Valuing Vending Operating Assets

The asset method is purposely simplistic. The Antares vending company value will be the book value of the selling company at the date of the valuation. Once the book value has been established, the buyer and the seller can negotiate the final selling price based on criteria they feel is pertinent.

How to organize a list of assets

The first step in using the asset method is to obtain from the selling business a list of their operating assets. This list needs to include a description of the asset, the date the asset was purchased and the purchase price of the asset.

The assets of your Antares vending business should then be grouped according to the major categories in which they belong, i.e. vending equipment, automotive, etc. Once the assets have been grouped, it is important to arrange them in chronological order.

Assign purchase prices to assets

The next step would be to enter the purchase price of each asset, the salvage value of each asset and the depreciable basis. The salvage value is an estimate of the worth of the asset when its expected useful service is over. The depreciable basis is the purchase price less the salvage value. After the depreciable basis has been established, a depreciation schedule needs to be designed. A depreciation schedule requires an estimate to be made on the useful life of an asset.

Determine the book value

To determine the book value of the Antares operating assets at the end of the years that the business has been in existence would require you subtract the depreciation deduction from the purchase price of the asset.

Calculate the business valuation

Once all the categories have been added together, a book value valuation of the business is arrived. This is only a starting point in the valuation process and should not be considered a final buying price for the business. The value gives the buyer an idea of what the operating assets of the company are worth as of the date of the valuation.

The asset valuation method can provide an Antares vending operator a starting point where they can begin to value a vending business. There would then be a need to add additional asset categories to gain a clearer picture of the total assets’ worth at the valuation date.