Business Asset Valuations

At The Commercial Property Hub our Business Asset Valuation Survey teams comprise a range of highly skilled and qualified industry specialists including Chartered Surveyors, Insolvency Practitioners and Accountants, each and every one bringing a wealth of knowledge and expertise having assisted a range of individuals and organisations in both providing accurate valuations of all of their business assets, regardless of industry, whilst also ensuring they received maximum financial returns by employing a variety of best-fit disposal strategies.

Just like our property asset valuations experts, The Commercial Property Hub’s Business Asset Valuations specialist’s services are available to assist any prospective client whatever their needs.

We accept the majority of people are fairly sceptical when it comes to appointing Business Asset Valuations specialists, especially given their associations with Insolvency Practitioners (IPs) and/or Law of Property Act Receivers – and we totally get that. We’ve all heard the horror stories of their impending involvement as a business struggles, or worse still, appears to be about to give up the ghost and cease to exist.

Again, we understand that in worst case scenarios their involvement can signify the end, however, what most people don’t realise is that if a business is struggling, potentially due to cash flow or liquidity issues, which could simply be due to losing a major contract, especially in the short term, calling in a business asset specialist and exploiting their industrial expertise and knowledge could actually prove to be the deciding factor in helping your business overcome what admittedly may be a major hiccup, or spiralling into uncontrollable debt, with no hope of a reprieve.

Business Asset specialists are renowned for assisting businesses turn things around, which is why they are also called turnaround specialists, though granted, they do tend to get called in at the last minute.

The question many need to ask is ‘why do we leave it so late before trying to find a remedy?’
Similarly, we accept that Business Asset Valuations Surveyors tend to be called in by Insolvency Practitioners or Law of Property Act Receivers to appraise non-property assets deemed to have a value as part of their role to recover as much of a return as possible for the creditors, which they invariably do by accurately valuing unsold stock and apportioning market rate valuations to any plant and machinery that could realise a significant value, and again we would have to agree. However, this also begs the question as to why they have been called in by the Insolvency Practitioner or LPA Receiver? Again, this answer is quite simple, they know what they are doing and are deemed to be experts in their own fields, even by the high-end financial whizzes, frequently recognised as Insolvency Practitioners!

As an aside, and possibly an area that many people neither tend to see or hear much about is the value a Business Asset surveyor can actually add to a fully functional and performing business.

At The Commercial Property Hub, we like to think that our specialists Business Asset services are also utilised in favourable ways to confound general opinion and actually add substantial benefits to a going concern.

Arguably the best example of a beneficial involvement would concern our team being called in to ascertain the true value of a business that an owner was seeking to sell (of his own volition). In this scenario, this same owner, having operated a successful business for many years and having carefully planned his exit strategy is now seeking the requisite expertise of the Business Asset Valuations team to help him realise the true financial value of his business. Yes, he has an idea of the stock value, the property asset valuations and a notion of what the plant and machinery is worth, so with a clear price in mind, he calls in the business assets team to confirm.

The business assets team go through everything with a fine toothcomb and give the business owner their valuation. But wait, their value vastly exceeds that of the owner and so, happy but curious, he asks why? The business assets valuations team explain that the goodwill was worth an additional ‘X’ over what he thought, whilst the associated intellectual property rights added another ‘Y’, oh yes, the potential contracts in the pipeline could be worth an extra ‘Z’ and don’t forget the potential licensing agreements that could add on an additional ‘AA’. It soon becomes apparent that this business owner, like so many others seeking an exit strategy has undervalued his business, and as a result could have missed out on a significant amount at a personal financial cost to themselves.

Similarly, if you were to exploit the expertise of our Business Asset Valuation team when pursuing any expansion strategies, their inherent knowledge could make all the difference when helping you secure that much needed capital injection, especially if exploring an asset-based lending route. Their ability to identify viable lenders, allied to their capacity to provide an accurate market valuation of any plant and machinery you wished to use as collateral, could be pivotal in securing that important finance that could be the difference between the inevitable growth or stagnation of your business.

Or, how about seeking an outright growth strategy by way of a merger or acquisition? This type of move could bring that much needed growth or potential diversification, along with a sense of security for a multitude of reasons.

Again, a Business Asset Valuation specialist with their inherent knowledge, expertise and experience in having brokered similar deals in the past, may prove to be invaluable. Our Business Asset Valuations team would take the time to get to understand your objectives, help you get every aspect of your own company up to scratch, prior to devising and implementing the relevant strategies, including the identification of potential ‘willing partners’, the due diligence to ensure the fit was ‘just right’ and only then would they facilitate the deal to ensure your business objective becomes a reality.

Arguably the simplest and easiest way our teams can make a difference to any organisation is by ensuring you are paying the correct insurance premiums to accurately cover your plant and machinery assets, making sure you are paying neither too little nor too much to enable your business to continue to run, despite any undesired interventions.

When it comes to helping you attain your business goals, we suppose it is all a matter of perspective, however you are now aware your business doesn’t need to be in dire straits to seek our expertise. At The Commercial Property Hub our Business Asset Valuation specialists are here to assist you in maximising the value of your assets and can assist in the following areas:

• Business Advice
• Valuations
  
  • Businesses
  • Intangible Assets
  • Corporate Recovery
  • Plant
  • Machinery
  • Stock
  • Asset-based Lending
• Auctions/Sales
• Capital Allowances

As we touched upon above, Business Asset Valuations teams can provide a range of benefits to business owners who actually welcome their assistance, especially when attempting to maximise the valuation of their business leading up to their exit strategy.
The first case study demonstrates how one of our Business Asset Valuations specialists maximised the valuation of a client who actively wished to sell his business following his decision to retire.
The second case study highlights how one of our Business Asset Valuation teams helped a business to restructure and trade itself out of debt, whilst the third case study demonstrates the role we can play to assist creditors to recover their debts from a business that has unfortunately reached a point beyond saving.

1.  Maximising the market valuation of a business on behalf of a retiring owner

One of our Business Asset Valuation consultants was approached by a long-standing contact to dispose of his business following his decision to retire. The business was a successful private practice that was involved in a number of on-going projects, some nearing completion and others in progress. Naturally, the business would be intrinsically more valuable prior to the projects being completed and so the sale was a little time sensitive.

Our consultants met with the owner and gained a good understanding of what he wanted to achieve in terms of value and time frames. A brief was prepared highlighting the business’s attributes, including the potential for any purchaser. This was sent to approximately 1,500 contacts on our client list of potential purchasers, along with an invitation to express their interest. There was significant interest which was whittled down to thirty serious potential purchasers. Despite significant time constrains, the business was sold in a very short time frame to the delight of a very satisfied client.

2. Business restructure that allowed a troubled business to trade itself out of debt

A Business Asset Valuation consultant was approached to assist a steel fabricator and hardware retailer who was in financial difficulties. This client required a short-notice valuation of its assets to help support a proposal to undertake a debt restructuring process as part of a Creditors Voluntary Arrangement (CVA) he had agreed. The Business Asset Valuations team undertook a comprehensive assessment of the business’s tangible assets in very tight timescales to assist the client meet his agreements.

The value placed on the steel work’s assets by the Business Asset Valuations teams supported the proposed insolvency process and enabled the business to continue trading, whilst continuing to make regular payments to creditors to settle the outstanding debts.

This case serves to demonstrate the value a Business asset Valuation team can add to any business facing solvency issues if help is sought in time. Not only was assistance available to help the business owners to restructure, but the business was eventually saved, as were the jobs of the locally employed team as it successfully traded itself out of debt.

3. Business Administration – Insolvency – Helping creditors to recover debts

Our Business Asset Valuations consultants were approached by an Insolvency Practitioner following the death of a business owner and the sole client facing director of the business, resulting in the company facing an almost immediate insolvency.

Upon our client (Insolvency Practitioner) being appointed by the remaining directors and shareholders, a visit to the site was arranged to enable our consultants to gain a greater understanding of the business, in addition to getting an overview of what the business assets entailed in terms of the age, quality, condition and specific type of assets the business owned.

Owing to the nature of our business, along with the time sensitivities attached to many of the projects we undertake, we quickly undertook the required market research to ascertain as accurate a valuation as possible and sent our report to our client, which they could potentially utilise in a number of ways. In this case, it was used as a benchmark to gauge against offers being received from potential purchasers following the intention to try and sell the business as a going concern.

Following the initial, but unsuccessful efforts to enable the business to be sold as a going concern owing to a complete lack of interest, we quickly moved forward and marketed the business’s assets on a dispersal basis to facilitate the sale.

This approach resulted in our Business Asset Valuations team achieving a sale of the assets at a significantly higher figure than initially believed attainable to the delight of our client. Following the conclusion of the acquisition and the receipt of payment from the purchaser, the balance was quickly forwarded to our client.

This case highlights the typical scenarios people envisage of Business Asset Valuations consultants working in tandem with an Insolvency Practitioner. We exhausted every feasible option to sell the business as a going, but encountered no success, so the next best option was to try and salvage something for the business’s creditors
These case studies, demonstrate the discernible difference our Business Asset Valuations consultants can make to any business if you think you may be facing financial issues.