How a Fourth-Generation Manufacturer Measures Success, Ep #37

What changes when you're not building a business to sell, but building one to hand down? That's the question that kept coming up for me in this conversation. In this episode of Buy the Numbers, I sat down with Jack Watson of HFW Industries, a fourth-generation manufacturer whose family has been operating the same business for nearly 80 years. Jack's story starts with his great-grandfather in 1947, fresh out of World War II, taking a bet on an emerging technology that would eventually become the foundation of HFW's identity. What struck me wasn't just the history, but how that long lineage still shows up in the way the business is run today, from capital investment decisions to how risk, debt, and growth are viewed through a generational lens. As someone who runs a business with a very different ownership mindset, I found this conversation especially valuable. We explored how thinking in decades instead of deal cycles changes what numbers matter most. Instead of obsessing over EBITDA multiples or exit value, Jack shared how balance sheet strength, liquidity, employee tenure, and operational durability guide their decisions. We also talked about leadership, tribal knowledge, and the responsibility that comes with stewarding a business that employs people who may spend their entire careers there. Whether you're in a multi-generation family business or not, there's a lot to learn from how Jack and his family think about building something that lasts. This episode offers a different perspective on success in manufacturing, one rooted less in transactions and more in continuity, resilience, and long-term stewardship. You will want to hear this episode if you are interested in... (0:00) Jack introduces HFW Industries and its four-generation legacy(3:05) The origin story: thermal spray technology after World War II(5:53) Family involvement across generations and roles in the business(7:15) We detail how Factur can generate new opportunities for your business(8:22) Family ownership vs founder ownership: different lenses for decisions(9:50) Financial conservatism born from early hardship(12:33) How long-term thinking shapes capital investment decisions(14:23) Real estate ownership and building for generations, not exits(18:04) How to ride out downturns like 2008 and COVID with minimal debt(21:18) Why you need to meet us at the 2026 IMTS Exhibitor Workshop(23:25) The financial metrics that matter most in a family business(25:49) Tracking rework, training costs, and generational skill transfer(27:46) Bottlenecks, utilization, and strategic use of top talent(30:26) Capturing tribal knowledge before experienced employees retire(31:36) Documentation, standards, and low-volume high-mix challenges(32:47) Leadership structure across generations(38:23) Grow your top and bottom-line with CliftonLarsonAllen (CLA)(39:00) Decoupling the business from individual family members(40:48) Building a pipeline of leaders who act like owners(42:32) Employee tenure as a point of pride and competitive advantage(44:58) What Jack hopes his great-grandfather would think today Resources & People Mentioned Get a free custom report of opportunities in your industry from facturmfg.com/chipsWhy you need to meet us at the 2026 IMTS Exhibitor WorkshopGrow your top and bottom-line with CliftonLarsonAllen (CLA) Connect with Jack Watson HFW IndustriesConnect with Jack on LinkedIn Connect With Buy the Numbers Follow on LinkedInConnect with Mike Payne on LinkedIn Subscribe to Buy the Numbers on Apple + Spotify Audio Production and Show Notes by - PODCAST FAST TRACK