How Restoration Businesses Are Valued
Restoration businesses are valued on Seller's Discretionary Earnings (SDE). What makes restoration attractive to buyers is the insurance-paid revenue model — most restoration work is covered by homeowner or commercial insurance policies, which means reliable payment at standardized rates. Buyers focus on your TPA (Third Party Administrator) relationships, insurance program memberships, and the mix between emergency mitigation (high-margin) and reconstruction (lower-margin).
SDE = Net Profit + Owner’s Salary + Owner Benefits + Discretionary Expenses
They then multiply your SDE by an industry-specific multiple derived from comparable transactions. For Restoration businesses, that multiple currently ranges from 2.5x to 4.5x.
Quick Example
A Restoration business with $300K in SDE at a 3.5x multiple would have an estimated value of $1.05M. At the full range of 2.5x–4.5x, the estimated value is $750K–$1.35M.
Current Restoration Multiples
Restoration is actively consolidated by franchise groups and PE-backed platforms. Businesses with strong TPA relationships and IICRC-certified teams consistently command premium multiples.
| Revenue Range | Typical SDE Multiple | What This Means |
|---|---|---|
| Under $1M | 2.0x – 2.8x | Owner-managed, limited TPA relationships |
| $1M – $3M | 2.5x – 3.5x | Established insurance relationships, certified team |
| $3M – $10M | 3.0x – 4.5x | Multiple TPA programs, project managers, 24/7 dispatch |
| $10M+ | 4x–7x EBITDA | Multi-location, full-service restoration platforms |
Want to understand how these multiples work and what EBITDA vs. SDE means for your business? Read our full guide: How Service Businesses Are Valued.
What Drives Your Number Up (or Down)
Two Restoration businesses with the same revenue can be worth very different amounts. Here are the factors that separate high-multiple from low-multiple businesses:
Drives Multiple Up
- TPA and insurance program relationships — preferred vendor status with insurance carriers and TPAs
- IICRC certifications — WRT, FSRT, and AMRT certifications across the team
- 24/7 emergency response — dispatch capability for after-hours water and fire calls
- Mitigation-heavy revenue mix — emergency mitigation is higher margin than rebuild/reconstruction
- Contents and specialty services — electronics, documents, textiles restoration adds revenue per job
Drives Multiple Down
- Owner handles all insurance communications — TPA relationships and claims management depend on one person
- No TPA relationships — relying on retail customers or plumber referrals only
- Reconstruction-heavy mix — lower-margin rebuild work without high-margin mitigation
- No emergency response capability — business hours only limits the highest-value calls
- Equipment condition — aging dehumidifiers, air movers, and extraction equipment
If you’re not sure where you stand on these factors, our Exit Readiness Assessment scores you across all of them in about 3 minutes.
Frequently Asked Questions
What is the average restoration business worth?
Restoration businesses typically sell for 2.5x to 4.5x their Seller's Discretionary Earnings (SDE). For a business with $300K in SDE, that translates to an estimated value of $750K to $1.35M. Companies with strong TPA relationships and IICRC-certified teams trade at the higher end.
What SDE multiples do restoration businesses trade at?
Based on recent transaction data, restoration businesses trade at SDE multiples of 2.5x to 4.5x. Larger operations valued on EBITDA trade at 4x to 7x. The insurance-paid revenue model and active PE consolidation support strong multiples in this space.
How can I increase the value of my restoration business before selling?
Build TPA and insurance carrier relationships beyond your personal contacts, ensure your team holds current IICRC certifications, develop 24/7 emergency response capability, and shift your revenue mix toward mitigation (higher margin) rather than reconstruction.
Get Your Free Restoration Valuation Estimate
Our free valuation tool uses real Restoration SDE multiples and adjusts for your specific value drivers. It takes about 3 minutes.
What’s Your Restoration Business Worth?
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Get My Free Estimate →Planning your exit? Read our 12-Month Exit Timeline for a step-by-step preparation guide.