101 Questions You Must Ask Before Buying A Manufacturing Company

Buying A Manufacturing Company
⏱ Reading Time: 5 minutes

As an M&A professional selling exclusively within the manufacturing sectors, I’ve compiled a list of questions that every buyer should be asking before acquiring a manufacturing company.

101 Questions You Must Ask Before Buying A Manufacturing Company – PDF Download

On The Company History

  • How and why did the company start?
  • What were the major milestones?
  • How much has it grown from inception until now?
  • Who are the shareholders?
  • Are they all on board with the sale?

On Strategy & Market Potential

  • What are the key risks to this business?
  • What are the major impediments to corporate growth?
  • Are you aware of any new technology that will disrupt the industry?
  • What markets exist for your products and services that you’re not going after?
  • What is the one strategy, if implemented, would be a game changer for the company?
  • What are the best opportunities for growth?
  • When was the last time you increased prices?
  • Do you feel there is room in your current pricing for an increase, without losing customers?

On Your Competition

  • Who are your three main competitors?
  • How do you differentiate yourself from them?
  • When you lose an order to a competitor, what is the most common reason?
  • Thinking of your closest competitor in size, what do they do better than you?
  • Who are the most dominate industry players? What are their strengths and weaknesses?
  • How can you better position yourself against the competition?

On Marketing

  • Describe any company marketing and advertising campaigns.
  • What is your annual marketing budget?
  • What trade associations do you belong to?
  • What is your level of participation in your trade associations?
  • Do you market to existing customers to obtain more work?
  • When was your website last updated?
  • Do you utilize social media? What venues?
  • Do you promote your business through Google AdWords?
  • Who handles social media for your company?

On Sales

  • Describe the typical sales process from order to delivery and installation.
  • Describe who on staff is dealing with the customer at every stage of the sale cycle.
  • Describe how a quote is generated.
  • Is your quoting system computerized?
  • How far back in history do you have quoting records?
  • Is there a minimum profit margin added to quotes?
  • Do you have a standard shop rate? What is it?
  • Do you track actual time on a project in comparison to the time quoted?
  • Do you have an inside sales force?
  • Do you have outside sales reps?
  • How is the sales force compensated?
  • How critical is the owner to the sales process?
  • Who besides the owner are the customers accustomed to speaking with?

On Operations

  • What industry certifications does the company hold?
  • Are there other certifications, which if obtained, would help the growth of the company?
  • What are the main production bottlenecks right now? What is the cost to remedy?
  • Any known or suspected deferred maintenance?
  • As to equipment, if money were no object, I’d _____________________. Why?
  • How many shifts do you currently run and what hours?
  • What is the remaining % capacity of the existing shifts?
  • What is the remaining % capacity of the current building and staff?
  • What would have to change in order to double sales?
  • Describe safety programs and training.

Human Resources

  • Do you use a professional payroll service? Who interacts with the payroll company?
  • Any union contracts? Any suspected union organizing activity?
  • Are there any employees who would be ready to retire in the next few years?
  • Do you have a plant manager? Describe their level of expertise.
  • Describe any training programs in the last three years.
  • Describe all employee benefits?
  • Do you have a bonus or profit sharing programs?
  • Do employees receive annual raises?
  • Are there any employees, (family members) receiving an above market pay rate?


  • Do you own or rent?
  • If owned, do you prefer to lease or sell and under what terms?
  • If you rent, what are you paying and when does the current lease expire?
  • Are there renewal options?
  • Describe the relationship with the landlord.
  • Any known or deferred maintenance?
  • Describe the top 5 facility needs.

Information Technology (IT)

  • What software systems are currently used in the business?
  • What are the top 5 tech needs for the company?
  • What software if installed would be most helpful to the business?
  • Does your current staff welcome technology improvements and changes?


  • Describe your supplier sourcing procedures? Who performs this function?
  • Any sole suppliers of products or services?
  • Any quality or dependability issues with suppliers?
  • What are your supplier payment terms?


  • What accounting software does the company use?
  • When was the software last updated?
  • What are your payment terms with customers?
  • Do you offer a discount for early payment? How many, if any, take advantage of the discount?
  • What is your average A/R aging?
  • How much bad debt have you written off in the last 5 years?
  • How much capital is needed to run the company for a 30-day period?
  • What is your average A/P aging?
  • Are you on C.O.D. with any of your suppliers?
  • How much of your income comes from your top customer?
  • How much of your income comes from your top 10 customers?
  • How much of your income comes from the top industry served?
  • Have there been any lawsuits in the last 3 years?
  • Any workplace accidents in the last 3 years?
  • Any EEOC issues in the last 3 years?
  • Any OSHA issues in the last 3 years?
  • What warranties does your company provide on its products?
  • Any warranty claims in the last 3 years?
  • Any known or suspected legal, regulatory or government issues?


  • Why do you want to sell the company?
  • How long will you remain for training and transition?
  • Would you consider a consulting arrangement on an as needed basis after transition?
  • Will you be moving away from the area?
  • If you were 30 years younger and money was not an obstacle, what would you do to grow this business?
  • What do you most want to see in a buyer?
  • What are your major concerns about the sale of the company?

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