What Is a Restaurant Worth?
Most independent restaurants sell for 1.5x to 3x SDE in 2026, with location, brand strength, and lease terms determining where you land in that range.
Most independent restaurants sell for 1.5x to 3x Seller's Discretionary Earnings (SDE), which works out to roughly 25% to 40% of trailing-twelve-month revenue. A profitable single-unit casual restaurant earning $200,000 in SDE typically sells for $300,000 to $600,000. Multi-unit operators, franchised concepts, and locations with long-term favorable leases earn higher multiples.
What a Restaurant Is Actually Worth
A restaurant's value comes down to two numbers: Seller's Discretionary Earnings (SDE) and the multiple a buyer will pay on top of it. Most independent restaurants in 2026 trade between 1.5x and 3x SDE. That means a single-unit casual concept earning $200,000 in SDE typically sells for $300,000 to $600,000. A three-unit fast-casual group throwing off $750,000 in EBITDA can fetch 4x to 5x — closer to $3M to $3.75M.
Revenue alone tells you very little. A restaurant doing $1.2M at 8% net margin is worth far less than one doing $900K at 18%. For a step-by-step on how earnings get adjusted for owner perks and one-time costs, read our guide on Seller's Discretionary Earnings, then run a baseline estimate using the YourExitValue business valuation calculator.
Why Restaurant Multiples Vary So Much
Restaurants trade across a wide range because cash flow risk varies enormously between operations. Buyers weight the following factors most heavily:
- Lease terms. A 10+ year lease with options at below-market rent can add 0.5x to the multiple. A month-to-month lease can cut value in half.
- Owner dependency. An owner-operator who runs the line, does the books, and personally holds the alcohol license is a discount, not a premium. See why owner dependency hurts value.
- Concept and brand. Franchised QSR units sell at 3x to 5x SDE. Independent fine dining often trades at 1x to 2x because cuisine trends carry buyer risk.
- Equipment age and condition. A buyer staring at $150,000 of imminent equipment replacement will deduct that dollar-for-dollar from the offer.
- Liquor license. In control states like Pennsylvania, Utah, or parts of Florida, a transferable liquor license alone can carry $100,000 to $400,000 of standalone value.
How to Use This Number
Do not anchor on a multiple. Anchor on your specific SDE and a defensible multiple range. Here is what we tell every restaurant owner walking into a sale process:
- Calculate trailing-12-month SDE with documented add-backs — owner salary, personal vehicle, family on payroll, one-time legal fees, and non-recurring repairs.
- Pull three to five comparable sales in your concept and region. BizBuySell, Restaurant Brokers, and your local M&A advisor's comp set are the starting point.
- Apply the right multiple band: 1.5x–2.0x for owner-operator independents, 2.0x–3.0x for absentee or systematized independents, 3.0x–5.0x for franchised units or multi-unit groups.
- Subtract working capital adjustments and any deferred maintenance from the gross enterprise value.
For the full mechanics — what a buyer's quality-of-earnings analyst will actually do to your P&L — see our companion post on how to value a restaurant in 2026.
Buyers — whether private equity rollups, multi-unit operators, or first-time individual buyers — all run the same math. Their offer is a multiple of your SDE minus their perception of risk. Your job between now and a sale is to grow SDE and reduce that risk. Ready to put a real number on your restaurant? Run the restaurant valuation tool at YourExitValue and you will have a defensible value range in under five minutes.
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Key Takeaways
- ✦Most independent restaurants sell for 1.5x to 3x SDE in 2026, or roughly 25%-40% of trailing revenue.
- ✦ A single-unit casual restaurant earning $200,000 in SDE typically sells for $300,000-$600,000.
- ✦ Franchised QSR units trade at 3x-5x SDE; multi-unit groups at 4x-6x EBITDA.
- ✦ A 10+ year lease with options can add 0.5x to the multiple; month-to-month leases can cut value in half.
- ✦ Owner dependency drops the multiple by 0.5x-1.0x; a 3+ year tenured general manager protects value.
- ✦ In quota-license states, a transferable liquor license alone can carry $100,000-$400,000 of standalone value.
Frequently Asked Questions
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