Small Business Valuation Formula Multiples, 2008 Edition
Small Business Valuation Formula Multiples, 2008 Edition, provides market-based
business valuation multiples for small businesses in more than 190 industries. The valuation
multiples are derived from actual market transactions as reported by BIZCOMPS®, with the
primary focus on small companies priced at less than $1 million. The valuation multiple
range presented in the report represents the midrange of the reported transactions for
each industry. The sample report contains a complete
list of the industries included.
Frequently Asked Questions
Which business
valuation multiples are included in this report?
What is included
in the price determined by these multiples?
How do I determine the
equity value of the business?
Why use the midrange?
How is the midrange determined?
Where can I get more
information on the transaction data?
What industries are included in
the report?
How can I order the report?
Which business valuation multiples are included in this report?
The business valuation multiples included in this report are:
Price/Revenue Multiple - Price divided by annual net sales
Price/SDE Multiple - Price divided by seller's discretionary earnings
Seller's discretionary earnings (SDE) is defined as net income before the primary owner's
compensation, other discretionary, nonoperating, or nonrecurring income or expenses, depreciation,
interest, and taxes.
What is included in the price determined by these multiples?
The price determined by these multiples includes intangible assets (such as brands, copyrights,
trademarks, patents, licenses, franchises, customer lists, and goodwill), and furniture,
fixtures, and equipment. It does not include cash, accounts receivable, inventory, real
estate, other tangible assets, or liabilities, so these items must be added or subtracted,
as applicable, in arriving at the indicated equity value for the business.
How do I determine the equity value of the business?
The equity value of the business is determined by multiplying revenue or seller's discretionary
earnings (SDE) by the corresponding multiple and adding or subtracting,
as applicable, cash, accounts receivable, inventory, real estate, other tangible assets,
and liabilities.
Why use the midrange?
The midrange is best used to determine a "typical" range of value for small businesses
based on actual market transactions. It includes both the average and the median but since
it presents a central range rather than a single point, it is less affected by individual
transactions.
How is the midrange determined?
The valuation multiples presented in this analysis are derived from actual market transactions
as reported by BIZCOMPS®, which provides transaction data on over 10,000 small business
sales transactions from a wide variety of industries. The midrange represents the middle
one-third of the reported transactions for an industry, as illustrated graphically below.
The midrange includes both the average and the median, with the midpoint of this range
closely approximating the median in most cases.
Where can I get more information on the transaction data?
The valuation multiples presented in this analysis are derived from actual market transactions
as reported by BIZCOMPS®, which provides transaction data on over 10,000 small business
sales transactions from a wide variety of industries. BIZCOMPS® data is available in print,
CD-ROM, or online versions; for more information on these transactions or to purchase
the BIZCOMPS® data, see http://www.bizcomps.com.
What industries are included in the report?
A complete list of the industries included is presented below:
SIC 0181 Landscape and Plant Nurseries
SIC 0740 Veterinary Services
SIC 0752 Pet Grooming and Boarding Kennels
SIC 0782 Landscape and Lawncare Services
SIC 0783 Tree Trimming, Installation, and Removal Services
SIC 1520 Residential Construction and Remodeling Contractors
SIC 1541 General Building Contractors - Nonresidential
SIC 1542 Fire and Flood Restoration Contractors
SIC 1611 Paving Contractors
SIC 1623 Utilities Contractors
SIC 1711 Plumbing, Heating, and Air Conditioning Contractors
SIC 1721 Painting Contractors
SIC 1731 Electrical Contractors
SIC 1742 Drywall, Plastic, Acoustical, and Insulation Contractors
SIC 1743 Tile and Marble Contractors
SIC 1752 Commercial Flooring Contractors
SIC 1761 Roofing, Siding, and Sheet Metal Contractors
SIC 1771 Concrete Contractors
SIC 1791 Structural Steel Contractors
SIC 1793 Window and Door Contractors
SIC 1794 Excavation and Site Preparation Contractors
SIC 1799 Fencing Contractors
SIC 1799 Swimming Pool Contractors
SIC 2050 Wholesale and Commercial Bakeries
SIC 2097 Ice and Ice Products Manufacturers
SIC 2394 Awnings, Tents, and Other Canvas Products Manufacturers
SIC 2395 Embroidery Services
SIC 2396 Silk Screen Printers
SIC 2434 Wood Kitchen Cabinet Manufacturers
SIC 2500 Furniture Manufacturers
SIC 2700 Book, Magazine, and Newspaper Publishers
SIC 2752 Commercial Printers
SIC 2819 Chemical Manufacturers
SIC 3080 Plastics Products Manufacturers
SIC 3270 Ready-Mix and Concrete Products Manufacturers
SIC 3281 Cultured Marble Products Manufacturers
SIC 3441 Structural Metal Fabricators
SIC 3444 Sheet Metal Fabricators
SIC 3470 Metal Plating and Finishing
SIC 3544 Tool and Die Shops
SIC 3585 HVAC and Refrigeration Equipment Manufacturers
SIC 3599 Machine Shops
SIC 3672 Printed Circuit Board Manufacturers
SIC 3714 Auto Parts and Accessories Manufacturers
SIC 3993 Sign Manufacturers
SIC 4119 Limousine Services
SIC 4119 Medical Transportation Services
SIC 4200 Moving and Storage Services
SIC 4212 Local Trucking, Courier, and Delivery Services
SIC 4212 Waste Disposal, Garbage Collection, and Trash Removal
SIC 4213 Long Distance Trucking Services
SIC 4213 Vehicle Transport Services
SIC 4724 Travel Agencies
SIC 4731 Freight Forwarders and Brokers
SIC 4959 Parking Lot Sweeping Services
SIC 5013 Auto Parts and Accessories Distributors
SIC 5031 Door, Window, Cabinet, and Millwork Distributors
SIC 5044 Office Equipment Distributors
SIC 5046 Food Service Equipment and Supplies Distributors
SIC 5047 Medical Equipment and Supplies Distributors
SIC 5063 Electrical Supplies Distributors
SIC 5065 Electronic Parts and Equipment Distributors
SIC 5085 Industrial Equipment and Supplies Distributors
SIC 5087 Cleaning and Maintenance Supplies Distributors
SIC 5088 Golf Cart Distributors
SIC 5093 Scrap and Waste Material Recyclers and Processors
SIC 5099 Fire Extinguishers and Supplies Distributors
SIC 5113 Paper and Packaging Distributors
SIC 5140 Food Distributors, Wholesalers, and Brokers
SIC 5170 Oil, Fuel, and Gas Distributors
SIC 5193 Flowers and Nursery Plants Distributors
SIC 5199 Advertising Specialties Distributors
SIC 5210 Building Supplies Stores and Home Centers
SIC 5211 Garage Door Dealers and Retailers
SIC 5231 Paint and Wallpaper Stores
SIC 5231 Glass Stores and Shops
SIC 5251 Hardware Stores
SIC 5261 Lawn and Garden Centers
SIC 5300 Retail Variety Stores
SIC 5411 Convenience Stores
SIC 5411 Grocery Stores and Supermarkets
SIC 5421 Meat Markets
SIC 5421 Fish Markets
SIC 5441 Candy, Nut, and Confectionary Stores
SIC 5461 Bakeries and Bakery Shops
SIC 5462 Donut Shops
SIC 5499 Water Stores
SIC 5499 Health Food, Vitamin, and Supplement Stores
SIC 5521 Used Car Dealers
SIC 5531 Auto and Truck Parts and Accessories Stores
SIC 5531 Tire Dealers
SIC 5541 Gasoline Service Stations and Minimarts
SIC 5551 Boat, Watercraft, and Marine Supply Dealers
SIC 5561 Recreational Vehicle Dealers
SIC 5571 Motorcycle Dealers
SIC 5600 Clothing Stores
SIC 5661 Shoe Stores
SIC 5699 Uniform Stores
SIC 5712 Furniture Stores
SIC 5722 Household Appliance Stores
SIC 5713 Carpet and Floor Covering Stores
SIC 5714 Drapery and Curtain Stores
SIC 5734 Computer and Electronics Stores
SIC 5812 Restaurants, Sandwich Shops, and Cafes
SIC 5812 Coffee Shops and Coffeehouses
SIC 5812 Food Caterers and Catering Services
SIC 5813 Bars, Taverns, and Nightclubs
SIC 5912 Pharmacies and Drug Stores
SIC 5921 Liquor Stores
SIC 5941 Bicycle Shops and Bike Stores
SIC 5941 Sporting Goods Stores
SIC 5942 Bookstores
SIC 5943 Office Supplies Stores
SIC 5945 Hobby, Arts, and Craft Stores
SIC 5947 Card and Gift Shops
SIC 5961 Catalog and Mail Order Businesses
SIC 5962 Vending Machine Operators
SIC 5963 Newspaper Delivery Service
SIC 5992 Florists and Flower Shops
SIC 5993 Tobacco Shops
SIC 5994 Newsstands
SIC 5995 Optical Stores
SIC 5999 Cell Phone Stores
SIC 5999 Pet Stores
SIC 5999 Picture Frame Shops
SIC 5999 Commercial Art Galleries
SIC 5999 Cosmetics and Beauty Supplies Stores
SIC 5999 Pool Supplies Stores
SIC 5999 Hearing Aid Stores
SIC 5999 Trophy, Plaque, and Award Stores
SIC 6361 Title Insurance Services
SIC 6411 Insurance Agencies
SIC 6500 Property Management and Operators
SIC 6531 Real Estate Agents and Brokers
SIC 7211 Commercial Laundries
SIC 7213 Linen Rental Service
SIC 7215 Coin-Operated Laundries
SIC 7216 Dry Cleaners
SIC 7217 Carpet Cleaning
SIC 7221 Photographers and Photography Studios
SIC 7230 Hair Salons, Beauty Salons, and Barber Shops
SIC 7299 Dating Services
SIC 7299 Tanning Salons
SIC 7311 Advertising Agencies
SIC 7331 Direct Mail Marketing and Advertising Services
SIC 7334 Photocopying and Duplicating Services
SIC 7336 Commercial Art and Graphic Design Services
SIC 7338 Medical Billing Services
SIC 7338 Secretarial and Transcription Services
SIC 7342 Pest Control Services
SIC 7349 Cleaning and Maintenance Services
SIC 7359 Equipment and Tool Rental Stores
SIC 7359 Party and Event Rentals
SIC 7360 Employment and Temporary Help Agencies
SIC 7371 Computer Repair and Service
SIC 7372 Software Companies
SIC 7379 Internet Service Providers
SIC 7381 Security Services
SIC 7384 Photofinishing Laboratories
SIC 7389 Home Inspection Services
SIC 7389 Interior Designers
SIC 7389 Pool Cleaning Services
SIC 7389 Packing and Shipping Services
SIC 7389 Conventions, Meetings, Trade Show Services
SIC 7389 Mail Box Rental and Shipping Services
SIC 7389 Courier and Messenger Services
SIC 7532 Automobile Body Shops
SIC 7533 Auto Muffler Shops
SIC 7537 Auto Transmission Repair Shops
SIC 7538 Automobile Repair Shops
SIC 7542 Car Washes and Auto Detailing Services
SIC 7549 Tow Truck and Towing Services
SIC 7549 Oil Change and Fast Lube Services
SIC 7549 Auto Window Tinting Services
SIC 7641 Upholstery and Furniture Restoration Services
SIC 7699 Appliance Repair Services
SIC 7699 Lawnmower Repair Shops
SIC 7699 Locksmith Services
SIC 7699 Tool and Blade Sharpening Services
SIC 7699 Welding Services
SIC 7812 Video Production
SIC 7841 Video Rental Stores
SIC 7991 Physical Fitness, Health, and Racquet Club Facilities
SIC 7991 Day Spas and Salons
SIC 7993 Amusement Arcades
SIC 7999 Boat and Jet Ski Rentals
SIC 8011 Medical Practices
SIC 8041 Chiropractic Practices
SIC 8051 Nursing Care and Assisted Living Facilities and Services
SIC 8072 Dental Laboratories
SIC 8082 Home Health Care Services
SIC 8249 Technical and Trade Schools
SIC 8351 Child Day Care Centers
SIC 8711 Engineering Services
SIC 8712 Architectural Services
SIC 8721 Accounting, Auditing, Tax, and Bookkeeping Services
How can I order the report?
This report can be purchased online from
BizMiner.com
for $79.00. Upon receipt of your payment, you will receive instructions on how to
access this document online as a .pdf file. You must have Adobe Reader software
installed to open and read the .pdf file. A free copy of the Adobe Reader software can be downloaded at
http://www.adobe.com.
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