Before the owner of an auto repair shop in Illinois came to us, a local advisor had said $750,000 was about the ceiling. The sale would include the building.
We listed the shop at $1,750,000, real estate included. It closed at $1,650,000.
Same shop, same town. The difference was the preparation, how the numbers were presented, and which buyers got to see it.
The numbers
| Business | Auto repair shop, with its real estate |
|---|---|
| Location | Illinois |
| Seller’s discretionary earnings (SDE) | $449,000 |
| First opinion, local advisor | About $750,000 |
| Asking price | $1,750,000, real estate included |
| Seller note | $82,000, about 5% of the price |
| Sold for | $1,650,000 |
The owner received most of the price at closing. The seller note, about 5% of the price, is common in deals of this size: it shows the buyer’s lender that the seller stands behind the business.
Why two opinions can be so far apart
We are not going to pick apart another advisor’s work. But we see the same few reasons again and again when two people look at one business and come back with very different numbers:
- Which earnings are used. The net income on a tax return is not what a buyer pays for. Buyers and lenders price a business this size on seller’s discretionary earnings: profit before the owner’s own pay, plus documented personal and one-time expenses. On the same books, the two figures can be far apart.
- Rules of thumb versus closed deals. A quick multiple from memory is not the same as pricing from what comparable businesses actually closed at, adjusted for size, location and how the business is run.
- How the real estate is handled. A business and the building it operates from are valued differently. A buyer who can own the building as part of the deal often pays for that certainty.
- Who gets to see it. A business shown to one or two local buyers sells at the price those buyers will pay. A business shown, confidentially, to a wide pool of qualified buyers sells at the price the market will pay.
On this sale, every buyer was qualified and signed a confidentiality agreement before learning the name of the shop.
A second opinion cuts both ways
Not every first opinion is low. Our State of Main Street 2026 data shows the opposite problem is more common: owners asked a median 3.5x SDE, while comparable businesses with $1M to $5M in sales closed at a median 2.74x. An honest second opinion is sometimes good news and sometimes a reality check. Either way, it is better to hear it before you go to market than after.
If someone has already told you what your business is worth, a second opinion costs nothing. The free estimate below takes about two minutes, and nobody will know you asked.
Type and state only. We never publish a client’s name, before or after a sale. Figures are published with the seller’s permission. See more on our track record.
General information only. It is not legal, tax or financial advice, and every business is different.