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 a Plumbing Business

Plumbing is one of the few home services sectors where recurring revenue and service agreements are genuinely secondary — and buyers know it. But the right buyer, the right preparation, and the right broker still make a substantial difference in outcome.

Plumbing Business Valuation

Plumbing businesses are typically valued on Seller's Discretionary Earnings (SDE) for owner-operated businesses under $3M in revenue. The multiple ranges widely depending on how much of the work is service/maintenance versus emergency call-out, and whether the owner is a licensed master plumber whose departure would trigger re-licensing requirements.

Plumbing Multiple Ranges

Owner-operated, reactive only

1.5–2.5× SDE

High key-man risk, no recurring base

Mixed service + installation

2.5–3.5× SDE

Established book, some commercial accounts

Commercial-dominant, management team

3.5–5× SDE

Contracts, less owner-dependency

Platform scale ($1M+ EBITDA)

4–6× EBITDA

PE-attractive, multi-truck, branded

The License Transferability Problem

The single most common complication in plumbing business sales is master plumber license portability. In most states, the business's license is tied to the qualifying licensee — often the owner. If you are the sole licensed master plumber in the business, buyers face three scenarios after close:

→They hire or partner with a licensed master plumber (adds cost and delays)

→They acquire the business and operate on a temporary license while their own master plumber gets licensed (complicated and state-dependent)

→They require the seller to stay on as a licensed employee or consultant for a defined period post-close

The solution: hire and retain a licensed journeyman or master plumber employee before going to market. Having a non-owner licensee in the business removes this risk and typically adds 0.5–1.0× to the SDE multiple.

What Buyers Value Most

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Commercial maintenance contracts

Recurring commercial plumbing maintenance contracts (apartment complexes, commercial buildings, restaurants) are the highest-quality revenue in plumbing. They provide predictable cash flow and are largely transferable with proper introductions.

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Branded truck fleet + Google reputation

A recognizable brand with strong Google reviews and a dispatched truck fleet signals operational maturity. Buyers pay for brand — it means lower customer acquisition cost and repeat business.

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Non-owner licensed employees

A master plumber employee who can run the field operation independently is a significant value creator. It removes key-man risk and allows the buyer to operate without requiring their own license immediately post-close.

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Service area density

Like pest control, route density matters. Plumbing businesses with customer concentration in a tight geography have lower drive time, higher jobs-per-day, and better margins.

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Documented technician training system

Apprentice programs, documented procedures, and in-house training systems signal that the business can scale without the owner as the institutional knowledge holder.

The PE Roll-Up Landscape

Plumbing is in the middle of a significant PE consolidation wave. Companies like Neighborly, Franchise Group, and dozens of regional PE-backed platforms are actively acquiring plumbing businesses in the $500K–$5M EBITDA range. These buyers move faster than individual buyers, often have pre-approved SBA and conventional financing structures, and pay in the top quartile of market multiples.

The key to accessing these buyers is working with a broker who has established relationships in the home services M&A ecosystem — not a generalist who will list your business on BizBuySell and wait for inbounds.

Preparing Your Plumbing Business for Sale

Resolve the license situation now

If you are the sole licensed master plumber, hire and develop a licensed employee 18–24 months before you plan to sell. This single step often adds $100K–$300K to your final sale price by removing the buyer's biggest risk.

Build your Google presence

Plumbing is a high-intent, local search category. A Google Business Profile with 50+ verified reviews and consistent 4.5+ stars is a real business asset that buyers will pay for. Systemize your review request process before going to market.

Document your commercial accounts

Any recurring commercial relationships should be in writing — even a one-page service agreement or letter of understanding beats a verbal arrangement in due diligence. Call your top 5 commercial customers and formalize the relationship.

Get 3 years of clean financials

Plumbing businesses often have high add-backs (owner truck, phone, health insurance, meals). Document every add-back with supporting records and run a clean P&L showing normalized earnings. Buyers and their accountants will verify every line.

Separate real estate if you own it

If you own your shop or yard, sell the business and lease the real estate back to the buyer. The combined sale of real estate and business is almost always worth more than a bundled transaction.