Services
Business and Economic Consulting
Case studies
Coal loading facility - Economic Impact Assessment
CIPL was asked to provide an economic impact assessment to be included in an Environmental Impact Statement for a proposed coal loading facility. The work involved collecting and analysing detailed and region-specific baseline data including the status of employment, housing and commodities markets, and the availability of social and commercial infrastructure. The report assessed the impact of the proposed development on the existing economy, addressing areas where economic pressures might arise.
Business plan – Wood products
Our client expected to be awarded a contract to clear a dam floor of timber ahead of construction. The client considered that the timber harvest may have commercial value, and engaged CIPL to assess the value of the potential harvest and to set in place a plan to commercialise the timber. CIPL sought out industry marketing and harvesting partners and CIPL’s modelling raised a number of issues pertinent to the economic assessment of the project. Combined, this resulted in a business plan which was used as the framework for a proposed forest product’s joint venture.
Corporatisation of a local family business
Following a staff retreat, a local consulting business decided to move away from a family business structure to a more corporate structure. CIPL was approached to assist with this ongoing project which to date has involved making an assessment of the current structure of the business, and making recommendations as to the most appropriate future structure, given a desire to include staff and business partners as shareholders. After making suitable recommendations, CIPL provided an indicative valuation for the business and implemented a staff share plan. Next steps involve assisting in corporatising the board and assisting the business to find suitable acquisitions.
Corporatisation of a Sydney-based dental laboratory
The owner of a Sydney based dental laboratory received an offer to buy his business and approached CIPL to assess the merits of the offer. CIPL found that the offer was extraordinarily low, and in fact was equal to only one years’ normal earnings, and tied the existing (fastidious and talented) owner to a commitment to quality that he had no say over. CIPL made detailed recommendations to corporatise the business, including implementing a two-tier pricing structure, off-shoring lower value work, and setting in place a succession and acquisition plan.
Commuter rail project
In conjunction with another consultancy, CIPL undertook the economic modelling behind a feasibility study to implement a commuter rail service between Rockhampton, Gladstone and Bundaberg. The study looked at above and below rails cost and the benefits of providing such a service including externalities such as quantifying the possible reduction in road accidents over the corresponding notorious stretch of highway. The study included an assessment of the expected subsidy that may be required to ensure the continued operation of the service.
Residential building project
A consortium of investors purchased several blocks of land intending to undertake a residential development. Over time, the enthusiasm of the group waned and they approached CIPL for guidance. CIPL undertook economic modelling to establish the feasibility of the project, and market research to indentify the likelihood of the project generating an ongoing income stream. CIPL met with the group recommending the preferred outcome and options for financing the development.
Valuation and sale of an engineering consultancy
A Sydney based engineering consultancy was approached by a potential acquirer. Directors were unsure as to whether the offer was reasonable, and sought CIPL’s advice regarding an appropriate valuation. CIPL used DCF methodology, valuation multiples and comparisons with actual transactions to establish an estimated valuation. The valuation process uncovered several weaknesses in the company’s current revenue structure, that were brought to the attention of directors, which the aim of increasing the company’s long term value ahead of a mandate for sale.
Valuation of a Melbourne-based water consultancy
A rapidly growing Melbourne based water consultancy had been using "back of the envelope" calculations to establish prices for the company’s staff share plan. A significant jump in profit led management to see a more formal estimate. CIPL modelled the company’s operations and used DCF methodology, valuation multiples and comparisons with actual transactions to establish an estimated valuation.
Share issues
CIPL's licensing arrangements and experience has enabled it to issue and/or underwrite share issues for The Investment Collective, the Capricorn Diversified Investment Fund, and The Rock Building Society Limited.
Perth reconstruction
This Perth based company was experiencing rapid growth but was suffering from gross lack of systems and financial structure. The pressure on the business was such that certain directors could not agree on an outcome, resulting in legal action between them. CIPL identified several parties willing to invest or to provide debt funding, but the dispute between the directors became so serious that the company was put into administration. CIPL worked with the administrator and two of the directors, finding a sponsor for a new venture, and through this, contracts and the business were rekindled in another form.
