Valuations for Melbourne wholesalers and distributors, built on supply rights, stock and working capital.
For selling or buying a distribution business, a shareholder exit, moving the business between entities, or bringing in a partner. Fixed fee, set by turnover.
A Melbourne wholesale or distribution business is valued on the gross margin it can keep earning from its supply rights and customer base, less the cost of the warehouse, freight and people that deliver it. Our valuers read the supplier agreements for exclusivity, term and change of control, test stock for slow and obsolete lines, and agree a normal level of working capital that goes with the business. Those three checks decide whether the earnings are as durable as the accounts suggest.
Supply rights are often the real asset
Many distributors exist because a brand owner or manufacturer lets them sell its products in Victoria or across Australia. That right is frequently worth more than anything on the balance sheet, and it can also be the weakest link. The valuation reads each significant supplier agreement for exclusivity, territory, term, renewal, termination rights, minimum purchase targets and, critically, what happens if the business changes hands. A change of control clause can let a supplier walk away after a sale, and a buyer will price that. A distributor with several brands, none dominant, carries less risk than one where a single overseas principal supplies most of the range on an agreement that renews year to year.
Stock, debtors and the working capital that comes with the business
Wholesalers carry inventory and extend credit, so the price of the business assumes a normal level of stock, debtors and creditors comes with it. The valuer works out that level from monthly balances, not just the year-end figure, because seasonal businesses can look very different in June and December. Stock is tested line by line where it matters: slow-moving, discontinued, damaged or short-dated items are written down to what they would really fetch. Debtors are aged, and old or disputed balances are excluded. For importers, the valuation also looks at currency exposure, how purchase prices are hedged or passed on, and the lead times that tie up cash in stock on the water.
Customers, rebates and true margin
Headline gross margin in a distribution business can hide a lot. Volume rebates, marketing contributions, settlement discounts and free freight to key customers all eat into it, and supplier rebates can prop it up. The valuer rebuilds margin by customer and by supplier where the data allows, so a buyer can see which relationships make money. Customer spread matters as much as in any business: a food distributor supplying hundreds of Melbourne cafes and restaurants is a different risk from an industrial supplier selling mainly to two manufacturers. The valuation also asks how orders are taken, whether a sales representative holds key accounts personally, and how much of the business runs through systems rather than the owner's phone.
Warehouses in the west and south east
Melbourne's distribution businesses cluster in Laverton North, Truganina, Dandenong South and around Tullamarine, and many own their warehouse through the operating entity or a related trust. If shares or units in an entity holding Victorian land worth $1 million or more change hands, the State Revenue Office's landholder duty rules may apply, with significant interest thresholds of 50% for a private company and 20% for a private unit trust. A warehouse bought in an entry transaction on or after 1 July 2024 also sits in the commercial and industrial property tax transition, with an annual tax generally at 1% of site value after 10 years while it keeps a qualifying use. The valuation treats the property and the business as separate assets, sets a market rent for the business, and leaves the property to a property valuer in Victoria. Duty and tax are matters for your lawyer, accountant or the SRO.
Licensed products: tobacco wholesale
Some distributors handle products that need a licence to sell. Since 1 February 2026, Tobacco Licensing Victoria has enforced a licensing scheme that requires anyone selling tobacco in Victoria, to the public or to other businesses, to hold a licence, with separate retail and wholesale licences and a licence for each location. Transferring a licence to a new owner needs Tobacco Licensing Victoria's approval. Where tobacco is part of a wholesaler's range, the valuation shows that income separately and treats approval of the buyer as a condition of keeping it. Licensing steps are for the parties, their lawyers and the regulator.
When Melbourne distributors are valued
- ·Sale to a competitor, a supplier or a national group
- ·A shareholder or founder leaving the business
- ·Bringing in a partner or a senior manager as an owner
- ·Separating an owned warehouse from the trading business
- ·Restructuring between family entities
- ·Market value evidence for small business CGT concessions on exit (your accountant applies them)
Common questions.
How is a wholesale business valued?+
Usually on maintainable earnings: the profit a buyer can expect year after year once owner pay is set at market rates and one-off items are removed. That profit is capitalised at a rate reflecting the risk in the supplier agreements, customer spread and margins. Stock and working capital are then checked against the normal level the business needs, with any surplus or shortfall adjusted in the price.
Is stock included in the price of my distribution business?+
A normal level of saleable stock is usually part of the business value, because the earnings depend on it. Stock above that level can be added; obsolete or slow lines are written down. Sale contracts often set the stock figure at a stocktake on settlement, and the valuation explains which approach it has used so the parties can adjust.
What if my main supplier can end the agreement?+
That is one of the biggest value questions for any distributor. The valuation reads the agreement for term, notice, change of control and performance targets, and looks at the history of the relationship. Where a supplier can end the arrangement easily after a sale, a buyer will pay less, or make the price conditional on the supplier's consent.
Do you value importers?+
Yes. Importers are valued the same way as other distributors, with extra attention on currency exposure, shipping lead times, the cash tied up in stock in transit and how reliably cost increases can be passed on. The valuation uses your own purchasing and margin history rather than assuming a stable exchange rate.
We wholesale tobacco. Does the licence go with the business?+
Not automatically. Tobacco Licensing Victoria says transferring a licence to a new owner requires its approval, and each location needs its own licence. The valuation shows tobacco income separately and treats the buyer's approval as a condition of keeping it. Your lawyer and the regulator can confirm the steps for your sale.
What does a valuation of a wholesale business cost?+
The fee is fixed before work starts and set by annual turnover: $1,495 + GST under $2 million, $2,495 + GST for $2 million to $3 million, $3,495 + GST for $3 million to $10 million, and a written quote above $10 million. Small reports take 2 business days and medium and large reports 3 business days, counted from when payment and all required information have been received.
- ·Understanding landholder duty, State Revenue Office Victoria
- ·Understanding commercial and industrial property tax, State Revenue Office Victoria
- ·Tobacco licensing, vic.gov.au
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Small Business Valuation
$1,495 + GST
For a business with annual turnover under $2 million. Signed report in 2 business days. Delivery time starts once payment and all required information have been received. The fee is fixed in writing before we start and never tied to the outcome.
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Last reviewed 11 November 2026 by Business Valuations Melbourne, Level 7, 55 Collins Street, Melbourne.