The definition of a Blind Side (noun) is the side on which one that is blind in one eye cannot see or is looking away. The definition of Blindside (verb) is to hit unexpectedly from or as if from the blind side or to surprise unexpectedly. As we start another football season, we’ll likely hear this term a lot. But it’s applicable to business as much as sports. As someone serving the manufacturing sectors for 30 years, here’s my question for you: Does Your Manufacturing Business Have a Blind Side?
I was reminded of the importance of this question a week or so ago when I was contacted by a lower-middle market niche manufacturing company. The founder was on the approach to retirement but not ready for another 3-5 years. He was still in growth mode but wanted to remain on my radar. As an M&A professional exclusively serving manufacturers, his company was right in my firm’s sweet spot with about $45 million in revenue.
In my response to the founder, I explained that we love it when companies reach out several years in advance. I think people don’t start conversations to learn about the sale process early because they’re afraid of a slick sales pitch. But, as I explained to this manufacturing business founder, starting the conversation early provides an opportunity to identify and correct a blind side that might exist in the business.
You might be thinking, “I don’t have a blind side,” or “An Achilles Heel, not in my business!” But here’s the thing: it’s called a “blind side” for a reason. You can’t see what you can’t see. While some manufacturing business owners are serial entrepreneurs with experience in selling prior businesses, the vast majority have never sold a multi-million-dollar enterprise. In fact, most founder-led manufacturing companies weren’t large when they started; they were bootstrapped.
So, what do you do when you’ve never done something before? Wisdom dictates that you seek advice from an industry expert. Of course, you can always DYI it, but do you really want to do that for what might be the largest transaction of your life, with your retirement dependent on the outcome?
Remember part of the blind side definition, “to surprise unexpectedly.” That’s the last thing you want when your retirement dollars are in play. Some blind side issues can be corrected quickly, others take a long time. The irrefutable point is that knowledge is power. You can’t correct that which you don’t perceive to be a problem. Do not wait until you’re ready to go to market to learn how quality manufacturing acquirers will view your business.
The same is true for companies that hope to partner with a larger organization to facilitate growth. This conversation isn’t just for those who wish to sell but also for those who wish to attract a quality investment partner.
Can this really make a difference? You bet it can. We’ve seen blind side corrections add 10 to 50% to a company’s value. Do not wait until you’re ready to sell to learn if your manufacturing business has a blind side. Here’s the best part: starting the conversation doesn’t have to cost a dime. Seriously.
Does Your Manufacturing Business Have a Blind Side? Reach out to learn more.