Without doubt the number one question, I'm asked in CFOCare's valuation practice is what rules of thumb do you use in your valuation. This is a dangerous line of questioning and one that often leads to great disappointment when valuations come in lower than indicated...(OK, I admit sometimes they come in higher!)
Nevertheless the questions persist, so here's an extract from the Business Reference Guide:
| Industry | Valuation Rule of Thumb |
| Accounting Firms | 100–125% of annual revenues |
Auto Dealers (New Cars) | 0–10% of annual sales + inventory |
| Day Care Centers | 45–50% of annual sales |
| Dental Practices | 60–65% of annual revenues |
| Distribution / Wholesale in general | 50% of annual sales + inventory |
Engineering Services | 40–45% of annual revenues |
Grocery Stores (Supermarkets) | 15% of annuals sales + inventory |
Hardware Stores | 45% of annual sales incl. inventory |
Landscape Businesses | 45% of annual sales |
| Machine Shops | 55–65% of annual sales incl. inventory |
