Determining how much you can sell your business for depends on several key factors like its financial performance, industry, size, and market conditions. Without specific details about your business (e.g., revenue, profits, or location), I can't give an exact figure, but common valuation methods provide a solid starting point.

Valuation Methods

Businesses are typically valued using multiples of earnings or revenue, adjusted for unique assets. Here's a breakdown of the most reliable approaches based on standard practices.

Method| Best For| Formula/Example| Typical Multiple Range
---|---|---|---
Seller's Discretionary Earnings (SDE)| Small businesses (<$1M profit) with owner involvement| SDE = Net Profit + Owner Salary + Perks + Non- Recurring Expenses
Example: $250K SDE x 3 = $750K value 79| 1.5x–4x SDE 9
EBITDA Multiple| Medium-sized businesses| Earnings before interest, taxes, depreciation, amortization
Example: 3x–6x for small firms 1| 3x–8x EBITDA 9
Revenue Multiple| Early-stage or high-growth firms| Often 0.6x annual revenue on average 3| 0.5x–2x revenue (varies by industry)
Comparable Sales| Any size, if data available| Look at recent sales of similar businesses nearby 3| N/A—use real deals as benchmark
Discounted Cash Flow (DCF)| Growth-oriented companies| Projects future cash flows, discounted to present value 2| Depends on growth rate/risk

These methods often blend for accuracy; for instance, a coffee shop might fetch 2.5x SDE, while a tech SaaS could hit 5x revenue.

Key Factors Influencing Price

Your sale price isn't just numbers—buyers weigh risks and opportunities. Consider these to boost value:

  • Financial Health : Consistent revenue growth, low debt, and strong cash flow command higher multiples. Recurring revenue (e.g., subscriptions) adds 20–50% premium.
  • Growth Potential : Scalable operations or market expansion can justify 1–2x higher multiples.
  • Assets & IP: Inventory, patents, customer lists, or prime location increase goodwill value.
  • Competition & Risks: Unique offerings shine; heavy reliance on you as owner hurts (buyers prefer "owner-optional" businesses).
  • Market Timing : In 2026, sectors like AI/tech see hotter multiples amid economic recovery, per recent trends.

Pro Tip : Clean books for 3 years prior make your story credible—buyers scrutinize this.

Steps to Get Your Number

Follow this to estimate and maximize your sale—many owners leave 20–30% on the table by skipping prep.

  1. Gather Financials : Pull 3-year P&Ls, balance sheets. Calculate SDE or EBITDA manually.
  1. Research Comparables : Check sites like BizBuySell or brokers for industry deals (e.g., restaurants average 2.5x SDE).
  1. Get a Professional Appraisal : Costs $2K–$10K but justifies 10–20% higher prices via credible reports.
  1. Enhance Appeal : Document processes, build a management team, cut personal expenses from books.
  1. Test the Market : List with a broker; negotiate from a 20% premium ask.

Imagine a local gym with $300K SDE selling for $900K (3x multiple) after proving membership growth—versus $600K if owner-dependent. Real stories like this show prep pays off.

Common Pitfalls & Viewpoints

  • Overvaluing : Emotional attachment leads to 50%+ pricing errors; data trumps gut.
  • Underpreparing : 70% of sales fail due to sloppy financials or no buyer story.
  • Buyer vs. Seller Views : Sellers focus on past earnings; buyers bet on future cash—bridge with projections.

Brokers say small biz sales average 6–12 months; mid-2026 market favors prepared sellers amid steady M&A.

TL;DR : Expect 2–4x SDE for most small businesses ($100K–$5M revenue), but appraise professionally for precision. Prep now to hit top multiples.

Information gathered from public forums or data available on the internet and portrayed here.