Chicago Area Engineering Firm with 25 Patented Products
Seller is willing to roll equity and stay on board for 2+ years!
The seller of this Chicago-based engineering firm is willing to both roll equity and stay on board with a new owner for 2+ years! With $1.5M in sales and a 39% profit margin, the company specializes in the design, engineering, and manufacturing of hot runner systems and components for mold making and thermoplastic processing plants. After designing and engineering the custom hot runner system to fit their customers’ plastic injection molding system, they manufacture the system on-site, assuring quality control and reduced cost to their clients. They also have the capability to retrofit existing molds; they can repair or re-configure a system, replace heaters, nozzles, and other components, and they can troubleshoot leaks, heating issues, and flow problems. All of these services contribute to their long-standing client relationships and solid reputation in the market for over 35 years. Their diverse client base consists of mold makers and processing plants for consumer goods in categories such as medical, automotive, cosmetics, caps & closures, consumer electronics, and pet products. Their customers design the product, manufacture it through 3D printing, and gives them the specs; this team then designs the custom hot runner system needed to fit their needs and requirements.
The highly skilled and experienced team includes the Owner (President/Treasurer), as well as a Design Engineer/Project Manager, 3 Machine Operators, 1 in Assembly, 1 Office Manager, and 1 Financial Officer. The owner currently handles general oversight of the business and team as well as some of the engineering; the Design Engineer/Project Manager handles all design engineering for the hot runner systems and manages each project from beginning to end.
Priced at $2,275,000, this company certainly has the potential to go global! An existing hot runner system company could take this business to the next level by using the 25 patented products, the team’s experience, and the customers already in place and expanding. A mold maker could also expand their business by purchasing this company, which would complement their services and products.
Year Established: 1984
Location: Chicago, Illinois
Service Area: Nationwide
Services: Design, engineering, and manufacturing of precision hot runner systems and components
Clients: Mold making and thermoplastic processing companies
Lease: 12 sq. ft. facility: 3k is office space, the rest is manufacturing and warehouse space; $11k/month
Reason for Selling: Retirement planning
Personnel: 8 FT, 1 PT: 2 Engineers, 4 Machine Operators , 1 in Assembly, 1 Office Manager, 1 (PT) Marketing Associate
Seller Training Period: 2 years
Growth Opportunities: Great opportunity for an existing hot runner system company to expand by using this company’s experience and customers; a mold maker could also expand their business by purchasing this company, which would complement their services & products
Current Owner’s Responsibilities: General Oversight of the business, occasionally assists the other engineer on staff.
- List Price: $2,275,000
- 2020 Cash Flow: $606,398
- A/R: $200,972
*amounts may vary
- Assets: $1,524,700
- Machinery & Equipment: $1,426,779
- Vehicles: $9,795
- Furniture, Fixtures, Software: Inventory: $88,126
- Intangible: Solid reputation in the market, long-standing client relationships
* Over 65% Collateralized *
Cash Flow Analysis
|Description of Financial Statement||P&L Statement|
|Tax Return||Tax Return||Tax Return||Tax Return||Tax Return||Tax Return||Notes|
|Net Income Shown on Financial Statement||$324,178||$383,577||$261,872||$374,302||$252,655||$73,801||$95,165||2021 adjusted for PPP|
|Compensation to Owner||$81,600||$147,030||$139,180||$138,800||$122,400||$124,000||$106,000|
|11% Tax on total W2 Salaries||$8,976||$16,173||$15,310||$15,268||$13,464||$13,640||$11,660|
|Health Insurance||$10,778||$4,636||$4,636||$4,636||$4,636||$4,636||$4,636||For personal health insurance|
|Simple IRA||$0||$16,101||$13,909||$12,449||$11,574||$3,387||$0||Personal expense|
|Gifts||$100||$0||$0||$0||$792||$1,194||$956||Non-onward going expense|
|Replacement||$-33,333||$-50,000||$-50,000||$-50,000||$-50,000||$-50,000||$-50,000||To replace owner's spouse as HR/Payroll|
|Seller's Cash Flow = Total Addbacks + Net Income||$393,606||$606,398||$398,131||$496,462||$356,645||$172,185||$183,636|
|Profit Margin||30.15 %||39.33 %||31.13 %||31.64 %||24.88 %||14.49 %||14.70 %|
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