What’s Your Engineering Workshop Worth? Valuing Australian Jobbing Manufacturers in 2025

🎯 Target Focus:

Business Type: Jobbing/General Engineering Workshops (e.g., CNC, welding, machining, fabrication)

Location: Australia

Target Readers: Business owners considering sale; buyers/investors; accountants

🧩 Suggested Structure:

1. Intro: Why Jobbing Shops Are Still In Demand

“Despite supply chain shifts and automation, general engineering workshops remain a backbone of Australia’s manufacturing sector — especially those serving mining, ag, and construction.”

2. Typical Deal Sizes & Buyer Pool

Most deals <$5M enterprise value

Buyer profiles: trade-up owners, small PE firms, strategic bolt-ons

3. What Are the Multiples in 2025?

Include a real-world table like:

Profit Metric Typical Multiple (2025 AU) Notes

EBITDA 2.75x – 3.5x For manager-led, >5 FTE shops with consistent revenue

EBIT 2.25x – 3.0x Often used when depreciation is high due to capital gear

SDE 1.5x – 2.5x Owner-operator shops, especially <4 FTE

Revenue 0.4x – 0.6x Rarely primary, but used for benchmarking or very low-margin ops

🧠 Multiples Analysis

“Most deals fall around 3x EBITDA. Above 3.5x requires: reliable 2IC, consistent >$500k profit, ISO certs, or IP (e.g., proprietary jigs).”

“Over 4x? Rare. Must involve strategic buyer, patented process, or a national footprint.”

4. What Drives or Kills Value

✅ Drivers:

Asset-light model with high margins

Recurring contract clients (e.g., defense, energy)

Fully systemised job costing + scheduling

Skilled team with tenure

❌ Deal Killers:

Owner still quoting + welding

One-off customers

Heavy reliance on plant value (vs. earnings)

5. Capital Equipment: Help or Hindrance?

“Don’t assume plant value boosts valuation. Often, buyers discount for over-capitalisation or old gear with limited resale value.”

6. Conclusion: How to Get to the Right Multiple

Clean books, strong ops manager, recurring jobs = your path to 3.5x+

“If you’re still pricing jobs in your head, expect 2.5x — at best.”