We recently highlighted the positive impression that middle-market businesses have been making on the U.S. economy. Between 2011 and 2017, this small but significant section of firms has been a driving force in helping the nation recover from the Great Recession.
Although they only represent 3 percent of all U.S. companies, they account for over a quarter of all business revenue. With a growth rate of nearly 7 percent in the past 12 months, which will return to a healthy 5 percent in the next year, the middle-market’s impact is set to continue for the foreseeable future.
Although this swell of positivity within the middle-market is present in the vast majority of industries, it has been especially apparent in manufacturing. This is something we’ve noted in recent months: our own Chris Heckert, Managing Director and Supervising Principal of Generational Capital Markets, Inc. (an affiliate of Generational Equity) contributed to the M&A Advisor Roundtable entitled “Manufacturing in Motion”. In this, he and other M&A professionals noted how U.S. manufacturing is primed to be more competitive on the global stage soon, and this is already clear to see in the middle-market.
With manufacturing companies representing a sizeable chunk of middle-market businesses (over 17 percent), when they are enjoying a successful spell, it provides a boost to this whole section.
According to research from the National Center for the Middle Market in their 2Q 2017 Middle Market Indicator, manufacturing enjoyed revenue growth greater than the average for all middle-market firms. This growth is also expected to continue for the next 12 months (albeit at a slightly slower rate), as business owners remain overwhelmingly confident in the U.S. economy and willing to invest extra cash into building their company.
This is not all, as middle-market manufacturing firms:
This is a direct result of manufacturing in the U.S. becoming leaner, agile, and more competitive in the global market, indicators we noted in “Manufacturing in Motion”. Also, the key role these firms play in the supply chain for both smaller and larger companies means the middle-market now feels more important than ever before.
Of course, there is still room for improvement. For most middle-market business owners in the manufacturing sector, closing the skills gap and investing in new technologies are the biggest issues to be addressed. Fortunately, around 80% of these are interested in investing in their future. For those in this bracket, a number of M&A strategies could help generate wealth to invest in growth, which will increase your business valuation when you decide to exit.
What does this exciting period in middle market manufacturing mean for M&A activity? Well, it is not just our team at Generational Equity that are expecting a noticeable rise in deals completed. Research collected by IBBA, M&A Source and Pepperdine Private Capital Market Project placed manufacturing firms as the most sought-after in the lower middle-market (a trend that has lasted four years). This high interest is both among investors at home in the U.S. and overseas, placing company owners that are thinking about exiting in an ideal position.
If you own a middle-market manufacturing firm, now is an ideal time to start exit planning. Even if you don’t feel ready to move on from your business, it is never too early to start preparing for the future. In this attractive market, you never know what opportunities could present themselves. What you can control is building a buyer ready business – one that maximizes the value of your company and puts you in touch with interested buyers. Taking this first step provides a clear path for the future of you and your biggest investment.
To start your journey, join us at a complimentary executive conference. Here, our experienced M&A professionals will guide you through what buyers are interested in, how to determine the best time to exit, and what key components make up the ideal exit strategy. In just a few short hours, you will feel more assured on how to manufacture the optimal exit from your company – one that secures your financial legacy and sets you up for life after business.
You can find out more information by clicking the following links:
And you can always contact us directly on 972-232-1121 to speak to one of our team directly. We look forward to hearing from you.
The information we learn from customers helps us personalize and continually improve your experience at gencm.com. Here are the types of information we gather.
Information You Give Us: We receive and store any information you enter on our Web site or give us in any other way. We do not sell or rent your personal information to others without your consent. We use the information we collect only for the purposes sending promotional information, enhancing the operation of our site, serving advertisements, for statistical purposes and to administer our systems. We DO NOT use third parties to provide customer service, to serve site content, to serve the advertisements you see on our site, to conduct surveys, to help administer promotional emails, or to administer drawings or contests, but reserve the right to do so in the future without advance notice. Our computer system protects personal information using advanced firewall technology.
Information from Other Sources: For reasons such as improving personalization of our service, we might receive information about you from other sources and add it to our account information.
Generational Capital Markets LLC may license the use of its intellectual property including but not limited to its name, likeness, and logo for the use of affiliated offices. Such affiliated offices may not be owned, controlled, managed, supervised or staffed by employees, officers, or agents of Generational Capital Markets, L.L.C. Affiliated offices may be independently owned and operated. For more information about a particular office, please contact Generational Capital Markets LLC at is office in Dallas, Texas.
This page may contain other proprietary notices and copyright information, the terms of which must be observed and followed.
INFORMATION ON THIS WEB SITE IS PROVIDED "AS IS" WITHOUT WARRANTY OF ANY KIND, EITHER EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR NON-INFRINGEMENT. SOME JURISDICTIONS DO NOT ALLOW THE EXCLUSION OF IMPLIED WARRANTIES, SO THE ABOVE EXCLUSION MAY NOT APPLY TO YOU.
Information on this web site may contain technical inaccuracies or typographical errors. Information may be changed or updated without notice. Generational Capital Markets may also make improvements and/or changes in the products and/or the programs described in this information at any time without notice.
Generational Capital Markets does not want to receive confidential or proprietary information from you through our web site. Please note that any information or material sent to Generational Capital Markets will be deemed NOT to be confidential. By sending Generational Capital Markets any information or material, you grant Generational Capital Markets an unrestricted, irrevocable license to use, reproduce, display, perform, modify, transmit and distribute those materials or information, and you also agree that Generational Capital Markets is free to use any ideas, concepts, know-how or techniques that you send us for any purpose.
Information Generational Capital Markets publishes on the World Wide Web may contain references or cross references to other products, programs and services that are not announced or available in your country. Such references do not imply that Generational Capital Markets intends to announce such products, programs or services in your country. Consult a Generational Capital Markets representative for information regarding the products, programs and services which may be available to you.
Generational Capital Markets makes no representations whatsoever about any other web site which you may access through this one. When you access a non-Generational Capital Markets web site, please understand that it is independent from Generational Capital Markets, and that Generational Capital Markets has no control over the content on that web site. In addition, a link to a non-Generational Capital Markets web site does not mean that Generational Capital Markets endorses or accepts any responsibility for the content, or the use, of such web site. It is up to you to take precautions to ensure that whatever you select for your use is free of such items as viruses, worms, trojan horses and other items of a destructive nature.
IN NO EVENT WILL Generational Capital Markets BE LIABLE TO ANY PARTY OR ANY DIRECT, INDIRECT, SPECIAL OR OTHER CONSEQUENTIAL DAMAGES FOR ANY USE OF THIS WEBSITE, OR ON ANY OTHER HYPERLINKED WEBSITE, INCLUDING, WITHOUT LIMITATION, ANY LOST PROFITS, BUSINESS INTERRUPTION, LOSS OF PROGRAMS OR OTHER DATA ON YOUR INFORMATION HANDLING SYSTEM OR OTHERWISE, EVEN IF WE ARE EXPRESSLY ADVISED OF THE POSSIBILITY OF SUCH DAMAGES.
Furthermore, all information contained within this website is the property of Generational Capital Markets.
Honored to win Investment Banking Firm of the Year 2 years running.
Over 50 awards and counting.
Sign up to receive regular email updates, industry-leading insights and details on complimentary M&A executive conferences in your area from our award-winning team
Success, you have been added to our list.