"Because we understand the lenders perspective, our approach to the appraisal process is unique to the industry."

Our Approach

Step 1: Project Definition

The Appraisal Project is defined between JC&M and our Client as to Scope (The Work Specified In The Letter Of Engagement), Performance (What The Appraisal Is Supposed To Do For The Lender), Cost, and Timeliness

Step 2: Site Visit

As part of each assignment: appropriate Company management is interviewed, documentation provided by the Company is reviewed, data pertaining to the Company's inventory and financial condition is analyzed, and the majority of the inventory owned by the Company is inspected. The appraisers will make a record of the inventory, either by video or photography, to establish a baseline against which to monitor change.

Step 3: Eligible Inventory and Orderly Liquidation Value

From these activities we then determine both eligible and ineligible categories for the purpose of an inventory advance and form an opinion as to the orderly liquidation value of the inventory over a specified period of time, along with the relative expenses, which would be incurred during such an endeavor.

Step 4: Draft of the Appraisal Report.

The scope of an appraisal report normally includes:

• A Discussion Of Primary Factors Affecting Recovery Values;
• Company And Industry Overviews;
• An Evaluation Of The Company's Inventory Based On One Or More Site Visits;
• The Company's Ability To Gather Comprehensive Data And Generate Meaningful Reports;
• An Evaluation Of Management's Use Of The Reports Generated, And;
• A Liquidation Analysis Based On The Specific Circumstances Associated With The Company Being Appraised.

Step 5: Site Visit Summary

We also provide a comprehensive site visit. For a manufacturing entity this site visit summary includes a description or discussion of: the manufacturing process; efficiencies or inefficiencies associated with the Company's plant layout, material flow, capital equipment and labor force; the sourcing; acquisition lead times and throughput of the raw material and/or parts inventory; manufacturing capacity and the current capacity being utilized; whether burden has been affected by the current manufacturing level; whether the burden is spread over the entire inventory or is carried as a balance sheet account only; the Company's classification of inventory; potential environmental or regulatory problems; and any other items of discussion we feel are relevant to the assignment.

Step 6: Business Overview as it Relates to the Inventory

For both manufacturers and distributors we include a description or a discussion of: where the purchased inventory was manufactured or acquired; inventory lead times; minimum purchases required; terms offered by vendors; potential shelf life issues; balance or size run issues; any special handling requirements; seasonality and dating issues; Federal, state, regional, or municipal licenses or permits that might be required to store or sell the inventory; potential labor union issues associated with the handling of the inventory, and; other items of discussion we feel are relevant to the assignment.

Step 7: Peer Review of Final Report and Delivery

On all assignments we feel that it is necessary to physically view a minimum of 70% of the inventory being evaluated. Satellite locations are not outsourced and an appraiser employed directly by this firm inspects all inventory. On every assignment, as a matter of course, a Senior Appraiser sees the majority of the inventory being evaluated. This same Senior Appraiser then oversees the analysis and write-up so as to maintain continuity and meaningful points of reference.

Following a compilation and analysis of all data, the appraisal will be drafted in conformity with the Uniform Standards of Professional Appraisal Practice (USPAP). Appraisals can be delivered in printed form, electronically via the Internet or on CD-ROM.

Inventory is at the heart of a business:

For Borrowers, viabile inventory is the heart of the cashflow on which the business depends. For Lenders, viable inventory is the life blood of debt service and the core collateral. The following chart shows the internal and external factors which affect the health of the inventory and its value in an orderly liquidation.