How to Value a Janitorial Business
Valuing a janitorial business requires understanding which method applies to your size, buyer type, and revenue quality. This guide covers the three primary valuation methods used in janitorial M&A transactions and what actually moves your number.
SDE Multiple Range
2.5x–4.5x
EBITDA Multiple Range
3.5x–7x
Average SDE Multiple
3.2x
Avg. Time to Close
90–150 days
The SDE Method (Primary for Businesses Under $5M Revenue)
Seller Discretionary Earnings (SDE) is the foundation of janitorial business valuation. SDE = Net Income + Interest + Taxes + Depreciation + Amortization + Owner Add-Backs. Buyers then apply a multiple to arrive at enterprise value. Janitorial businesses currently sell for 2.5x–4.5x SDE, with most transactions in the 3.2x range. Higher multiples go to businesses with recurring revenue, low owner dependency, and strong growth.
The EBITDA Method (For Larger or PE-Targeted Businesses)
For janitorial businesses above $3–5M in revenue or those targeting PE buyers, EBITDA multiples are the standard. Current janitorial EBITDA multiples range from 3.5x–7x. PE platforms pay at the higher end when acquiring add-ons that fit their existing portfolio.
Key Value Drivers
The factors that push a janitorial business from 2.5x to 4.5x SDE: (1) Recurring revenue percentage — maintenance contract mix above 40% commands a premium, (2) Owner hours — businesses running without daily owner involvement get 0.5x–1.0x more, (3) Revenue trend — growing 10%+ per year vs. flat or declining, (4) Customer concentration — no single customer above 20% of revenue, (5) Management team depth.
What Your Financials Need to Show
To command top multiples, your janitorial business needs 2–3 years of clean P&L statements, properly categorized owner add-backs, documented recurring revenue, and ideally a field service management system with clean job records. Buyers are willing to pay more when the story is clear and the numbers are verifiable.
Janitorial Business Valuation Multiples (2025)
| Method | Low | Mid (Typical) | High (Premium) |
|---|---|---|---|
| SDE Multiple | 2.5x | 3.2x | 4.5x |
| EBITDA Multiple | 3.5x | 4.8x | 7x |
| Revenue Multiple | 0.35x | 0.6x | 0.9x |
Source: BizBuySell, IBBA, Pepperdine Private Capital Markets Report, DealStats (2024–2025)
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