“The machines are fine” is a reassuring sentence with a very small amount of information inside it. A buyer still needs an explanation. What has been checked? What work is proposed? Which number describes the plan actually being discussed?
BDC’s sale-preparation guidance includes maintaining equipment, reviewing investments and keeping records. It also says a plan can help explain unresolved issues. Our exercise below turns that starting point into a conversation an owner can prepare, without assuming that spending more produces a better sale price.
Start with evidence, not a verdict
BDC’s buyer guidance lists model numbers, purchase dates, operating records, maintenance schedules and warranty details. Our seller-side adaptation adds a date, an unanswered question and a person responsible for the next answer. It is a preparation format, not a required buyer form.
BDC’s equipment-planning discussion recommends examining existing equipment and tracking cycle time, uptime and maintenance downtime. It covers additions, planned downtime and replacement cycles. Those are prompts for investigation, not a diagnosis of your machine.
What is the project meant to accomplish?
BDC’s replacement guidance recommends comparing equipment with operating needs, considering effects on the wider operation, and consulting operators. It also flags training and downtime. Before comparing projects, explain whether each proposal addresses existing work or a different intended output.
This is a way to describe the decision, not an accounting classification. A spreadsheet label does not establish what a machine needs or whether a project can wait. Keep the proposed purpose visible while the appropriate people examine the underlying facts.
For a project aimed at different output, ask the owner to finish the sentence: “We would use this option to do ___.” Then ask what the present plan already does. If the answer changes during the discussion, update the stated purpose before comparing the amounts. Otherwise two people can appear to disagree about the cost while actually describing different jobs. The exercise is to expose that difference, not to assume the more ambitious option is better.
Compare the actual scope
BDC identifies possible costs beyond a machine’s base price, including installation, training, space, financing and maintenance downtime. Check the actual proposal: some items may already be included. The source’s list is not a complete budget for your project.
For our example, every company, asset, document, amount and arrangement is invented. Alder Components is considering work on two separate assets, A and B. We use six numbered months and Canadian dollars. This is a deliberately limited comparison, not a report about an actual manufacturer.
A has a C$8,000 service project. B has two mutually exclusive choices: a C$60,000 replacement or a C$85,000 upgrade. Either B choice has stipulated installation and training of C$7,000. That amount is additional in this example, not assumed additional in every supplier quote.
Call the first choice Plan R. Its intermediate total for B is C$60,000 + C$7,000 = C$67,000. Add A’s separate C$8,000: C$75,000. A is not part of B’s C$7,000, so this addition does not count the same item twice.
Call the other choice Plan U. B becomes C$85,000 + C$7,000 = C$92,000. Add the same C$8,000 for A: C$100,000. The difference from Plan R is C$100,000 − C$75,000 = C$25,000. Nothing else changes between these two stipulated plans.
Do not add C$60,000 and C$85,000 together: Alder chooses one B option. Equally, the C$25,000 difference is not a demonstrated benefit. We have supplied no additional revenue or other result that would establish whether paying it is worthwhile. The comparison has clarified the choice; it has not made it.
These are defined spending subtotals. Financing, tax, salvage, operating-cost changes and lost output have not been calculated. Nor have we established a complete lifetime cost, equipment value or sale price. Write the scope beside the amount so “C$75,000” does not gradually acquire a meaning the example never gave it.
Move the date; keep the amount visible
Now return to Plan R. Stipulate that A’s C$8,000 is paid in month 1. B’s C$67,000 is paid together in month 2. For this teaching exercise, the machine and its associated work share one payment date; real payment terms have not been established.
The first schedule therefore contains C$8,000 in month 1 and C$67,000 in month 2: C$75,000 across the six-month window. Now move the entire C$67,000 to month 5, holding every price fixed. The revised schedule contains C$8,000 in month 1 and C$67,000 in month 5. Its subtotal is still C$75,000.
The second schedule has less of this named spending early in the window. It has not made the amount disappear. No starting cash balance, other payments or minimum cash requirement was supplied, so neither schedule shows that Alder can afford the plan. And the arithmetic cannot establish that waiting is feasible or safe.
Complete two records before the meeting
Here is how Alder’s owner, Maya, could document the discussion. All names and dates in these records are invented. “Preparation day 1” and “day 3” describe the example’s record sequence; they are not recommended inspection intervals.
Record A — model A-100, purchased in fictional year 2018. The operator’s day-1 note says “running normally”; the maintenance record lists four stoppages in its stated period. Maya marks the difference unresolved and asks operations lead Sam to explain the entries on day 3.
A’s C$8,000 remains the stipulated figure in both plans. Sam’s answer must address the question; simply copying the number into a fresh document would leave it unanswered. If new information changes the proposal, Maya preserves the earlier version and identifies the changed input before recalculating.
Suppose Sam explains that the first comment describes one observation that day, while the four entries cover an earlier period. Maya can now record why the notes differ. She cannot write “no further work needed”: Sam has not supplied that answer. The clarification improves the record without turning a narrow answer into a broader conclusion.
Record B — model B-200, purchased in fictional year 2015. File B1 contains the two proposals; its warranty-detail field is unconfirmed. Maya asks the supplier to clarify that field and records the response date. She does not convert a blank field into a positive claim.
B1 labels Plan R at C$67,000 and Plan U at C$92,000 before adding A. Beside them, Maya writes “choose one”. She also retains an unpriced question, B-Q1, outside both subtotals. Until its amount and relevance are resolved, neither C$75,000 nor C$100,000 is presented as a complete funding requirement.
BDC recommends internal and external expertise for due diligence, including equipment assessment. Bring the unanswered questions to that discussion. The useful handoff is an explanation of what is known, what is assumed and what answer comes next—not a more confident adjective beside the asset list.
For general information and education, not legal, tax, investment or valuation advice. The fictional example is illustrative and does not predict your business’s value, financing terms or sale outcome. Consult qualified advisers about your situation.
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