I was wondering if you can share reliable ebitda and sde multiples for the following businesses in the midwest?
* QSR (Ex. Go To Foods, Dairy Queen, tropical smoothie Leased Franchise)
* Gas Station with C-Store (leased vs with real estate)
A few people told me they would only be 3x/3.5x EBITDA for a national QSR chain. Yet when I look at listings people want 5x EBITDA for a leased operation. I don’t have data on where these listings eventually closed.
For Gas Station with real estate, AI has told me 5x EBITDA would be a good deal territory with real estate. But when I look at transactions its really all over the place. But another rule of thumb I've been told is to pay between 0.8x to 1x in store revenue. Another rule of thumb is to pay 3x gross profit. I don't have good connections in this industry but when I offer sellers these numbers they get offended. But my strategy has been cold out reach so I know they may just be fishing for a very high offer to move them.
Among successful entrepreneurs I know they all seem to have paid on the lower end of these multiples I know. Yet when you look at listings the price is higher. I know this is a game of patience, but I don’t have credible data. Just a few examples here and there.