SDE Calculator for Amazon FBA Businesses
Calculate your Seller's Discretionary Earnings and get an estimated valuation range for your Amazon FBA business.
Calculate Your SDE
SDE Breakdown
Estimated Valuation Range
Based on typical Amazon FBA multiples of 2.5x–4.0x annual SDE.
What is Seller's Discretionary Earnings (SDE)?
SDE represents the total financial benefit a single owner-operator derives from a business. It starts with net profit and adds back expenses that are either personal, one-time, or non-cash in nature. SDE is the standard metric used to value small and medium-sized businesses.
For Amazon FBA businesses, SDE is particularly important because many owners run lean operations with significant personal expenses flowing through the business. Based on 500+ FBA business acquisitions, typical Amazon FBA businesses sell for 2.5–4.0x annual SDE.
How to Calculate SDE
SDE = Net Profit + Owner Salary + One-Time Expenses + Personal Expenses + Depreciation + Amortization + Interest + Non-Cash Expenses
Example: Your Amazon FBA business shows $80,000 net profit. You pay yourself a $60,000 salary, had a $5,000 one-time legal fee, run $3,000/year in personal travel through the business, and have $2,000 in depreciation. Your SDE would be $80,000 + $60,000 + $5,000 + $3,000 + $2,000 = $150,000. At a 3.0x multiple, the estimated business value would be $450,000.
Understanding Your Results
Your SDE multiple depends on several factors: revenue size, growth trajectory, product diversification, brand strength, and operational complexity. Businesses with higher revenue, strong growth, and diversified product lines typically command multiples toward the higher end.
This calculator provides a rough estimate. For a detailed valuation that accounts for all the factors unique to your business, use our free valuation tool below.
Frequently Asked Questions
Add-backs are expenses that would not continue under new ownership or that are non-cash in nature. Common examples include the owner's salary, personal travel or meals charged to the business, one-time legal fees, depreciation, amortization, and interest on debt the buyer won't assume.
Net profit is your bottom line after all expenses. SDE adds back the owner's compensation and discretionary expenses to show the total economic benefit available to a new owner-operator. SDE is almost always higher than net profit because it includes those add-backs.
Most Amazon FBA businesses sell for 2.5x to 4.0x annual SDE. The exact multiple depends on factors like annual revenue, growth rate, product diversification, brand registration, supply chain stability, and how much owner involvement is required.
SDE is the standard metric buyers and brokers use to value small and medium-sized businesses. A higher SDE directly translates to a higher sale price. Understanding your SDE helps you identify which expenses to optimize before going to market.
Yes. FBA-specific add-backs often include personal Amazon purchases on the business account, one-time product launch costs, experimental ad spend for products you discontinued, trade show travel, and software subscriptions used partially for personal purposes.
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