposit, every acquirer must ask one question: What exactly am I buying?

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Your M&A Strategy – a.k.a Don’t Buy Random Plants

First rule of manufacturing acquisitions: have a type.
You wouldn’t date someone just because they also own safety goggles—same logic applies here.

Ask yourself:

• Are you into metal fab (loud, reliable, slightly rusted charm)?
• Or engineered plastics (smooth, flexible, sometimes melts under pressure)?
• Or do you just like EBITDA? (We all do. It’s okay.)

Your strategy is your dating profile. “Likes: predictable margins, family-owned shops. Dislikes: undocumented inventory and cousins on payroll.”

The Dirty Work – Due Diligence

Forget “synergy.” You need sanity.

What you’re supposed to check:

• Financials, customer concentration, backlog, etc.

What you’ll actually find:

• Excel sheets that haven’t been balanced since the Bush administration.
• Machines running on prayers and duct tape.
• A “controller” whose main controller is his gut feeling.

Remember, the deeper you dig, the weirder it gets. If your gut says “something’s off,” it usually means someone hid CapEx under “Misc. Office Supplies.”

The Human Side

No data room can prepare you for Larry, the 40-year veteran who knows every machine’s mood swing.
If Larry quits post-acquisition, your EBITDA vanishes faster than free donuts at a safety meeting.

So, during due diligence:

• Don’t just tour the plant—watch who hides when you arrive.
• Ask operators how long they’ve “planned to retire.” (The answer tells you everything about the culture—and the upcoming turnover.)

Ask yourself this – Would you still buy it if you had to run it?

If you can’t see yourself fixing a coolant leak at 2 a.m., maybe skip this one.
The best deals are not the cleanest ones—they’re the ones where you can actually make a difference without losing your mind (or your wallet).

M&A in manufacturing isn’t just due diligence—it’s due patience.
You’re buying quirks, grease, and the occasional gold mine buried under poor Excel formatting.
So wear safety glasses, bring a flashlight, and remember: every deal looks good until you open the maintenance logs.