Understanding Seller’s Discretionary Earnings when Buying a Small Business

know your company's market value

Net income may vary significantly from SDE By Dave Driscoll Seller’s discretionary earnings (SDE) – also known as seller’s discretionary income – may be a new term for those considering buying a business. Understanding what the term means and how it’s calculated is important when analyzing what the business makes compared to what the business […]

Business Owners: you can’t sell value that you can’t prove!

Metro Business Advisors helps Small Business Owners

Business valuations are based on historical earnings. If the business shows no earnings, the business is not worth much more than the liquidation value of its assets, so maintaining accurate records to reconstruct the business’ cash flow is critical to maximize the eventual selling price.

What Are SDE and EBITDA? What’s The Difference?

St. Louis Small Business Monthly

What is my business worth? This is a common question from small-business owners considering selling a business. The basis of all business valuations revolves around two terms: SDE and EBITDA. SDE = seller’s discretionary earnings EBITDA= earnings before interest, taxes, depreciation and amortization How are SDE and EBITDA calculated, and what is the difference? SDE […]

What Are SDE and EBITDA? What's The Difference?

St. Louis Small Business Monthly

What is my business worth? This is a common question from small-business owners considering selling a business. The basis of all business valuations revolves around two terms: SDE and EBITDA. SDE = seller’s discretionary earnings EBITDA= earnings before interest, taxes, depreciation and amortization How are SDE and EBITDA calculated, and what is the difference? SDE […]

What are SDE and EBITDA? What’s the difference?

What is my business worth? This is a common question from small-business owners considering selling a business. The basis of all business valuations revolves around two terms: SDE and EBITDA. SDE = seller’s discretionary earnings EBITDA= earnings before interest, taxes, depreciation and amortization How are SDE and EBITDA calculated, and what is the difference? SDE […]

What are SDE and EBITDA? What's the difference?

What is my business worth? This is a common question from small-business owners considering selling a business. The basis of all business valuations revolves around two terms: SDE and EBITDA. SDE = seller’s discretionary earnings EBITDA= earnings before interest, taxes, depreciation and amortization How are SDE and EBITDA calculated, and what is the difference? SDE […]