The Value of a Plant and Machinery Valuer

Arguably, the two cornerstones of a business are the plant and the machinery within that plant, fixed assets that can directly influence the revenue stream of an organisation. However, for such powerful resources, a hefty price must be paid, making them large investments with equally large potential payoffs.

For those of you who are not aware of what we mean by plant and machinery, these are a few of the most common examples:

Cranes
Construction machinery
Communication technology
Agriculture-related machinery
Mining
Power plant
Computers
3D printers
Transport
Labs
And more!

Due to the importance of plant and machinery, it is important that people are well aware of the estimated worth of such assets. This valuation is key for a company’s finances, insurance, reports, and more, as well as being helpful when it comes to estimating life and usage cycles.

Who benefits most from a plant and machinery valuer?

Any and all companies within industrial or commercial sectors can benefit hugely from these valuations. As with any organisation in the world, knowing the full value of your assets is vitally important. Having this information at your fingertips can assist with various business/financial decisions.

Plant and machinery equipment is often bought for direct use, although some companies also see it as an investment. Either way, the company in question will be looking for a return from their purchase, whether it comes in the form of product or price inflation. Valuation reports can allow these investors to understand the exact real-time value and condition of the equipment. Insurance companies also require this information before they can provide the correct coverage.

As such, it is sensible for organisations to enlist the help of a plant and machinery valuer regularly, consistently updating to ensure accurate information. This forms a solid base from which business decisions can be made.

For the plant and machinery valuation itself, a lot of companies use GANTPMV, an independent appraisal expert. Using a third-party valuation expert can build financial trust within the organisation, as well as promoting transparency.

How can you prepare for plant and machinery valuer?

The reason behind a valuation should be clearly defined and outlined to the valuation expert, only after the organisation has first discussed the topic with shareholders/directors etc. Ideally, the company should be providing the valuation expert with as many details as possible, increasing the accuracy of the timeline, methodology, and valuation itself. Additionally, the more information is provided, the more time is saved.

Key requirements of a plant and machinery valuer:

Complete company asset records, also known as a fixed asset register
Asset inventory – Should include description, reference number, size, model, serial number, manufacturer name, capacity, age, year of installation, as well as a list of any changes made, maintenance, and usage.
Consistently scheduled maintenance

Retooling for the future

Business is always influenced by the emergence of new technology, with modern-day business centring around the next industrial revolution, also referred to as Industry 4.0. This generation will be profoundly impacted by the likes of 5G, AI, robotics, automation, additive manufacturing, and more. As such, plants will become more technologically advanced and data-driven.

As the modern companies and the markets in which they trade, adopt such innovations, valuers too may improve and implement new tools. Asset classes will also likely adapt and change as time goes on.

When surveying large sites, drones are already being used as a helpful tool, cutting down cost and time spent. Therefore, it would not be outlandish to assume that technology such as sensors and AI could be utilised in the near future when it comes to the valuation of plant and machinery. Some of the resulting hardware may even be implemented directly into the plant and machinery itself.