One of my main business-buying "secrets" is to simply by manufacturing businesses...over any and every other kind. There are many reasons for this, but the main two being the risk is extremely low and the success rate is extremely high. With that said, a lot of times someone will ask me if, with everything being outsourced to China, like all the mold and tool die business, has that changed my opinion on manufacturing? Is that a concern? And my answer is no. Reason why is because youre going to run into a lot of larger companies that are already outsourcing. And in the old days, we were in outsourcing before there was a word called "outsourcing" because we were in Mexico for many, many years already. What we did, even though our plant was in the U.S., is we always outsourced. I always went to Mexico. And what I would do is Id have 100 employees at $10 million a year in sales. If we then had a big burst in sales, instead of me adding people or trying to add more manufacturing facility, I would go offshore with it. And then what would happen as soon as the business would go back to where it was before, I would pull the jobs back in from Mexico. It comes up all the time when you look at manufacturing businesses. And what youre going to find is most of the companies that are large enough (and it makes sense) have already gone offshore either to the Far East or to Mexico. |
