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Goodwill Valuations

Value is not related to just 'bricks and mortar' alone, a business is a going concern, with fit out, a customer book and this has a value to an incoming purchaser who carries out the same sort of trade or business. This is a specialist area where the Valuer will asses the trading potential and remaining useful life of any plant and equipment.

To best assist the Valuer, accounts, trading figures, vat returns, staffing compliment, owner workers and growth plans are all relevant

Goodwill valuations are a specialist valuation discipline that combines valuation principles with a detailed analysis of the business accounts, it is a valuation of the bricks and mortar (the buildings) and a valuation of the value of the property as a trading location with an established customer base, ready and fitted out for use. A goodwill valuation is usually required when somebody is buying a “going concern” or trading business (the property + the customers + the fixtures & fittings) as opposed to perhaps buying an empty shop to start their own business.

To the accountancy world ‘goodwill’ can be defined as a non-financial fixed asset that does not have a physical substance, but is of value to a business.

A business valuation is an assessment of the businesses trading potential and includes:
  • value of the buildings
  • value of any plant & machinery including trade fixtures, shop fittings, furniture and equipment
  • the trading value of the business often called ‘goodwill’
  • any transferable licences, consents, permits etc

Goodwill whilst intangible arises from as a business’ reputation, repeat customer base and perhaps trading location, for example, newsagents, hotels or restaurants.

Ringley’s approach

Our approach is to gather information on your business by using our specifically designed questionnaires. To assess the business income we will need sight of 3 years accounts together with any recent management accounting. We are experienced valuers of hotels, bars, restaurants, theatres and petrol stations throughout London, the South East and the Midlands; and our valuations are accepted by all major banks and building societies.

Rics
The Royal Institution of Chartered Surveyors (RICS) represents the property profession in 146 countries, and regulates its ‘Chartered’ members. All valuations are subject to the RICS International Valuation Standards otherwise known as the ‘Red Book’.
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