Selling a service business is a complex process, and it can be difficult to determine the right price for a particular business. The answer to the question “How much can you sell a service business for?” is not a simple one. Generally, a business will likely sell for two to four times seller’s discretionary earnings (SDE)range –the majority selling within the 2 to 3 range. However, there are multiple factors that can influence the selling price of a service business.

How Much Can You Sell a Service Business For?

Typically, the selling range for small businesses is between two-times and three-times earnings. Outliers may be multiples of one-time or less, depending on the size of the deal and the industry. Smaller businesses (under $3M in price) generally have a selling range of 2-3 times earnings, while medium-sized businesses ($3 million-$20 million) can attain 3-5 times earnings. In doing some research, I have always read that a general rule of thumb for selling a service business is 2-3 times net profit. In using that example, the business you are selling with a net profit of $100,000 could be sold for between $200,000 and $300,000.

Service business revenue multiples typically range from about 0.4 to 1.5, with the average at 0.9 and median revenue reported in our service business data set. So, the key takeaway here is that the selling price of a service business is heavily reliant on the size of the business, its profit, and the industry.

Overall, the best way to determine the selling price of your service business is to consult with an expert business broker. At Atlantabusinesses.com, you can find a business broker who can help you accurately assess the market value of your business, as well as provide advice on the best way to go about the sales process. With their help, you can ensure that you get the best possible deal when selling your business.

At Atlantabusinesses.com, you can find the perfect business broker to help you determine the right price for your service business. With their help, you can ensure that you get the best possible deal when selling your business. So, if you’re looking for answers to all your questions about selling a service business and business brokers, visit Atlantabusinesses.com today.

What is the worth of a service business that is being put up for sale?

Calculate the business’s worth by first adding all of its assets, including equipment and inventory, and then subtracting any debts or liabilities. The value of the balance sheet will be a good indication of the value of the business.

What is the value of a business with $1 million in sales?

The worth of a business with $1 million in sales can vary greatly, depending on its profit margins and the value of its assets. Generally, the value of a business is estimated to be between one and five times its yearly sales, so this business could be worth anywhere from $1 million to $5 million.

What is the selling price of a small business?

Buyers must examine the deal as if they are buying a job. Generally, businesses in which the owner is involved on a daily basis usually sell for two to three times the yearly income of the company. For instance, if the business is making one hundred thousand dollars per year, it should be worth two to three hundred thousand dollars.

What is the most effective method for promoting a small service-based business?

1. Ensure your financials are precise and documented. Determine the value of your business, even if you believe it has great worth. Engage a reliable broker to help you identify a suitable purchaser. Finalize the agreements and complete the sale.