Australia guides

What multiple of profit do small businesses sell for in Australia?

There is no measured, public figure for the multiple Australian small businesses sell at, because private sale prices are not recorded anywhere the public can see. What exists is adviser-published ranges. Those put owner-operated businesses under about A$1 million of earnings at roughly 1.5 to 4 times normalised earnings depending on size, with hospitality and retail at the low end and healthcare, professional services and technology towards the top. Which profit you multiply — net profit, EBITDA or an owner-adjusted figure — moves the answer as much as the multiple does, so never quote one without the other.

By the bizflip team · Published 3 September 2026 · Facts checked 3 September 2026 · Sources listed below

Nobody in Australia measures the multiple small businesses sell for. Private sales are contracts between private parties, no register records the price, and the one substantial database of completed sales is not open to the public. What circulates instead is a set of ranges published by advisers and brokers, built from their own deals and their reading of the market. Those ranges are worth knowing. They are also narrower in their own terms than they look once you notice that each one is measuring a different kind of business on a different definition of profit. This page sets out what is published, what each range actually covers, and how to use them without misleading yourself.

Why there is no single answer

Australian advisers say this themselves. creditte notes that there is no comprehensive public database of Australian SME transaction multiples equivalent to those available in the US market, and describes its own ranges as indicative and based on market observation. Oliver Group, which publishes a table by size band, states that Australian private transaction data is incomplete, self-reported and lags the market by months, that it widened its ranges where the evidence was thin rather than present false precision, and that its table calibrates expectations rather than evidencing a value. The nearest thing to a transaction record, the Australian Institute of Business Brokers' Bizstats database, is described by the institute as Australia's largest database of completed business sales and is exclusive to its members. Our guide on free data on Australian sale multiples covers what the ABS, ATO and ASIC do and do not collect.

Which profit? The multiple means nothing without its earnings basis

The word profit hides three different numbers, and the multiple that applies to each is different.

• Net profit is total gross profit minus all business expenses, the bottom line on the accounts. It is after the owner's wage, after interest and after depreciation, and it is the figure business.gov.au's return-on-investment method works from.
• EBITDA — earnings before interest, tax, depreciation and amortisation — strips out financing and non-cash items. For a small business it should also have a market wage for the owner's role deducted, because a buyer who does not want to work in the business will have to pay someone to.
• Seller's discretionary earnings (SDE), and the Australian variant usually called PEBITDA, add one owner-operator's wage and personal benefits back on top. Wall Street Prep describes SDE as the normalised operating profitability of small to mid-sized businesses, with adjustments to the owner's salary and discretionary personal spending that EBITDA does not make, and notes it is used mainly for smaller companies.

Because an owner-inclusive figure is larger than EBITDA, the multiple applied to it is lower. Quote a broker's EBITDA multiple against your own PEBITDA and you have overstated the business, sometimes by a full year's earnings. Our SDE versus EBITDA guide sets out the arithmetic; fix the basis before you read any range below.

What Australian advisers publish

The table quotes each source on its own terms, including what it says the range covers. Read the third column before the second.

Put side by side, the pattern is clearer than any single row. The same industry label carries a multiple of two at one adviser and nine at another, and the difference is almost entirely what size of business each is describing. creditte's micro band and Lyndon's mid-market band are not in disagreement; they are describing different markets. Oliver Group makes the point directly, noting that businesses above A$5 million of EBITDA increasingly attract private equity and strategic acquirers and trade on different evidence. Our multiples by industry guide quotes a further Australian valuer's sector bands line by line if you want a second set to compare.

Why the ranges differ so much

• Size. Across every source, the multiple rises with the earnings figure. A business earning A$200,000 is priced as a job with assets attached; a business earning A$2 million is priced as an investment that runs without its owner.
• How the business was sold. Lyndon Advisory reports that a competitive auction consistently achieves 15–25% higher multiples than a bilateral negotiation. That is mid-market evidence, but the direction holds at any size: one interested buyer sets a lower price than three.
• When. Lyndon also notes that Australian EBITDA multiples have compressed from their 2021–22 peak, so a range quoted in an older article may be describing a market that no longer exists.
• Earnings basis. As above, a range built on EBIT, EBITDA or an owner-inclusive figure cannot be applied to a different one.
• What is inside the price. Whether stock, plant and equipment and working capital are included or added on top changes the headline multiple without changing the business.

What moves one business within its range

Three sources give a similar figure for how much the qualities of an individual business shift its multiple. Nash Advisory, whose multiples table is built from historical transactions typically of companies with an enterprise value above A$200 million, says factors such as depth of the management team, geographic coverage, brand recognition, size and scale, and reliability of revenue and earnings can add or detract between 0.5x and 1.5x. Lloyds gives the same 0.5x to 1.5x span and adds location, with major-city businesses attracting higher multiples than rural ones. PieLAB says quality of revenue, owner independence and market defensibility can move a valuation by half to one and a half turns in either direction on the same earnings base. Verus AA lists the drivers that push a multiple up as strong recurring or contracted revenue, low owner dependence, a diversified customer base, documented systems, clean financial records, a growth trajectory and a defensible market position.

The practical implication is that a business at the bottom of its sector's band and one at the top are often the same size in the same trade. The difference is whether the earnings survive the owner leaving, and how easily a buyer can verify them.

How to use this without fooling yourself

• Normalise the last complete financial year first, and write down which earnings basis the result is on.
• If the business sells directly to consumers, check the cost ratios against the ATO's small business benchmarks for your industry and turnover band. The benchmarks produce no multiple, but an implausible profit figure gives a confident wrong answer whatever you multiply it by.
• Pick the two sources above whose scope matches your size and basis, apply the low and high of each, and treat the resulting spread as your working range. Do not average the table.
• Discount any range that describes businesses ten times your size. A multiple from a competitive mid-market process is not evidence about a single-owner business with one interested buyer.
• Check the result against current asking prices for comparable businesses, remembering that an asking price is a ceiling, not a settled price.
• For anything a lender, a partner, a court or the ATO will rely on, engage an accountant or a registered business valuer. business.gov.au recommends professional advice through your accountant, a business adviser or a business broker, and a formal valuation is a different document from any range on this page.

The honest summary is that an Australian small business sells for what a buyer will pay for its earnings after the owner leaves, and the published ranges are the accumulated experience of people who have watched that happen. Use them as a check on a number, never as the number. Our guide to how much a business is worth walks through the method end to end.

Sources

Every load-bearing claim in this guide, and where it comes from:

• The page's 'Sources and methodology note' states: 'There is no comprehensive public database of Australian SME transaction multiples equivalent to those available in the US market. All ranges are indicative and based on market observation.' The body puts it as 'no comprehensive public database covers Australian SME transactions specifically' and 'These are indicative ranges based on general market observation.' Ranges quoted: micro businesses (under $250k EBITDA) 1.5x–2.5x, small businesses ($250k–$1m EBITDA) 2.5x–4x, mid-market ($1m–$5m EBITDA) 3.5x–6x. — creditte
• 'Australian private transaction data is incomplete, self-reported, and lags the market by months, and thin industries produce wide ranges'; 'Where the evidence for a band was thin we widened the range rather than false-precision it'; 'The table calibrates expectations; it does not evidence a value'; businesses above $5m EBITDA 'increasingly attract private equity and strategic acquirers and trade on different evidence'. — Oliver Group
• The AIBB describes Bizstats as 'Australia's Largest Database of Completed Business Sales', 'Exclusive to AIBB Business Broker Members'. — Australian Institute of Business Brokers
• Net profit is 'your total gross profit minus all business expenses. Also known as your bottom line.' — business.gov.au (Australian Government)
• business.gov.au's return on investment method uses 'ROI = (net annual profit/selling price) x 100', and the page recommends professional advice 'through your accountant, a business adviser or a business broker'. — business.gov.au (Australian Government)
• 'Seller's Discretionary Earnings (SDE) measures the normalized, operating profitability of small to mid-sized businesses'; SDE 'includes adjustments to the owner's salary, including the discretionary spending of company funds on personal expenses' which EBITDA does not; SDE is used primarily for smaller companies while EBITDA 'is used to analyze companies of all sizes'. — Wall Street Prep
• Reported Australian sector EBIT multiples: professional services 2.0x–4.0x, trade services 1.5x–3.0x, healthcare/medical 3.0x–6.0x, retail 1.0x–2.5x, technology/SaaS 4.0x–10.0x+, hospitality 1.0x–2.0x, manufacturing 2.0x–4.0x; value drivers include 'strong recurring or contracted revenue, low owner-dependence, diversified customer base, documented systems and processes, clean financial records, growth trajectory, and defensible market position'. — Verus Accountants and Advisors (Verus AA)
• 'For established Australian service businesses, current market reporting puts the typical range somewhere between three and six times normalised EBITDA'; quality of revenue, owner independence and market defensibility can shift valuations by half to one and a half turns in either direction. — PieLAB
• Lloyds publishes EBITDA multiple ranges by sector (financial services 4–6x, retail 2–4x, tourism 3–5x, transport and logistics 3–6x, eCommerce and IT 4–8x, education 3–6x, healthcare 4–8x), says 'Several factors can add or detract between 0.5x to 1.5x on a multiple', and notes major-city locations affect valuations positively while rural locations give a more modest multiple; the page does not disclose the data basis. — Lloyds Corporate Brokers
• Mid-market Australian multiples for '$2M–$50M EBITDA, competitive process, Q1–Q2 2026': SaaS 8–18x, healthcare 6–12x (the page headline; its table splits this into healthcare (dental, diagnostics) 7–12x and healthcare services (GP, allied health) 6–10x), professional services 5–9x, manufacturing 4–7x; 'a competitive auction consistently achieves 15-25% higher multiples than bilateral negotiations'; 'EBITDA multiples in Australia have compressed from 2021-2022 peak levels'. — Lyndon Advisory
• The page notes 'these EBITDA multiples are based on historical transactions, typically of companies with an Enterprise Value of over AUD $200m' (source given as Mergermarket and Nash Advisory analysis), then says factors including 'Depth of the management team', 'Geographic coverage', 'Strong brand recognition in the market', 'Size and scale' and 'Reliability of revenue and earnings (recurring or once-off)' can 'add or detract between 0.5x-1.5x on a multiple for a particular company'. — Nash Advisory
• 'The 2023–24 small business benchmarks help you compare your business's performance against similar businesses in the same industry.' — Australian Taxation Office
• 'Small business benchmarks are currently limited to businesses that supply goods and services directly to consumers.' — Australian Taxation Office

Ready for your own number? The valuation calculator is free and ungated, and its methodology is public.