Restaurant Valuation Template

Start with the Inputs & Assumptions sheet. You'll need three things: your last two to three years of profit and loss statements, a current equipment list with rough fair market values, and your lease terms — expiration date, monthly rent, and whether it's transferable. Pull your P&L from your accountant or POS system and enter the top-line numbers. Don't use your tax return EBITDA directly; most restaurant owners run personal expenses through the business, and buyers will add those back anyway. The sheet walks you through each normalization item so nothing gets missed.

Restaurants are among the most frequently bought and sold small businesses, but they're also among the hardest to value correctly. The core challenge is that most independent restaurants are deeply owner-dependent — the chef, the relationships with regulars, the supplier terms — and a buyer is essentially paying for future cash flows they'll generate after the current owner leaves. That's why Seller's Discretionary Earnings, not revenue, drives most restaurant valuations. SDE captures what the business actually puts in an owner-operator's pocket each year and normalizes out the personal expenses and below-market owner salaries that make P&Ls misleading.

Key Performance Indicators