Machine Shop Mastery 89. Lessons Learned from Buying & Losing a Machine Shop | Mark Heston
In this powerful and deeply candid conversation, I sat down with Mark Heston, who first appeared on Episode 51 to share his story of buying and rebuilding an aerospace machine shop specializing in landing-gear components. At that time, the business was on an upward trajectory — improving culture, repricing work, and investing in growth. But behind the scenes, hidden challenges were forming that would ultimately lead to an unexpected and difficult ending.
In this follow-up episode, Mark opens up about what happened next—the liquidity crisis, the missteps in financial due diligence, and the sequence of events that forced him and his partners to file for bankruptcy and sell the company through a Chapter 11 restructuring. He speaks with transparency about what went wrong, what he learned, and what he wishes every buyer, seller, and operator in manufacturing would know before it’s too late.
Together, we explore critical lessons in capitalization, cash-flow management, financial literacy, and the danger of relying on inaccurate numbers. Mark emphasizes the difference between profitability and liquidity—how a shop can look successful on paper but suffocate in reality when cash conversion cycles stretch too far. He also shares why “trust but verify” should be every acquirer’s mantra when reviewing a seller’s books.
This is not a story of failure. It’s a story of brutal honesty, hard-earned wisdom, and resilience. For anyone buying, running, or selling a machine shop, this episode is required listening. It’s a reminder that the toughest conversations often teach the most valuable lessons.
You will want to hear this episode if you are interested in...- (0:53) revisiting Mark’s original episode and the shop’s turnaround story
- (3:47) Buying a $7–8 million aerospace landing-gear machine shop in New Jersey
- (5:06) The dark, difficult realities of machine shop ownership
- (6:13) Check out the SMW Autoblok catalog to leverage RASRAM
- (7:38) The two biggest challenges: Unreliable financial data and under-capitalization
- (9:45) Liquidity vs. profitability — “cash is oxygen” for any machine shop
- (13:25) Doing due diligence right: Stress-testing scenarios and working capital needs
- (15:40) The danger of leverage (and when debt turns into a liability)
- (17:11) The importance of hiring a trained eye to validate what you’re seeing
- (19:08) Focus on the fixing the balance sheet before anything else
- (22:19) Customer cancellations, Boeing delays, and a bad material batch
- (25:08) How one wrong material spec halted production
- (27:17) Don’t let outside processing keep you awake at night
- (30:01) Why attention to detail in inspection and receiving matter
- (32:05) Capitalization and line-of-credit lessons
- (34:36) Growth, pricing decisions, and the danger of being too cautious
- (36:30) Job costing challenges and why small shops often fly blind
- (39:20) When small-business financials mislead (tax tactics and poor data)
- (41:21) The sale, Chapter 11 process, restructuring and new ownership
- (44:21) Employee retention and operations continuing
- (44:47) Workholding Wisdom: SMW Autoblok’s flexible, automation-ready workholding
- (51:10) A reminder why cashflow is king in any market—even thriving ones
- (55:42) What to think about (and do) if you’re planning on selling your business
- (1:01:26) Make sure you’re not emotionally attached to buying a business
- (1:07:00) Why we created Hire MFG Leaders to help you find your next leaders
- Episode #11
- Episode #51 with Mark
- Episode #64 with Jereme Rodgers
- Check out the SMW Autoblok catalog to leverage RASRAM
- Get the transparency you need from outside processors at Phoenix Heat Treating
- Use Hire MFG Leaders to help you find your next leaders
- Connect on LinkedIn
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