A valuation multiple is the asking price divided by trailing annual profit. A $300,000 price on a store earning $100,000 a year in profit is a 3.0× multiple. Most established ecommerce stores trade at 2.4× to 3.8× annual profit. Enter a deal below to see where it lands.
Valuation multiple
Asking ÷ annual profit
3.0x
$300,000 ÷ $100,000/yr
Within the typical 2.4x–3.8x fair-value band for an established ecommerce store.
Ecommerce stores are valued on a profit (SDE) multiple, not a pure revenue multiple. Most established stores trade at 2.4x–3.8x trailing annual profit.
Revenue multiple vs. profit multiple
Despite the name people search for, established ecommerce stores are valued on a profit multiple, not a pure revenue multiple. A revenue multiple (price ÷ annual revenue) is mainly used for high-growth, pre-profit brands; for a profitable store it can be wildly misleading, because it ignores margin. This calculator uses trailing annual profit (or SDE), matching how TrustProfit computes the multiple shown on every listed store.
What counts as a good multiple
Below about 2.4× a store may be a bargain, or may carry risk worth uncovering in due diligence. Inside 2.4×–3.8× is the typical fair band. Above 3.8× usually requires verified growth, recurring revenue, or a defensible brand to justify the premium.
Frequently asked questions
What does the valuation multiple mean?+
The multiple is the asking price expressed as a ratio of the store's annual profit. A 3x multiple means the asking price is about three times trailing twelve-month profit — the quickest way to compare how aggressively two stores are priced.
What is a good revenue multiple for an ecommerce business?+
A good multiple for an established ecommerce store is roughly 2.4x to 3.8x trailing annual profit. Below about 2.4x a store may be underpriced or carry risk; above 3.8x usually requires verified growth, recurring revenue, or a defensible brand to justify.
How do you calculate a valuation multiple?+
Divide the asking price by trailing annual profit. A $300,000 asking price on a store earning $100,000 a year in profit is a 3.0x multiple. Use annual profit — or SDE — consistently so multiples are comparable across stores.
What multiple do ecommerce stores sell for?+
Most small-to-mid ecommerce stores sell for a profit multiple of about 2.4x to 3.8x trailing annual profit (equivalently, an SDE multiple). Larger businesses, roughly $5M and up, are valued on EBITDA multiples instead. TrustProfit shows each listed store's actual asking multiple so you can compare.
Is profit or revenue used to value a store?+
Profit, not revenue, drives most ecommerce valuations. Two stores with identical revenue can be worth very different amounts if their margins differ, so buyers price on trailing annual profit or SDE. Pure revenue multiples are mainly used for high-growth, pre-profit brands.
