Accelerated Manufacturing Brokers: Frances Brunelle

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Frances Brunelle, President of Accelerated Manufacturing Brokers, shares her story with us of how the company got started– and key insights into her field!

 

 

Danny:

Okay, well, welcome today’s episode of IndustrialSage on our Executive Series. I have the extreme pleasure of talking to Fran Brunelle, who is the President of Accelerated Manufacturing Brokers. Fran, thank you so much for joining me today on IndustrialSage.

Frances:

Danny, thanks for having me. It’s a pleasure to be with you today.

Danny:

So Fran, so tell me a little bit about your journey. How did you get to where you are today?

Frances:

(laughs) Okay.

Danny:

I know it’s a little question, right?

Frances:

Yeah, a little question with a with a big answer. So I actually started my journey in servicing the manufacturing community, believe it or not, as an industrial auctioneer.

Danny:

Oh, wow.

Frances:

Yeah. So we were helping manufacturers exit their business when there was some sort of need to exit. Sometimes there was a medical issue. More often than not, it was that they were in financial trouble. And the auction process is an accelerated way to exit from a company. But interestingly, the companies that were buying the manufacturing equipment for us were growing thriving manufacturers that were consistently trading out their pieces of equipment for a newer piece, the more modern piece, right? And it was at their behest that we began our journey in the M&A field.

So one of our longtime buyers came to me and said, “I’ve just been diagnosed with pancreatic cancer, and you can sell my company.” And I said, “I love you, Scott, but I don’t do that.” And he said to me, “Yes, you do, kid, you just don’t realize it yet.” And he said, “Think about it! Everyone that you’re marketing to are growing manufacturers, they’re likely buyers of my company.” And so I very reluctantly agreed to take on that project, sold the company in record time, had three offers for him to choose from.

Danny:

Wow.

Frances:

And PS, he beat the cancer.

Danny:

That’s awesome, that’s the best part of the story.

Frances:

Yep, he beat the cancer he left, he lives in the Carolinas now, and owns a bakery with his wife. The wife said, “Hey, it’s my turn now.” After it was all said and done. So I really didn’t… we did not immediately continue in M&A work, we were the auction time. So this was the 1990s, think about how manufacturing was leaving to Mexico, to China in that time period, we were so busy, had more business than we knew what to do with. But that same thing happens again where a buyer came to us and said, “Hey, I need to sell my company.” In that case, it was a company that had taken on more orders than they had the ability to produce.

Danny:

Oh, yeah.

Frances:

Yeah, and so it was a unique problem. And we had to marry them with someone with massive production capability almost instantly, or they would have lost the business. That project we sold… It was a Charleston, South Carolina based company that we sold to a buyer up in Rhode Island. That project was so much fun to work on.

Danny:

What made it so fun?

Frances:

Oh, the characters involved.

Danny:

Okay.

Frances:

And that’s a whole ‘nother story. But I think at that juncture, I said, “Okay, I really want to do this when I grow up.” And for a very long time, we ran two divisions, both auction and acquisitions. But eventually we grew. The M&A side grew over 400% for three years running.

Danny:

Year over year?

Frances:

Yeah.

Danny:

Wow, okay.

Frances:

Yeah. And so at that juncture, we just, we closed down the auction division, I refer all my old work to an old competitor in the industry, a friendly competitor and,

Danny:

That’s great.

Frances:

Yeah. And so I love what I do, I have an awesome team, we meet the most interesting people. Manufacturing today is so different, the public perception of it, that’s why I love what you’re doing. You’re helping change the perception and that’s a beautiful thing.

Danny:

Wow! Thank you, because we totally 100% identify with that. And you know, what is going on in manufacturing is amazing, it’s awesome, and if you really think about it, just think of all the amazing technical new evolutions and innovation that have happened, it’s from people taking risks and doing super cool things. You know, people get excited about, “Oh, we have SpaceX and look at Apple, look at…” Okay, well, let’s look what’s kind of going on behind the scenes there. It’s not like it’s, you know… So anyways, I could go on and on, but 100%. So what maybe, I’m kind of curious, I want to go back a little bit even before the auction, how did you get into that?

Frances:

Okay. That was, I was, I went into that business with my husband at the time who had long since divorced. But his dad was a machinery dealer, so buying and selling used equipment. But when they came across an entire plant for sale, they would refer it to an auctioneer. And my then father-in-law over a Sunday breakfast… “Hey,” he said to my husband at the time and I, “Hey, you kids should do this. This would be a great business for you.” And my husband at the time said, “Dad, you’re crazy,” Got up to go to the bathroom, and I started scheming with my father-in-law about what it would take. And I went to my old boss at the time, I was working for real estate developers, two brothers who had 85 different corporations that I was in charge of at the time.

Danny:

Wow.

Frances:

And I went to one of the brothers and said, “I have an idea for a business. I need to borrow $40,000 to start this business.” And I had a business plan, and he said, “Where do I sign?”

Danny:

That’s awesome.

Frances:

And I paid him back, in under a year, and just before he passed away.

Danny:

Oh, wow.

Frances:

Yeah.

Danny:

So I’m going to ask you a question that we didn’t talk about on there. Where do you think this entrepreneurial spirit comes from? Because that’s an, you know, I try… here in that story that you know, it was interesting, sort of the different reactions where are saying when your father-in-law at the time proposed that, and you said you instantly started like scheming, I love that. That’s awesome. Where does that come from?

Frances:

I think, at the time, as I said, I was working for these two real estate developers who were incredible entrepreneurs. And that was my first look at small business. That was my first real look at entrepreneurship. And it was during the time that I worked for them that I realized, I want this for my life.

Danny:

That’s awesome. And but you know, I think there’s something, I think there’s something inside of an entrepreneur though that yes, you may want it, but I think there’s a, what I see and I hear is there’s this passion, there’s this excitement, that you kind of just naturally gravitate and you just you have, that’s what at least what, that’s what I’m seeing and hearing from over here, so?

Frances:

I think everybody, every entrepreneur, every true entrepreneur, you’re right, has a little bit of that. We’re a little bit renegade. We don’t like following rules. We like making it up as we go along, making our own rules. And so yeah, I’ve got a little bit of that, I bet you do too.

Danny:

A little bit, yeah, just a little bit. So we’ve got a little bit of story, obviously some kind of turning points in there, obviously asking questions: “Hey, what about this business,” and then you launch into the whole auctioneering business, and then you have customers that say, “Hey, you should do this.” “Oh, I don’t know, that’s happened a couple times,” and voila, there you go. So, today, we you know, what is… we talked about for that passion that you know, that excitement… when you get out of bed, when you start every day, what… What’s that motivating factor? What’s that piece that’s like, “Yeah, today we’re going to do this”? Like what is that? What’s that drive?

Frances:

Oh my gosh. Well, last year, I traveled more than 40 weeks out of the year.

Danny:

Okay, that’s a lot of travel.

Frances:

I traveled all over the country. I am meeting the most fascinating people, absolutely the most fascinating people in the country. The manufacturing community it’s so incredible, so many different from medical instruments that are changing the way surgeries are done to things that are used in every home in America, to parts that are going up in space. It’s just… It’s absolutely amazing. And I love the travel and meeting people and learning, the same way you ask me, “What sparked this? How in the world did you ever think of this?” Doing that so many times in a year is just, it’s inspiring.

Danny:

Yeah, absolutely. That’s super cool. You know, it’s just amazing in this space when you just hear even just how niche or niche or whatever how you pronounce it, you know, just and just the smallest detail, there’s a manufacturer for you know, the tool cutting apparatus for cardboard, for cereal manufacturers and like this, this whole supply chain that you, a whole world that you have no idea about, you know, that helps to get my cereal to, but you know, like all these different things, I think it’s just crazy fascinating.

Frances:

Yep.

Danny:

So, let’s jump into a little bit more, you know, present day: what are some of the challenges that you’re seeing in the industry right now? Obviously, there’s a lot going on, a lot of transformation is happening. What are some of those challenges you’re seeing?

Frances:

So one of the biggest challenges that we see, manufacturers are, the ownership is of an age, they’re retiring in record numbers. Everybody talks about the skills gap, right?

Danny:

Yep.

Frances:

Which we could do a whole episode just on the skills gap. And now some people just complain about it, and others are actually doing something about it.

Danny:

Right.

Frances:

Right, but, so you think about, there’s things like Manufacturing Day, which is awesome, and it’s, you know, a tool to try to inspire young people into the manufacturing industry, a worthy cause, right? But the issue that I see is that the young people being inspired into manufacturing are not at a level yet where they could take over ownership of the companies that, where the founder is retiring.

Danny:

Yeah.

Frances:

So what happens in the meantime? One of the strongest categories of buyer right now of manufacturing companies, and this is not me, this is the Market Pulse Report put out by Pepperdine University, tracks my industry quarterly. So for the last several years, almost every quarter, with few exceptions, the largest category beating out private equity and large strategics… are guys leaving corporate America– not necessarily within the manufacturing community, but leaving key positions in corporate America to acquire manufacturing companies. Manufacturing has been the most sought after acquisition, quarter after quarter, again with few exceptions.

Danny:

Why do you think that is? What are some of the driving forces behind that, you think?

Frances:

It’s the opportunity for growth. Listen, a lot of people for many years think the stock market is on an artificial high, right? Okay.

Danny:

Yep, yeah.

Frances:

So right now it’s hitting…

Danny:

Record levels.

Frances:

Records almost every day.

Danny:

Yeah.

Frances:

But manufacturing is more solid, it’s a safer investment. And it’s one. So you think about the founder, led companies, the guys that are retiring. Oftentimes the skill set of the people coming in, these guys leaving Corporate America, its sales and marketing, the function most commonly deficient in the founder led companies. So they can come in, add this skill set, business development and with a few small tweaks, they can double, triple, quadruple the size of a company. It’s amazing. But to answer your question, that’s the largest issue I see in manufacturing is, can we get enough of these people with this skill set to buy these companies? Because if you can’t, the entire US economy is going to be affected.

Danny:

Yeah, exactly.

Frances:

Right?

Danny:

Yeah, and so one of the interesting things is, you know, is there particular size of firm that you, like this report was coming from the work with, me I know that most manufacturer, I mean, there’s a ton of them, most of them are fairly small, I think around one to two million each in revenue. Correct me if wrong, I’m sure you probably better on the numbers than I am.

Frances:

So the report that I referred to segregates what they call “main street.” Main street companies with revenues under two million.

Danny:

Okay.

Frances:

And this report isn’t only tracking manufacturing, it’s tracking the mergers and acquisitions community and what’s selling nationally, but not necessarily manufacturing.

Danny:

Got it, right.

Frances:

They do track what industry has sold. So then they’re generally from two to five million, they’re putting in another category, and then from five to 50 million.

Danny:

Okay.

Frances:

So, even up to 50 million, they’re calling that lower middle market, and it is.

Danny:

Sure, yes, yeah. I think that’s super interesting, though, that, you know, I would have guessed that it would have been more, you know, PE or, you know, strategic acquisitions rep versus, you know, that corporate, you know, executive who, you know, I just think that’s very, very interesting.

Frances:

Well, it’s the… those are the three categories of buyers. So of course private equity, large strategics, and then individual buyer. The individual buyer is, in my industry, we call it low-hanging fruit. Finding a private equity or a large strategic, anybody can do that.

Danny:

Right, yeah.

Frances:

Anybody, because there’s lists you can buy, there’s things you can do. With that third category of buyer, there is no list you can buy.

Danny:

Yeah.

Frances:

You have to create the conditions to be found by them. So this is why marketing, blogging, video for me is incredibly important. It’s next to impossible for someone trying to buy a manufacturing company of a certain size to not end up on my doorstep. And that’s by design.

Danny:

Yeah.

Frances:

So what does that mean for my clients? It means that I’m exposing their company to the best and most qualified, and most category of buyer than anybody else in the industry.

Danny:

Well, that’s awesome. I think you answered my next question, and that was how is your organization, you know, how are you guys really answering that challenge and looking to stay ahead, and I think you just nailed, you know, you just hit the nail on the head right there on how you’re standing out? Because I imagine, yes, that is certainly a huge challenge. How do you find these individuals who are, I mean, that is like trying to find a needle in a haystack. So instead of, so if I understand you correctly, instead of you finding them, they’re seeking you out?

Frances:

Correct.

Danny:

Yeah, and then obviously, then you’re making the matches, the matches made in heaven, yeah.

Frances:

Yeah, but that’s seriously that’s the result of having content up there. We’re educating people. “What does a good manufacturing acquisition look like? What are the danger points? What should you be looking for, Mr. Buyer?” And if you’re doing enough to educate your market, whether you’re an aerospace component manufacturer, or manufacturing business broker, it doesn’t matter what you do, you have to have content out there for your target audience, and the more you provide valuable information to them, the better your business is going to be.

Danny:

100%, actually, I’ve got a quick question on that. When did you guys start doing that? Was there a was there a light-bulb moment or, you know, what would cause that for you?

Frances:

Sure, so probably, now, I’m going to say 10 years ago.

Danny:

Okay.

Frances:

I started reading books, I’ve been blogging for about 10 years.

Danny:

Okay.

Frances:

But how did that start? In reading books, and I don’t know if I should say a book during this…

Danny:

You can, you are more than welcome to do that, yeah.

Frances:

First one that I read was a book by David Meerman Scott called “New Rules of PR and Marketing.” And he talked about… and he has had several books since then. I mean I actually last year, a year before I saw him speak in person at a marketing event that I took my entire office to and kept for a few days in Connecticut. But that was the first book I read, and he talks very much about, you can’t just sell, you have to provide information, educational, valuable information to your audience. And if you do that on a consistent basis, you create the conditions for them to find you. Like the start of inbound marketing.

Danny:

There you go.

Frances:

Right.

Danny:

That sounds like a software tool that I’m familiar with.

Frances:

There you go.

Danny:

Yeah, well, very, very cool. That’s, now that’s this is great. You know, as we wrap a little bit here, for those who- well, this is a very easy question, very easy answer, I think to my question here, for those who would like to learn more about you. Maybe there’s somebody who’s watching who says, “Hey, I would like to… I’m interested in acquiring a manufacturing company.” What’s the best way to find out about you? I think I know what the answer is, but.

Frances:

Sure, so our website is AcceleratedMFGBrokers.com. Then you can email me [email protected], or you can call our office 908-387-1000.

Danny:

Perfect. Well, Fran, I really appreciate the time, I really enjoyed spending some time to get to understand your story, here about that, I loved hearing the stories about how you know, those milestone moments or those “Aha!” Where it’s like, “Oh, maybe we should make a pivot.” And just I really enjoyed also just learning about the industry, and particularly the super interesting fact about the you know, the number one buyer, you know, are going through M&A activity, we’ve not expected that. So, thank you for sharing all your information with our audience.

Frances:

And thank you for all you’re doing for manufacturing. It’s… Manufacturing companies marketing themselves, it changes the dynamic. So many guys are counting on the sale of their company. They’re tired, but they’re not marketing, and what you’re doing to educate the industry is amazing.

Danny:

Well, thank you very much. We’re trying to get that message out.

Frances:

Keep doing it!

Danny:

We will, thank you very much. Okay, all right, well, listen, I’ve really enjoyed this episode, a lot of great takeaways for me. I hope… I know there’s a couple for you as well. One of the biggest things I thought was super interesting was that the number one buyer who’s, you know, acquiring manufacturing companies are not you know, the private equity groups or even strategic acquisitions from other larger firms, it’s the actual this these corporate executives who are leaving and maybe not even in the manufacturing space, and going and buying. I thought that was super interesting. And also the the takeaway about content and marketing, and how that’s been a big driver for Fran and hope in her business.

So anyways, thank you so much for watching and listening. If you’d like to learn more about them, you can check them out at their website. We’ll make sure that’s in the show notes. And in the link here on the video, you take a look at that. I’ll be back next week with another episode of IndustrialSage. Thanks for watching and listening, and I will see you next week.

 

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