Retail valuations

A key focus on bricks and mortar retail valuations is the location of the store(s) and the lease agreement(s). Bricks and mortar retail valuation considerations include the terms of the retail lease agreements such as the renewal period and termination clauses, foot traffic and location outlook and development.

Valuation issues applicable to both bricks and mortar and online retailers, include inventory requirements, supplier agreements including exclusivity details, exposure to exchange rates and changing consumer habits,, product mix and customer market size.

Inventory considerations include an assessment of inventory turnover, typical inventory requirements, the level of inventory at the valuation date and the valuation of any obsolete or surplus inventory.

Retail Valuation Experience

Lotus Amity values both bricks and mortar and online retailers. Previous retail valuation engagements have included the following:

The valuation of a fashion accessory brand, selling and distributing products through an online store and international operations. Key valuation issues included significant historical revenue growth but recently slowing, the impact of tariffs and shipment delays, changing gross profit margins and increases in senior staff. Report prepare for internal purposes to assist in future strategy.
The valuation of a sporting footwear and apparel retailer, operating from ten stores and online. Key issues included the valuation of significant surplus inventory and the impact on future margins. Share valuation report prepared to determine the cost basis for the transfer of shares to a testamentary trust for tax purposes.
The valuation of car dealerships and the floor plan financing. Valuation report prepared for restructuring purposes.
The valuation of a jewellery retailer; the expert valuation report was prepared for the Family Court.
The valuation of supermarkets; the valuation report was prepared for bank finance requirements and compliance.
The valuation of a food wholesaler and retailer to assist partners in a dispute and allow a partner to exit the business.

Why choose Lotus Amity for retail business valuations

Granular and comprehensive approach. We provide a granular and comprehensive approach to valuation. This includes modelling cash flows and discount rates and providing fully referenced appendices.
Detailed analysis. Each valuation has a story. We carefully research, analyse and explain each valuation story and how the numbers (the cash flows and discount rate) relate to that story.
Compliance. Our reports comply with the Australian accounting, ethical and valuation standards, the International Valuation Standards and the relevant expert witness requirements.
Quality Control. Each valuation report and model is reviewed for accuracy, completeness and transparency by an external firm of Chartered Accountants and business valuation specialists.