Fixed fees for industrial business valuations

What does each fee band cover?

Each band covers a full written valuation of one business or one parcel of shares, at one valuation date, for the purpose agreed in the engagement letter. The band is set by turnover because turnover is a fair guide to how much there is to analyse. Here is what usually sits in each one.

Smaller industrial business

From $1,495 + GST, for annual turnover under $2 million. Delivery in 2 business days. Delivery time starts once payment and all required information have been received.

Typically a single-site operation trading through one company or trust: a jobbing machine shop, a small fabrication workshop, a specialist distributor, a maintenance contractor running a handful of service vehicles. The owner is usually central to quoting and to the customer relationships, so much of the work goes into that dependency and into what the plant is really worth to the earnings.

Established industrial business

From $2,495 + GST, for annual turnover $2 million to $10 million. Delivery in 3 business days. Delivery time starts once payment and all required information have been received.

Contract manufacturers, engineering firms with a production manager or estimator below the owner, regional transport operators, and food or packaging producers supplying retail and industrial customers. There are more moving parts: supply contracts, financed equipment, a meaningful stock and work in progress position, and often a related entity that owns the premises.

Complex industrial business

From $3,495 + GST, for annual turnover over $10 million or a complex structure. Delivery is agreed before we start, because it depends on the structure and the information available.

Multi-site manufacturers, businesses with several operating divisions that carry different risks, businesses with export or import exposure, and valuations where a new contract or an expansion means history is no guide and the cash flows have to be forecast.

A complex structure here means a business with several operating divisions or sites to analyse, not simply more than one entity. The common arrangement where one company trades and a related trust owns the plant, the fleet or the premises stays in the band its turnover sets, with $795 + GST for each additional entity. A group of separate operating companies is quoted individually.

Independent expert and complex matters

Quoted individually. Delivery is agreed before we start.

Shareholder and partnership disputes, litigation support, complex groups of separate operating companies, and highly specialised matters. The fee depends on the documents involved, the number of valuation dates, whether the other side has its own valuer, and whether the report has to meet a court's expert evidence requirements. See dispute valuations.

Not sure which band applies? We use the business's annual turnover and confirm the band on the scoping call, before anything is charged.

What changes the fee?

• An additional valuation date: $495 + GST each. Common in restructures, in shareholder disputes that need a value at the date of the falling-out as well as today, and in estates that need the date of death and a later date.
• An additional entity: $795 + GST each, in any band. Common where one company trades, a related trust owns the plant or the fleet, and a third entity holds the brand or the designs. Extra entities on their own do not move a business into the complex band.
• A move to the complex band: turnover over $10 million, several operating divisions or sites, or a forecast-based valuation because a contract or expansion means the past is not a guide to the future.
• Court, tribunal or expert evidence: quoted individually as a separate engagement.

If the scope changes after we start, for example when a second entity turns up in the information, we tell you and confirm any change in writing before doing the extra work.

What is not included in the fee?

• A formal plant and machinery valuation. That is a separate discipline done by a plant and machinery valuer, usually for finance, insurance or a sale of assets. If you already have one, we can use it as an input.
• A valuation of land and buildings. Where the business owns its factory, depot or warehouse, a property valuer values the property. We can use that valuation and set out how the property is treated.
• Tax, legal or financial product advice. We value; your accountant, lawyer or adviser advises. We do not provide legal, taxation, investment or financial product advice.
• An audit or due diligence. We rely on the information supplied and test it for reasonableness, and the representation letter you sign records that it is complete and accurate.
• Preparing your forecasts or business plan. Where a forecast matters to the value, we review and test yours.
• Site visits and travel. Most valuations are completed from documents and conversations. If the operation or equipment needs to be seen, we say so when scoping and agree any visit and its cost first.
• Court attendance and expert reports for proceedings. These are a separate engagement.

How long does a valuation take?

2 business days for a smaller industrial business and 3 business days for an established one. For complex and expert matters, delivery is agreed before we start. Delivery time starts once payment and all required information have been received.

The quickest valuations are the ones where the information arrives complete: three years of financial statements, the current year to date, the equipment register with finance balances, and revenue by customer. Our valuation readiness check shows what to have ready.

Working to a settlement date, a board meeting or a lawyer's timetable? Tell us your deadline and we will tell you on the call whether we can meet it.

Why a fixed fee and not hourly billing?

We confirm the fee in writing before we start. No hourly billing. A fixed fee means the cost does not grow with every question we ask, and it has nothing to do with the value we reach, which is part of what keeps the valuation independent. The engagement letter states the scope, the valuation date, the interests being valued, the information we need, the fee and the delivery basis.

The fee is invoiced when you accept the engagement letter. Delivery time runs from when payment and all the required information have been received, so the clock and the work start together.

What about family law and court work?

Family law matters are prepared through our dedicated family law practice, Family Law Valuations. Its fees are $2,495 + GST for a Settlement Valuation and $4,495 + GST for an Expert Report, and its guide to which report you need explains the difference. Our family law business valuation page covers how an industrial business is valued in a property settlement.

A report prepared for a commercial purpose is not an expert report for a court or tribunal. If expert evidence is needed, that is a separate engagement with its own scope and fee. Where work already done can be used, the fee you have paid is credited, so no work is charged twice.