How to Value a Business for Sale in Hong Kong

Why Valuation Matters

Price too high and your business sits unsold for months. Price too low and you leave money on the table. An accurate valuation is the foundation of a successful sale.

Method 1: Multiple of Net Profit (Most Common)

The standard method for small businesses in Hong Kong. You multiply your annual net profit by an industry-specific multiple.

Example: A restaurant with HKD 65K/month net profit = HKD 780K/year. At 2.5x multiple = HKD 1.95M valuation.

Method 2: Asset-Based

Used when the business has significant tangible assets (equipment, inventory, vehicles). Value = total assets minus liabilities. Common for manufacturing and logistics.

Method 3: Revenue Multiple

Used for early-stage or pre-profit businesses. Typically 0.5-2x annual revenue depending on growth rate and industry.

Factors That Increase Value

• Recurring revenue: Multi-year contracts or subscription model (+20-30%)
• Long lease: 2+ years remaining at favorable rent (+10-15%)
• Trained staff: Employees willing to stay with new owner (+10%)
• Brand & customer database: Established reputation and loyalty
• Growth trajectory: Revenue/profit trending upward
• Transferable licenses: Liquor license, food license, etc.

Factors That Decrease Value

• Declining revenue or profit
• Short lease remaining or high rent
• Key-person dependency (owner is the business)
• Legal disputes or regulatory issues
• Outdated equipment requiring investment

Free Valuation Tool

Use our free instant valuation calculator to get an estimate based on your industry, revenue, and profit. Then list your business on Easy Biz at the suggested price.