How do I check a machine shop’s tooling inventory and who owns the fixtures?

Begin with the physical count. Take the seller’s tooling list and check it against the cribs, carts and drawers. Note what is worn, broken or missing, and what is simply stored with no job attached. Tooling that has not moved in a long time may be clutter rather than an asset.

Fixtures need a separate conversation. For each one, ask who designed it, who paid, and whether the purchase order or contract said anything about ownership. Customers sometimes pay for a fixture and expect to take it if the work moves. Others leave their own gauges and masters at the shop. Make a list of what is customer property and what is the shop’s, and ask for any written agreements that explain it.

Then compare the count to the books. Is tooling expensed as bought, or carried as inventory? Your accountant can tell you how it appears and what it means for the sale. If the shop uses a lender, ask whether the tooling is pledged. Ask how tooling is tracked between jobs, and who can sign it out. A shop that loses track of small tools usually loses track of larger things too.

Key takeaways

• Count the tooling yourself and compare it to the list and the books.
• List every fixture with who designed it, who paid and what the paperwork says.
• Ask whether any tooling is pledged to a lender before assuming it transfers.