Manufacturing businesses are one of the most popular businesses for business migrants seeking a Business as part of their visa. This is because manufacturing satisfies all of the visa requirements for citizenship such as the number of Australian employees in the business, the threshold for turnover and also the hidden benefit of possibly being able to export some of the manufactured products back to the migrant's original homeland.
GMO businsss broking boss Graham O'Hehir reports that there have been many South African and Zimbabwean and Indian/Kenyan business migrants who have chosen to buy a manufacturing business over the past few years.
These migrants have been well suited to the manufacturing businesses and have in most cases prospered in their manufacturing business and have been able to improve the business and its proftabilty.
Sometimes a business migrant may bring better skill sets to the business and may have a more expansive outloook on the business than the person he has bought the manufacturing business from.
How much do manufacturing businesses sell for and what sort of price earnings multiples do manufacturing businesses sell for?
Well in the case of SME manufacturing the EBIT profit multiple can be as low as 1.5 times for a small modestly profitable manufacturing business where the owner is heavily involved in the production process...up to 5 to 6 times EBIT for a manufacturer where the business is making a multi million dollar profit and is big enough and has sufficient systemisation and processes to make it atttractive enough for a public company looking for a manufacturing business to acquire.
To discuss the valuation of the manufacturing business of interest to you contact graham O'hehir at Business valuer network on 1300634588.