How to Calculate the Value of Your Café
A practical guide for owners preparing to sell in 2025
If you are a café owner wondering what your business might be worth, you’re not alone. Many small business owners either over or underestimate their value because they don’t use the right framework. At Unbroker, we help café and restaurant owners price their businesses using real market data—not guesswork.
This guide outlines a step-by-step approach to estimating what your café is likely worth using industry-standard valuation methods and real-world examples from our deal data.
Step 1: Understand the Metric That Matters Most — SDE
SDE stands for Seller’s Discretionary Earnings. It’s the amount of profit a new owner could expect to earn if they operated the business full-time.
SDE is calculated as follows:
Net Profit + Owner Salary + One-Time Expenses + Personal Expenses Run Through the Business = SDE
Example: If your café made $60,000 in net profit, and you also paid yourself a $70,000 salary, with another $10,000 in one-time expenses, your total SDE would be $140,000.
Step 2: Identify Your Revenue and Profit Trends
Buyers want consistency. Gather financials for the last three years, if possible. You’ll need your gross revenue and SDE for each year. Flat or steadily growing numbers build confidence. Declining or erratic financials may lower your valuation.
Use clean, verifiable data from your tax returns or accountant.
Step 3: Apply Realistic Valuation Multiples
Based on our analysis of numerous recent brunch and café listings:
- Average multiple of SDE: 2.06x
- Average multiple of revenue: 0.44x
In practice:
If your SDE is $150,000 and your café is well-run with consistent numbers, a reasonable valuation would be:
$150,000 × 2.06 = $309,000
This is your estimated market value.
Revenue multiples are best used as a sanity check. If your café generates $700,000 in revenue:
$700,000 × 0.44 = $308,000
If both methods lead to similar numbers, your valuation is likely grounded.
Step 4: Adjust Based on Business Strengths or Risks
Buyers often adjust valuation up or down based on qualitative factors. Ask yourself:
- Do you have a strong lease in place?
- Does the business run well without your daily involvement?
- Are your books clean and easy to read?
- Do you have consistent positive reviews and customer loyalty?
Each of these elements can increase buyer confidence and push your multiple higher.
On the other hand, if the business is highly dependent on you, has unpredictable sales, or messy financials, expect a lower multiple than average.
Step 5: Consider the Buyer Pool
Most buyers for café businesses fall into one of three categories:
- Individual owner-operators looking for a lifestyle or career change
- ETA buyers using SBA loans to acquire a stable business
- Strategic buyers expanding an existing café group
Understanding your buyer type helps you frame your value appropriately. For example, SBA-eligible businesses often command higher prices because financing is more accessible.
Step 6: Benchmark Against Real Listings
Look at actual listings in your market or category. Here’s an example from Unbroker’s data:
- Asking Price: $425,000
- Revenue: $950,000
- SDE: $210,000
- Valuation: 2.02x SDE, 0.45x revenue
This café had limited owner involvement, clean financials, and a strong lease. Your business will trade similarly if it matches those characteristics.
Final Word
Unbroker helps you get the right valuation by using real market data, not guesswork. We calculate your Seller’s Discretionary Earnings (SDE), apply the right industry multiples, and factor in strengths like recurring revenue or risks like owner dependency. You’ll receive a clear, customized FairValue Report™ showing what your business is worth—and why—so you can sell with confidence.
To get started, reach out to Unbroker for a free, no-obligation estimate. We’ll help you understand where you stand and what steps to take next.
