What Is a Coffee Shop Worth?

Most independent coffee shops sell for roughly 1.5x to 2.8x Seller's Discretionary Earnings. A shop with $90,000 of SDE would typically land between $135,000 and $252,000. Lease terms and whether a manager runs the floor move you within that range.

1.5x to 2.8x SDE covers most independents. Shops reach the upper end when they are genuinely manager-run with a strong lease. A shop that depends on the owner being there every morning sits at the bottom, because the buyer is purchasing a job.

It is generally included in the earnings-based price rather than added on top, since the equipment is what produces those earnings. Where it matters is the other direction: machines near end of life reduce the price, because the buyer faces immediate capital spend.

There is no single average, because price tracks earnings rather than revenue. At the midpoint multiple of 2.1x SDE, coffee shops at $500,000 of SDE sell around $1,075,000, and at $1,000,000 of SDE around $2,150,000. Typical SDE margin in this category runs near 10% of revenue, so a coffee shop doing $1,000,000 in revenue would often carry about $100,000 of SDE and land near $215,000.

Take your Seller's Discretionary Earnings and multiply by 1.5x to 2.8x. Where you land inside that band is decided by owner dependence, customer concentration, recurring revenue and the quality of your books. A coffee shop at the top of the range looks materially different from one at the bottom, and most of those differences can be improved in the twelve months before a sale.

SDE multiples of 1.5x to 2.8x apply to owner-operated coffee shops. Once earnings pass roughly $1M to $2M of EBITDA the buyer pool shifts to private equity and strategic acquirers, and pricing restates onto an EBITDA multiple of 4x to 6.5x. The two are not comparable: SDE includes the owner's compensation and EBITDA does not, so the same business shows a higher SDE multiple than EBITDA multiple.

Typically 5 to 10 months from going to market to closing, assuming financials are ready. The lease usually decides the sale. A coffee shop is a location business with equipment in it, and a buyer who cannot inherit your rent and your term is not really buying your business.

SDE times the industry multiple. For coffee shops that multiple is 1.5x to 2.8x, so $250,000 of SDE points to $375,000 to $700,000. Recorded sales of similar businesses serve as a cross-check, and the equipment and inventory value usually sets the floor.

Yes, at the top of this page. It applies the 1.5x to 2.8x band for coffee shops, adjusted for owner hours, margin and years in business, and returns a range rather than one number.

To decide whether to sell a coffee shop, a market valuation: what a buyer would likely pay. A certified appraisal is usually needed only for divorce, estate, tax, litigation or a buyer's SBA loan, and costs far more.