To use this calculator, input your restaurant's annual revenue, net profit, and other financial details. Adjust the valuation multiple to see how it affects the estimated business value. The calculator will provide a business valuation, Seller's Discretionary Earnings (SDE), and a minimum value based on your inputs.
The primary formula used is: Valuation = SDE * Multiple, where SDE is calculated as net profit plus owner's salary, depreciation, interest, and non-recurring expenses.
Consider a restaurant with $1,000,000 in annual revenue, $100,000 in net profit, and a valuation multiple of 2. The SDE would be calculated by adding back any owner's salary, depreciation, interest, and non-recurring expenses to the net profit. The business valuation would then be the SDE multiplied by 2.
When valuing a restaurant, consider market conditions, competition, and growth potential. Use this calculator as a guide, but consult with a financial advisor for a comprehensive valuation. For more insights, explore our ROI Calculator and Profit Margin Calculator.