What to look for on your first shop-floor walkthrough

Financial statements tell you what a business has done. The shop floor tells you what it can do next. Your first walkthrough is one of the most important steps in evaluating a manufacturing acquisition.

Condition of equipment

Look at the age and maintenance of key machines. Ask for maintenance logs and note any equipment that will need replacement in the next few years — that is future capital expenditure.

Workflow and layout

Is material moving efficiently through the facility, or are there bottlenecks and wasted motion? A well-organized floor usually reflects disciplined management.

Safety and housekeeping

Clean, well-lit, and safe facilities signal a culture of accountability. Poor housekeeping can hint at deeper operational issues.

The people

Pay attention to how employees interact with you and with each other. Tenured, engaged staff are one of the most valuable assets you can acquire.