How do I calculate what my manufacturing business is worth?

Normalize your earnings (SDE or EBITDA), then apply a market multiple for your size and sector. The sections above walk through each step.

What's a typical multiple for an Ontario manufacturer?

It varies widely by size, sector, and owner-dependence. A conversation or a valuation report will narrow it to your specific situation. This page is educational, not a quote.

Should I get a formal valuation before selling?

It helps you decide and negotiate, but a direct conversation with a credible buyer can give you a realistic range at no cost and without the commitment of a formal process.

WHAT IS MY BUSINESS WORTH

What is my Ontario manufacturing business worth?

The two numbers that decide value

Almost every valuation reduces to earnings × multiple. Owners fixate on the multiple, but the bigger lever is usually the earnings figure — specifically how it's normalized: stripping out owner perks, one-time items, and paying a market wage for your own role. Get that number clean and defensible first.

SDE vs EBITDA — which applies to you

For smaller operations, buyers look at Seller's Discretionary Earnings: net income plus your salary, perks, and non-essential expenses added back. For larger deals, the standard is EBITDA — earnings before interest, tax, depreciation and amortization — times a multiple drawn from comparable Ontario sales.

What raises (and lowers) your multiple

Higher: low customer concentration, repeat or recurring revenue, a management team that runs the floor without you, documented processes, well-maintained equipment, a defensible niche, clean financials. Lower: heavy dependence on the owner, one customer that's 40% of sales, undocumented "it's all in my head" operations, deferred maintenance, lumpy earnings.

The three approaches, plainly

Asset-based: net value of equipment and assets — a floor, common for asset-heavy manufacturers. Income-based: future earning power, e.g. discounted cash flow — for stable, predictable businesses. Market-based: what comparable Ontario businesses actually sold for — often the most realistic, when comparables exist.

A number isn't the same as the right buyer

A broker will happily give you a valuation to win the listing — then shop you to the highest bidder. We'll walk you through the same math as the buyer, free and without obligation, so you understand your range before you decide anything. The right outcome balances the number against who ends up with your life's work.

Per the CFIB, roughly 76% of Canadian small-business owners plan to exit within the decade, yet only ~9% have a formal succession plan — and as more businesses come to market, valuations can compress for owners who wait. Planning early protects your number.

Source: CFIB (Canadian Federation of Independent Business), January 2023

Frequently asked questions

: Normalize your earnings (SDE or EBITDA), then apply a market multiple for your size and sector. The sections above walk through each step.
: It varies widely by size, sector, and owner-dependence. A conversation or a valuation report will narrow it to your specific situation. This page is educational, not a quote.
: It helps you decide and negotiate, but a direct conversation with a credible buyer can give you a realistic range at no cost and without the commitment of a formal process.

Ready when you are.

Understand your range before you decide anything.

Get a confidential valuation conversation →