Inventory Profiling

Value Resource Group, Inc. specializes in asset-based lending appraisal, liquidation, auction, and consulting services. After 30 years of serving clients throughout the world, we’ve recognized the need for a valuation service not previously offered in our corner of the industry: inventory profiling.

Profiling is often referred to as the halfway point between “desktop opinions” and “complete, narrative appraisals.” As such, it’s primarily used when neither of the former valuation levels is feasible due to time constraints, cost, borrower reservations, or any number of mitigating factors. Our impetus in offering this service is based on our understanding of the existing system’s inherent challenges, specifically the reliance upon phone polling with limited information.

Thanks to our proprietary software, profiling is seamless in migrating borrower data over the internet. It provides an inventory profile with no more effort than the simple inquiry method currently used. Most importantly, profiling provides user-friendly and accurate sets of tools for collateral and/or field examiners with little time to examine inventory records. It allows for complete and thorough analyses of perpetual inventory at the line-item level.

For example, a given borrower’s perpetual inventory may contain around 100,000 unique part numbers. In situations like these, it’s virtually impossible for collateral and/or field examiners to analyze such an immense database. In most cases, however, our profiling software can analyze that inventory in a matter of hours. The advantage to the lender is undeniable.

When in the simple profile summary format, the collateral monitoring process is quick, inexpensive, and effective. It’s also far more efficient when compared with any of the current methods available.

From the perspective of the relationship manager, it should be emphasized that profile data requests are merely simple amendments to the data requests utilized in standard audits. Further, they combine the advantage of drawing on field observations from collateral and/or field examiners while utilizing the breadth of experience and actual liquidation background of the appraiser. This combination of efforts (and the resulting profile) can be used and adjusted periodically by the collateral and/or field examiner without additional effort or expense.

Profile Requirements

Generally, the scope of a profile is based on the size and complexity of the inventory. It initially includes the following:

  • Requesting data from the borrower for data transfer into VRG software
  • Secondary consultation and submission of a detailed slow-moving/obsolete inventory to the borrower
  • Consultation with the collateral and/or field examiner, or if requested, the relationship manager on existing accounts
  • Segregation of inventory into appropriate classifications
  • Calculation of liquidation value recoveries for each class
  • Estimation of liquidation expenses for determination of the net orderly liquidation value (OLV)
  • Compilation of the Profile format
  • Profile downloads in Excel format
  • Profile transfers to the lender

Elements Unique to Each Job

  • Data Set-Up Time
  • Turn Analysis
  • Profiling

Pre-Qualifying Factors

  • Data File Size
  • Data Cleanliness
  • Number of Companies Involved
  • Borrower Cooperation (Response Time Critical)
  • Inventory Profiling Requirements Case Study

A Case Study in Inventory Profiling Requirements

Contact Value Resource Group, Inc. with questions or concerns about our original approach to inventory profiling.

Simplify your approach to inventory management. Call (303) 357-2393