How much does a business broker charge?

Business broker commissions range from 5–12% of the final sale price depending on deal size. Smaller businesses (under $1M) typically pay 10–12%, while mid-market businesses ($1M–$5M) pay 6–10%. Some brokers also charge an upfront retainer of $2,500–$15,000 for CIM preparation, which is usually credited back at closing.

How long does it take to sell a business?

Most small to mid-market business sales take 6–12 months from broker engagement to close. The stages include CIM preparation (4–8 weeks), buyer outreach and qualification (4–12 weeks), due diligence (30–90 days), and closing (2–4 weeks). SBA-financed deals add 30–60 days to the timeline.

What is seller's discretionary earnings (SDE)?

Seller's Discretionary Earnings (SDE) is the standard valuation metric for small businesses. It equals net profit plus owner salary, owner benefits, non-recurring expenses, and depreciation/amortization. SDE represents the total economic benefit to a single owner-operator. Most small businesses sell at 2–4× SDE.

Do I need a business broker to sell my business?

While you can technically sell without a broker, data consistently shows brokered transactions close at 15–25% higher prices and at higher completion rates than unrepresented sales. The exception is if you already have an identified buyer at an agreed price. In any other scenario, professional representation pays for itself many times over.

What is an IBBA-certified business broker?

The International Business Brokers Association (IBBA) is the professional body for business brokers. IBBA-certified brokers hold designations like CBI (Certified Business Intermediary) or M&AMI (Merger & Acquisition Master Intermediary), which require transaction history, continuing education, and adherence to a code of ethics. These certifications signal professional commitment and deal experience.

What is the difference between a business broker and an M&A advisor?

Business brokers typically handle Main Street and lower-middle-market transactions — businesses selling for $100K to $10M. M&A advisors operate in the middle market ($10M to $500M+) with larger teams, investment banking capabilities, and institutional buyer relationships. For businesses under $5M, a CBI-certified business broker is usually the right choice.

How to Sell an E-commerce Business

E-commerce M&A is active and well-developed — aggregators, strategic buyers, and PE-backed platforms are all competing for quality deals. But valuations vary enormously by traffic source, brand strength, and platform concentration. Here is what drives price and how to position your exit.

E-commerce Business Valuation

E-commerce businesses are typically valued on a multiple of Seller's Discretionary Earnings (SDE) for smaller businesses or EBITDA for larger ones. The multiple range is wide — 2× to 6× SDE — because the underlying risk profile of e-commerce businesses varies dramatically based on traffic source, supplier concentration, and platform dependency.

E-commerce Multiple Ranges

Single-platform (Amazon FBA only)

2–3.5× SDE

Platform concentration risk, no owned traffic

Multi-channel with owned DTC

3–5× SDE

Diversified channels, email list, brand assets

Strong brand + organic traffic

4–6× SDE

SEO moat, repeat customer base, defensible brand

Subscription / DTC platform

5–8× EBITDA

Recurring revenue, high LTV, management team

Platform Concentration Risk

Platform concentration is the defining risk factor in e-commerce valuations. A business that generates 90%+ of its revenue through Amazon is exposed to policy changes, listing suppression, Buy Box loss, and account suspension — all of which are outside the seller's control and all of which buyers will price heavily.

The correction: diversify sales channels before going to market. Adding a functioning Shopify DTC store (even if it's only 15–20% of revenue), a Walmart Marketplace presence, or meaningful direct email marketing revenue all reduce platform risk perception and support a higher multiple.

Amazon-specific risks buyers will model

→Account health score and suspension history

→Seller feedback rating and review velocity

→Patent or IP disputes on key ASINs

→Private label vs. reseller (reseller has weaker moat)

→FBA inventory storage and aging exposure

Traffic Source Due Diligence

For DTC e-commerce businesses, buyers will analyze traffic sources in detail. Organic search traffic is the most valuable — it represents a brand moat and is not subject to ad spend inflation. Paid traffic (Meta, Google) is the least valuable because the revenue disappears if ad spend stops or ad costs rise.

Organic / SEO traffic (best)

Sustainable, brand-driven, not dependent on paid spend. Buyers assign it the highest confidence in forward earnings. Document your top-ranking keywords and traffic trend data.

Email / owned audience

An email list with measurable open rates and revenue attribution is a genuine asset. Show buyers your list size, segmentation, and revenue-per-email-send metrics.

Paid social / search (lowest confidence)

Paid traffic is subject to ROAS compression, platform policy changes, and ad fatigue. Buyers will stress-test the business against a 30–50% increase in customer acquisition cost.

Repeat customer rate

A high percentage of revenue from returning customers validates brand strength and LTV. This is often the most compelling metric in a DTC e-commerce CIM.

Supplier and Inventory Considerations

Buyers will scrutinize supplier relationships carefully — particularly for private label businesses sourcing from overseas manufacturers. Key issues:

→Supplier agreements — are they written contracts or verbal relationships? Written, transferable agreements are strongly preferred.

→Supplier concentration — if one factory makes all your product, that's a single point of failure. Document backup supplier relationships.

→Lead times and minimum order quantities — buyers want to understand the capital cycle, especially for import businesses with 3–6 month lead times.

→Inventory on hand at close — how inventory is handled in the deal structure (included in price, separate, or SBA-financed) needs to be clear before buyer conversations.

→Country of origin and tariff exposure — any business heavily sourcing from China needs to address the tariff exposure transparently in the CIM.

Preparing Your E-commerce Business for Sale

Document 24+ months of clean financials

E-commerce P&Ls are complex — ad spend, COGS, platform fees, fulfillment, returns. Run clean monthly P&Ls by channel for at least 24 months. Buyers will want to see revenue, gross margin, and net income broken out by platform and product line.

Prepare a complete analytics package

Google Analytics, Shopify reports, Amazon Seller Central data, Meta Ads Manager — buyers will want 12–24 months of traffic, conversion, and customer acquisition data. Export and clean this data before going to market.

Trademark your brand name and any product lines. Patent your proprietary designs if applicable. Provide documentation of your IP ownership. This is often overlooked by e-commerce sellers and is a significant value driver and deal protector.

Document operating procedures (SOPs)

If the business relies on your institutional knowledge to operate, buyers will discount or require a long transition. Write SOPs for product ordering, customer service, listing management, and inventory management. A business that runs via documented processes is worth more.

Reduce owner involvement to under 10 hours/week

The benchmark most sophisticated buyers use. If you're working 40 hours a week in the business, they'll buy you a job, not a company. Automate, delegate, or document everything above 10 hours before going to market.

Who Buys E-commerce Businesses

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Amazon aggregators

Companies like Thrasio (scaled back), Perch, and dozens of smaller aggregators buy profitable Amazon FBA brands. They move fast, have standardized due diligence, and often close in 60–90 days. Multiples have compressed since 2021 but remain competitive for quality brands.

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Strategic acquirers

Brands in adjacent categories, retailers looking to add private label, or competitors looking to consolidate market share. Strategic buyers often pay the highest prices because they value synergies, but take longer to close.

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PE-backed platforms

PE funds building omnichannel portfolio companies. They are sophisticated buyers who will conduct thorough due diligence, but they can write checks for larger deals and provide liquidity in multi-stage transactions (earnout, rollover equity).

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Individual buyers and search funds

Individual entrepreneurs or search fund operators looking for an operating company. They move slowly and need SBA or seller financing, but they are the right fit for smaller transactions ($500K–$2M SDE).