Selling a Manufacturing Business in Florida
A Guide for Florida Business Owners by Patrick Archer, MBA, CBI, CM&AP | Florida M&A Advisor | Calder Associates of Florida | 305.763.4112 (Mobile) 407.499.2855 (Office)
Selling a Manufacturing Business in Florida
Selling a Manufacturing Business in Florida is an important decision for owners of these essential business in the Sunshine State. Owners contemplating selling a Florida manufacturing business must obviously weigh the pros and cons of selling the business. Retirement is the primary motivating factor for most owners, while other owners may be planning to pursue new ventures in different industries.
Regardless of the motivations, sellers of manufacturing businesses in Florida will want to package and price the business to stand apart from competing listings and attract potential buyers. Many of these buyers are looking to take ownership of a successful manufacturing business in Florida and tap into the positive demographics, population growth, median household income and other trends benefitting Florida small business owners today.
Timing Considerations when Selling a Manufacturing Business in Florida
If you are the owner of a successful manufacturing business in Florida, now could be a great time to take advantage of these trends and the rising demand among U.S. and international buyers for great businesses for sale in Florida that are established, profitable, “essential” in the eyes of local governments, and resistant to external pressures like online retailers.
Selling a Manufacturing Business in Florida today can also help sellers command top dollar considering the supply and demand imbalance of available manufacturing businesses in Florida post-Covid-19. While the pandemic wiped out thousands of small Florida businesses in sectors like restaurants, gyms and beauty salons, Florida manufacturing businesses of all sizes emerged stronger and more attractive in the eyes of their owners, their customers, and potential buyers.
The Manufacturing Industry in Florida
The U.S. manufacturing sector is a $2.3 trillion industry accounting for over 12.8 million jobs with workers earning an average annual salary over $84,000.
“The manufacturing sector is a $2.3 trillion industry in the U.S.”
Florida is one of the Top 10 states in terms of manufacturing output, and manufacturing activities contribute more than $40 billion to the Florida economy, according the Florida Chamber. Florida has over 360,000 workers engaged in manufacturing jobs earning an average salary of $54,000. 95% of Florida manufacturers have fewer than 25 employees. For every 10 jobs created in Florida manufacturing, the Chamber estimates 12 additional jobs are created in Florida retail, transportation and warehousing sectors.
“Manufacturing contributes more than $40 billion to the Florida economy.”
Florida’s estimated 19,000 manufacturing companies producing a wide range of business and consumer goods including aircraft parts, batteries, beverages, boats, clothing and swimwear, defense parts, electronics, lumber and plywood, medical equipment, metal parts, pallets and packaging, pharmaceuticals and supplements, swimming pool equipment and much more.
Many of Florida’s 19,000 manufacturing companies are located in Central and South Florida with easy access to major highways, international airports and major seaports for distribution of intermediate and finished goods throughout the United States and overseas export to international markets.
Skills needed to Operate a Manufacturing Business in Florida
As in all states, the manufacturing sector in Florida is highly competitive, and owners of the most successful manufacturing businesses have many years of experience and hundreds of satisfied customers who depend on these companies for the on-time delivery of intermediate products and finished goods.
Current owners thinking of selling a manufacturing business in Florida will want to know that potential buyers of the business have the operational knowledge, managerial skills and financial resources necessary to manage and grow the business for the next generation.
Most buyers of manufacturing businesses in Florida will pursue SBA financing, and most SBA lenders will want to see that the buyer has some knowledge or experience in the manufacturing business.
“Florida manufacturing companies produce both intermediate and finished goods.”
Ideally, a future owner of a manufacturing business in Florida would already have several years experience as an employee or owner/operator of a manufacturing business in their home state or home country.
Many owners of established manufacturing businesses in Florida will only consider selling their business to a buyer who has a proven track record of experience in the manufacturing industry or a related industry, either as an employee or an owner/operator of the business. Likewise, most SBA lenders will view potential buyers through the same lens of relevant manufacturing experience and qualifications.
Best Cities For Selling a Manufacturing Business in Florida
For potential buyers open to living anywhere in the Sunshine State, sellers of manufacturing businesses in Florida will be competing with other owners of similar business statewide. These buyers will be weighing several factors including a variety of demographic and quality of life metrics that will impact both their decision making process.
Florida’s population of 23 million is spread throughout the state’s 67 counties, but the largest clusters of high net worth households paying top dollar for finished goods are concentrated in the southern half of the state along a ring of 14 coastal counties on the Atlantic Ocean and the Gulf of Mexico. This “golden horseshoe” of Florida demographics encompasses the 25 Wealthiest Zip Codes in Florida based on Average Gross Income.
“This 14-county coastal region is the Golden Horseshoe of Florida demographics.”
This 14-county coastal region extends from Tampa/St.Petersburg on the Gulf side, south to Naples/FortMyers and down to the Florida Keys, east to Miami/Fort Lauderdale and extends north through the coastal communities of Pompano Beach, Boca Raton, Palm Beach, Jupiter, Hobe Sound, Stuart, Port Saint Lucie, Vero Beach and Melbourne. Some of Florida’s largest and most profitable manufacturing companies are located in this 14-county coastal region.
And, of course, no conversation about desirable areas to live and own a business in Florida would be complete without mentioning the Orlando metropolitan area. “The City Beautiful” is one of the fastest-growing metros in the country, and the influx of new residents creates ample opportunities for new and existing business owners.
“With over 2 million residents, Orlando’s economy is booming and increasingly diverse”
Long known as a tourism mecca and home to theme park giants like Disney and Universal, Orlando’s economy is increasingly diverse. And world class infrastructure improvements like the new $3 billion Terminal C at Orlando International Airport facilitate domestic and international arrivals and intrastate travel with the addition of Brightline, a high-speed rail link between Orlando and South Florida metros like Miami, Fort Lauderdale and West Palm Beach.
Median Asking Price of Manufacturing Businesses for Sale in Florida
Once you have decided on selling a manufacturing business in Florida, it’s a good idea to work with a licensed and experienced Florida M&A advisor to get a better understanding of the current value of your business and a most probable selling price to qualified buyers looking to buy your Florida manufacturing business with some combination of cash and financing, either through an SBA loan, seller financing, a bank loan, a leveraged buyout, assumption of debt, or some other mutual buyer/seller agreement.
According to the Florida database of businesses for sale, the median asking price for manufacturing businesses for sale in Florida is currently $2,000,000 for existing businesses generating over $500,000 in annual revenue and over $250,000 in annual cash flow.
“The median asking price of Florida manufacturing businesses for sale is $2,000,000”
The range of asking prices for Florida manufacturing businesses for sale extends from $495,000 on the low end to $5,900,000 on the high end for Florida manufacturing businesses generating over $500,000 in annual revenue and over $250,000 in annual cash flow.
Median Annual Revenue of Manufacturing Businesses for Sale in Florida
With the right team of talented employees, good equipment, quality controls and an established customer base, manufacturing companies in Florida can be great revenue generators for both current and future owners. According to the statewide database of businesses for sale in Florida, the median annual revenue for manufacturing business for sale in Florida is $1,813,000.
“The median annual revenue of Florida manufacturing businesses for sale is $1,813,000”
The range of annual revenue for Florida manufacturing companies extends from $692,000 on the low end to $8,500,000 on the high end for Florida manufacturing businesses generating over $500,000 in annual revenue and over $250,000 in annual cash flow.
Median Cash Flow of Manufacturing Businesses For Sale in Florida
Established and well managed manufacturing companies in Florida can produce significant cash flow benefitting both the current owner and future owners of these businesses.
“The median annual cash flow of a Florida manufacturing businesses for sale is $457,000”
According to the official database of businesses for sale in Florida, the median annual owner benefit or cash flow for manufacturing businesses for sale in Florida is $457,000. As such, manufacturing businesses for sale in Florida enjoy a median cash flow of 25% of annual revenues. ($457,000 / $1,813,000 = 25%)
The range of annual cash flow for manufacturing companies for sale in Florida extends from $250,000 on the low end to $1,600,000 on the high end for Florida manufacturing businesses generating over $500,000 in annual revenue and $250,000 in annual cash flow.
“The median payback period for a Florida manufacturing business is 4.37 years.”
Based on these same numbers, the ratio of median cash flow to asking price for existing Florida manufacturing businesses for sale is 22% ($457,000 / $2,000,000) which translates into a median payback period of 4.37 years.
Additional Resources for Selling a Manufacturing Business in Florida
Selling a Manufacturing Business in Florida is a major life decision that requires serious due diligence and sound guidance from an experienced and trusted M&A advisor.
If you would like to schedule an initial consultation regarding your Florida manufacturing business, current valuation and next steps, please call us at 305.763.4112, schedule a free consultation, or use the contact form below.