Website & E-Commerce Business Valuation Benchmarks

Business owners, prospective buyers, and industry investors rely on a diverse set of financial benchmarks to assess the value of a business. We have compiled data from current BizBuySell listings and sold businesses to provide insight into the business for sale market and important benchmarks for pricing and evaluating website and ecommerce businesses relative to industry standards.

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Highlights of Website & E-Commerce Businesses Sold on BizBuySell

Website and ecommerce businesses listed and sold on BizBuySell are comprised primarily of privately owned small businesses engaging in online sales of physical and/or digital products. A smaller number of businesses produce content or media and generate revenue though ad sales or affiliate marketing.

Website and E-Commerce Business Transaction Trends

The median sale price of website and ecommerce businesses listed for sale has been volatile, though generally increasing. Pandemic related lockdowns lead to a boost in sales for online businesses broadly, and many owners capitalized on the trend to sell in 2021 at a higher value. Interest rate increases have put some pressure on prices as the cost to finance acquisitions has increased, while increasing median revenues improve valuations with some consistency.

Compared to brick-and-mortar businesses, online shops sell relatively quickly, with a median days on market roughly half that of other businesses.

Website and E-Commerce Business Valuation Multiples

Valuation, or pricing, multiples are financial tools that allow for comparisons between businesses that have different levels of sales and income. They represent the sales price of a business relative to its financial performance, and given enough individual business sales data, they represent what the market is willing to pay for a business given its revenue and earnings.

Valuation Trends

Business values and associated multiples fluctuate over time, influenced by a variety of macroeconomic factors such as interest rates, inflation, consumer spending, and overall economic growth. For websites and ecommerce businesses reported sold on BizBuySell, the average earnings multiple has remained fairly consistent over the past five years, with some volatility in-between likely related to interest rate changes.

Earnings Multiples

Earnings multiples represent the value of a business relative to its owner’s discretionary earnings or "cash flow". Arguably the most important valuation metric - as the seller's discretionary earnings will often dictate how much a buyer is able to borrow to finance the business acquisition - most valuations will hinge on a reasonable earnings multiple.

Revenue Multiples

Revenue multiples represent the value of a business relative to its overall annual sales or revenue. In conjunction with an earnings analysis, revenue multiples are commonly used to value a business based on its top line sales.

How to Interpret These Multiples

Recent Listings vs. Sold Businesses

We calculate and provide valuation multiples from two sources: Current and recent listings of online businesses for sale, and our database of "comparable" businesses sold on BizBuySell. Multiples based on listing data are usually higher due to owners setting asking prices above what their businesses might typically sell for. This occurs either intentionally as a negotiation strategy, or incidentally due to business owners’ common tendency to overvalue their own businesses. When current listing multiples are lower, that signifies decreasing values or previously inflated values of sold businesses.

Multiples based on comparable businesses - "comps" in business broker parlance - are much more useful as they represent the prices at which businesses ultimately get sold. Business brokers and valuation professionals will always turn to local comps when pricing businesses for sale or evaluating businesses for acquisition. We provide both sets of data at the national level to offer general context. Local business sale comps by sales class suitable for pricing and negotiations are available in BizBuySell's Business Valuation Report.

Quartiles, Median, and Average

No two businesses are identical, and as such, valuation multiples exist in a range. We have carved out four common values within this range: Lower quartile represents the value under which the lowest 25% of valuation multiples fell. Upper quartile represents the value above which the highest 25% of multiples fell. Median is the middle of the range, and average is the mean of the set. Mean is almost always higher than the median, driven by a minority of high volume, high value businesses sold at multiples above the upper quartile.

Businesses with consistent financial performance, above average revenue and earnings, demonstrable growth potential, low owner involvement, unique competitive advantages, and a seller willing to finance will command a multiple at or above the upper quartile. Smaller businesses with thin profit margins, full-time owner involvement, and many direct competitors will trade at or below the lower quartile. Most businesses will fall somewhere in the middle.

Based on this data, half of website and ecommerce businesses will sell for an amount between 2.6- and 4-times their annual seller discretionary earnings, with 25% of exceptional, larger businesses trading above this range, and 25% of smaller, less desirable businesses trading below.

Financial Benchmarks

To determine how a business compares in terms of revenue and earnings performance relative to industry peers, it’s necessary to have some insight into industry standards. "Benchmarking" describes the practice of comparing a business’s financial performance to typical industry standards to determine where a business falls relative to other businesses in the same industry. These benchmarks can help guide owners and investors towards appropriate valuation multiples from the range above.

To that end, we have aggregated online business financial ranges useful for comparing an individual business to the broader industry.

Website & E-Commerce Revenue and Earnings Trends

The median discretionary earnings and revenue for website and ecommerce businesses has increased with some volatility over the last five years. Between 2021 and 2025, median earnings for these businesses sold on BizBuySell rose 30% while median revenue increased 52%.

Earnings Ranges

Discretionary earnings (used interchangeably with the terms "cash flow" and seller's discretionary earnings or SDE) is often the crux of business valuations, so it is important to benchmark it relative to similar businesses traded on the market. Below you will find discretionary earnings ranges for website and ecommerce businesses sold over the past five years, as well as recent website and ecommerce business for sale listings.

Revenue Ranges

Sales volume plays a large role in business valuation, as it measures the size of the potential income opportunity for new ownership. It's not uncommon for buyers to select an earnings multiple range based on overall revenue. The table below includes revenue ranges of website and ecommerce businesses sold over the past five years and recent businesses listed for sale.

How Revenue and Earnings Level Affects Business Values

Clearly higher levels of earnings lead to higher valuations, even given the same multiple. However, valuation multiples also tend to rise with business sales volume. Popular websites that generate higher sales (and maintain reasonable profit margins) tend to sell for earnings multiples on the higher end. So, a website business generating over $2.6MM may sell for an earnings multiple close to 4, where a lower traffic business with sales below $400k may trade closer to 2.5 times earnings.

This tendency for higher sales volumes to fetch higher valuation multiples is largely driven by the economics of business acquisition financing. Higher volume businesses give buyers more cushion to cover debt service obligations and still have enough left over to pay the new owner a reasonable income.

Sector Comparisons

For a more complete understanding of the market and valuation standards, consider comparisons within the broader technology sector when benchmarking website businesses. The chart and table below include key metrics from sales of online and technology businesses on BizBuySell between 2021 and 2025.

Compared to other businesses in the technology sector, website and ecommerce business valuations relative to sales and owner earnings are in line with the group, given their higher typical sales volume.

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