UK SME acquisition multiples: how to use the benchmarks

"What multiple should I pay?" is one of the first questions buyers ask, and one of the hardest to answer honestly. There are published figures for UK deals, and they are useful. But each comes from a different set of deals, over a different period, measured in a slightly different way. Used carelessly, a benchmark can talk you into overpaying just as easily as it can protect you.

This guide sets out what the main recent UK benchmarks show, what they cover, and how to use them alongside proper work on the business you are looking at.

What is an acquisition multiple?

An acquisition multiple is the price paid for a business divided by a measure of its profit. In UK SME deals the measure is usually EBITDA (operating profit before interest, tax, depreciation and amortisation). A business valued at £3m with £600k of EBITDA has changed hands at 5x.

Two definitions matter before any comparison:

• Which profit? Reported profit, or profit after adjustments for the owner's pay, one-off costs and so on ("normalised" EBITDA)? The same business can show very different multiples depending on which is used.
• Which value? Most benchmarks use enterprise value: the value before deducting debt and adjusting for cash and working capital. The price you pay for the shares can be quite different.

What do recent UK benchmarks show?

The table lists published figures we have checked against the original sources. It is not a complete market survey, and the figures are not directly comparable with each other.

A few things are clear even from this short list. Size has a large effect: in Dealsuite's data the multiple at £10m of profit is more than two and a half times the multiple at £200,000. Smaller businesses, which most SME buyers are looking at, sit well below the headline averages. And a sector figure from a consolidating niche, such as testing and inspection, can sit far above a general average.

Why might a benchmark not apply to your target?

Before you lean on any number, ask how closely the deals behind it resemble the one in front of you.

Size. This is the biggest single driver. A business making £400k is not comparable with the average deal in a survey covering businesses up to £200m revenue. Smaller businesses tend to carry more owner dependence, fewer customers and thinner management, and buyers price that risk.

Earnings adjustments. A multiple of normalised profit is only comparable if the profit has been normalised in the same way. If the seller's adjusted figure includes generous add-backs, a "market" multiple applied to it will overstate value. Rebuild the profit first. Our guide to valuing a business before buying shows how.

Business model. Recurring contracted revenue, a broad customer base and a strong second tier of managers support higher multiples. Project-based work, a few large customers or an owner who holds every relationship push them down.

Deal terms. Headline multiples often include money paid later if the business delivers (an earn-out). CMS's European M&A Study found earn-outs in 28% of the UK deals it advised on in 2025, and those deals skew larger than most SME purchases. A "6x" deal with a large earn-out is a different proposition from 6x paid in cash on completion.

Who is buying. Surveys mix trade buyers, private equity and individuals, who may pay differently for the same business. Many also rely on advisers' reports or disclosed deals, so private deals with undisclosed terms may be missing.

Averages and medians. An average can be pulled up by a few high-priced deals. A median (the middle value) is often closer to the typical deal. Check which one a source reports before comparing.

Worked interpretation: using benchmarks responsibly

Illustrative and fictional. This shows a way of thinking, not a valuation or a price for any business.

Suppose you are looking at a fictional regional distributor with £5m revenue and, after your own adjustments, £450k of maintainable EBITDA. The owner has mentioned a friend who "got 7x".

Here is how the benchmarks help you respond:

1. Place it by size. £450k of profit sits towards the smaller end of Dealsuite's range, much closer to the £200,000 point (3.3x) than the £10m point (8.4x). On almost any sensible value it would also fall in Price Bailey's under-£5m band, where multiples were consistently below 5x in the year to June 2026.
2. Check the definitions. Was the friend's 7x on enterprise value or the share price? On reported or adjusted profit? Was some of it paid later, depending on results?
3. Look at the specific risks. In this fictional case, the largest customer is 30% of sales and the owner manages the main supplier relationship personally. Both point towards the lower end of whatever range the evidence supports.
4. Do not interpolate a number. Benchmarks do not give you "the" multiple for £450k of profit. They tell you that 7x would need a strong explanation, and that your own work on profit, risk and funding should decide the figure.

The benchmark has done its job: it has set expectations and shown where the burden of proof lies. It has not priced the business.

What should you do with the numbers?

Use benchmarks at the start, to test whether a seller's expectations are in the right territory, and again at the end, as a sense-check on your own valuation. In between, the work is specific to the business: rebuilding profit, testing risks through due diligence, turning enterprise value into the price for the shares, and checking that you can fund and repay it.

Be wary of any single number presented without its source, period and definition. Published figures also change. The figures here are the latest we have checked, and we will update this page as new data appears.

Keep up with the market

The Acquisitiv Index is a free monthly report on the UK acquisition market from a buyer's point of view, with one sector in the spotlight each month. Get the Acquisitiv Index to keep your benchmarks current.