Seller's discretionary earnings is net profit plus the owner's salary, benefits, and one time or personal expenses added back. Buyers and SBA lenders value small businesses as a multiple of SDE.

Why do add backs matter so much?

Add backs you cannot document reduce what your business is worth. If your tax returns do not support the earnings you are claiming, an SBA lender will not fund the deal at that number.

How do I find out what my business is worth?

Get a free confidential valuation. It uses SDE and real market comps from completed Utah sales, and there is no obligation.

What Is My Utah Business Worth? SDE Multiples and Valuation Guide for 2026

Q: What is my Utah business worth?

Most Utah small businesses sell for a multiple of seller's discretionary earnings. Trades and retail typically run 2 to 4 times, while medical billing can reach 4 to 10 times depending on specialty, recurring revenue, and whether the business runs without the owner.

Cameron DuPree

Jul 29

4 min read

Updated: Aug 22

The short answer

Most main street businesses in Utah sell for between 2 and 3.5 times their Seller's Discretionary Earnings (SDE). Across all industries nationally, the median is about 2.6x SDE, or roughly 0.67x annual revenue, and the median small business sale price reached about $375,000 at the end of 2025. Where your company lands inside that range depends on your industry, how dependent the business is on you personally, and how clean your financials are.

That range sounds wide because it is. The difference between a 2.2x business and a 3.2x business on $400,000 of SDE is $400,000 of your retirement. This guide explains how the math works and what moves your number up or down.

What SDE actually means

Seller's Discretionary Earnings is the total financial benefit a single owner-operator takes out of the business each year. It starts with net profit, then adds back your salary, payroll taxes on that salary, personal perks run through the business, interest, depreciation, and any one-time expenses that a new owner would not inherit.

An example: a Lehi HVAC company shows $150,000 in net profit. The owner also pays herself a $90,000 salary and runs a $10,000 truck lease through the books that is really a personal vehicle. Her SDE is roughly $250,000. At a 2.75x multiple, the business is worth around $687,000, not the $412,000 a 2.75x on net profit alone would suggest. Getting the add-backs right is often worth six figures.

2026 valuation multiples by industry

These are the current national medians from completed small business sales (BizBuySell market data through Q4 2025). Utah deals track these ranges closely, with strong buyer demand along the Wasatch Front often pushing well-run companies toward the top of their range.

Service businesses: about 2.6x SDE (0.82x revenue). Restaurants and food service: about 2.2x SDE (0.42x revenue). Retail: about 2.6x SDE (0.54x revenue). Manufacturing: about 3.0x SDE (0.73x revenue). Building, construction and trades: about 2.6x SDE (0.58x revenue).

Larger companies earn higher multiples. Once earnings pass roughly $700,000 to $1 million, buyers shift from individuals to private equity and strategic acquirers, pricing moves to EBITDA multiples, and 4x to 6x becomes realistic. This is one reason growing from $600,000 to $900,000 of earnings can nearly double your sale price rather than just adding 50 percent.

What pushes your multiple up or down

Buyers along the Wasatch Front pay premiums for the same handful of things. A business that runs without the owner in the middle of every decision. Three years of clean, consistent books that match your tax returns. A customer base where no single client is more than 15 to 20 percent of revenue. Recurring or repeat revenue. A transferable lease or owned real estate in Salt Lake County or Utah County's tight commercial market. A trained second-in-command who is staying.

The discounts are the mirror image: owner dependence, declining revenue, messy or cash-heavy books, customer concentration, and month-to-month leases. Most of these are fixable in 12 to 24 months, which is why the best time to get a valuation is one to two years before you plan to sell, not the month you decide.

When you need a certified valuation instead of an estimate

A broker's opinion of value is the right tool when you are deciding whether to sell. But some situations require a formal, defensible valuation prepared to professional standards, because a bank, a court, or the IRS will be reading it. Those include SBA loan applications, partner buyouts and buy-sell agreements, divorce, estate and gift planning, converting to an ESOP, and shareholder disputes.

Zion Business Brokers provides both. If you are thinking about selling, we prepare a confidential market valuation at no cost as part of our listing process. If you need a certified, standards-compliant valuation or a USPAP-compliant machinery and equipment appraisal for a lender, attorney, or the IRS, we provide those as a standalone professional service with a formal written report.

What your number looks like in practice

Take a Utah County service business with $300,000 of SDE. At the service-sector median of 2.6x, that is roughly $780,000. Reduce owner dependence and lock in a key employee, and 3x or more is achievable, which is another $120,000 at closing. Let the books get messy or lose a major customer, and 2.2x means giving up more than $100,000. The multiple is not a lottery number. It is a scorecard you can improve while you are still in control.

Get your real number

If you are one to three years from selling, the single most valuable step is knowing your number now, while there is still time to improve it. Request a free, confidential valuation consultation at www.zionbusinessbrokers.com/free-business-valuation or call 385-985-7216. If you need a certified valuation or equipment appraisal for financing, legal, or planning purposes, ask about our formal valuation services. Every conversation is confidential.

Industry-specific SDE multiples: HVAC, plumbing, and electrical · roofing · landscaping · window cleaning · medical billing · retail stores

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Want a number right now? Try the free Utah business valuation calculator and get a market value range in 30 seconds, based on real multiples from completed sales. No sign-up required.

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Run your own numbers with the business valuation calculator. If equipment makes up a large share of the value, a machinery and equipment appraisal will matter to your buyer's lender.

Multiples vary sharply by sector. Two useful ends of the range: restaurants, which usually price below the market average and where the lease is often the real asset, and plumbing and electrical contractors, which price above it when service revenue dominates.

Updated figures now live in the Utah Business Sale Index, our twice-yearly record of observed multiples by industry and time to close.