How to Value Your Business Without Hiring a Broker

March 29, 2024•2 min read

One-sentence takeaway: a few clear numbers—earnings, assets, and realistic market multiples—let you set a fair price range before the first buyer meeting.

1 Normalise your earnings

Remove one-off costs and owner perks from the last full year’s accounts. The corrected profit is your base.

• Salary you paid yourself above market
• Family car or phone put through the company
• Exceptional legal fees or Covid grants

2 Pick the right earnings yardstick

• Turnover under £1 m and owner-managed: use Seller Discretionary Earnings (SDE)
• Turnover £1 m–£10 m with functional managers: use EBITDA

3 Find a market multiple

Ask your accountant for recent deals, scan Companies House filings, and read sector press. For many UK service firms:

• SDE commonly trades at two to four times
• EBITDA often trades at four to six times

Stay conservative for flat growth, stretch higher for strong recurring revenue.

4 Adjust for risk and upside

Add or subtract up to one multiple turn for each factor:

• Customer concentration
• Contracted recurring revenue
• Depth of management team
• Strong or weak cash flow seasonality

5 Check asset coverage

Add together net tangible assets plus surplus cash. This sets a floor below which a rational seller rarely goes.

6 Run sanity checks

• Payback: target buyer recoups cash within four to five years.
• Rule-of-thumb revenue multiple: many small firms change hands at fifty to eighty per cent of annual revenue.
• Debt service: profits after finance must cover any acquisition loan comfortably.

7 Package a three-band price guide

• Floor: asset value or low end of multiple range
• Mid: earnings times midpoint multiple
• Stretch: earnings times high end multiple after positive adjustments

8 Prepare proof for buyers

Gather the last three years of filed accounts, year-to-date management accounts, and a short note on adjustments made. Clean, organised numbers build trust and shorten negotiation.

Next step

Complete the three-band guide above, share only the mid figure as an asking anchor, and keep the floor and stretch numbers for your private negotiating range.

value my business UK

Mark Guy Gerard Camilleri

I’m an SME investor with a background in social housing and over five years of experience working closely with government bodies to provide safe, high-quality housing for vulnerable communities. Through this work, I’ve developed a deep understanding of the essential services that support the housing sector — from pest control to electrical, plumbing, and HVAC services. My current focus is on acquiring and scaling established businesses in these core areas, especially those with strong local reputations and long-standing customer relationships. I’m not a corporate buyer looking to strip away what makes a business special. I take a human, collaborative approach to M&A — whether that means a full exit for the owner, a phased transition, or finding ways to work together post-sale to grow the business. If you’re a business owner thinking about the next chapter, I’d love to have a no-pressure conversation about what that could look like — and whether there’s a way we can align.