Friday, March 21, 2014

Asset Valuation as a Business Strategy


Accurate asset valuation isn’t just about assisting disposal. It helps companies raise finance for growth, and supports the organisation, investors, lenders and advisers to make informed decisions on underlying assets, such as debtors, inventory and machinery.

Liquidity Services, which operates in areas as varied as printing, biopharmaceutical, engineering, construction and mining, food and beverage, renewable energy, and automotive, is finding that more and more companies are turning to it for asset valuations to help them to raise capital.

Whatever the purpose of the valuation, whether to support business acquisition, including raising additional finance, or disposal, refinancing or restructuring, selecting the correct adviser is paramount. Liquidity Services’ global reach, experience, and its vast and growing database of asset types and potential buyers helps it to realise the best prices for its clients, regardless of their location and business sector.

“The issue is about having a proper understanding of the secondary market for a particular asset,” says Elaine Shelley, head of UK valuation at Liquidity Services. “Markets change all the time. It might be that the best market for an asset belonging to a UK company is now Australia.” Providing a realistic price, calculated with real market values in mind by an expert provider, is essential.

In the current economic climate, when banks are naturally more cautious about lending, having an accurate and up-to-date valuation plays an important role in securing a loan or overdraft. “This accounts for around 90 per cent of our appraisal work for lenders,” says Ms Shelley. “Corporates or advisers often engage directly when looking to refinance a business, and may commission an independent report to secure offers for refinancing from a number of banks and financial institutions.”

When banks are more cautious about lending, having an accurate and up-to-date valuation plays an important role in securing a loan or overdraft


Making an effective valuation increasingly requires valuers to look at all aspects of an asset – the valuation could be based on the income that it generates as well as its value. Lenders and investors are naturally concerned about their exit strategies and here too they can be reassured by a comprehensive, detailed valuation from Liquidity Services with its international network and extensive experience.

With the development of the asset-valuation sector, prompted by companies’ need to leverage all their assets fully, additional services, such as surplus asset management, are now a feature.

“Liquidity Services has pioneered a way for companies to manage assets globally allowing full visibility across all locations,” says Ms Shelley. “Through our web-based AssetZone® system, companies can improve decision-making for each asset, easily redeploying to another group location, with any required valuations being completed to support international accounting standards requirements. Or an asset can be marked for disposition through an online auction marketplace, such as our Go-Dove.com (GoIndustry DoveBid) marketplace.”

Liquidity Services is increasingly partnering with small and medium-sized enterprises, as well as multi-national companies around the world, to recover revenue from surplus equipment, inventory, and vehicles and scrap material, among other assets.

The company’s innovative and powerful online sales channels ensure maximum risk management and achieve the best deals for the end-buyer, often other businesses.

Its online marketplaces sell assets in convenient and open environments that ensure transparency for both buyers and sellers, and when paired with expert valuations, provide a valuable business solution.

To date, Liquidity Services has appraised more than three million assets worldwide.

 
This article originally appeared in Raconteur on 27th February 2014

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