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SMB Tools / Business valuation

What is this business worth?

Estimate the value of a small business the way buyers and brokers do: a multiple of its Seller's Discretionary Earnings. Tune the assumptions, see the realistic range, and take the numbers with you.

Your earnings

Start with the cash the business actually puts in an owner’s pocket. We add these up into SDE.

Annual net profit (pre-tax)
$
Owner's salary & compensation
$
Other add-backs
$
Seller’s Discretionary Earnings (SDE)$210,000

The multiple

Industry
SDE multiple
2.5x

Typical for service business (general): 2x to 3x SDE. Recurring revenue and clean books push higher; heavy owner dependence and customer concentration push lower.

Estimated value
$525,000
at 2.5x SDE · typical range $420,000 - $630,000
SDE
$210,000
Typical value range
$420,000 - $630,000
Typical closing price
$446,250

A first-pass estimate for planning, not a formal valuation or an offer. For a deal, get a professional valuation and a CPA review of the numbers.

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