A branded service center (franchise) asked $650K based on $125K in cash flow.

But:

❌ Owner worked 50+ hours/week at the front desk
❌ $22K addback = “owner vehicle” and “marketing”
❌ Franchise + royalty fees not properly adjusted
❌ No staff retention plan in place

📉 Normalized FCF = ~$38K
📦 Revised valuation = ~$225K

📌 Overprinting SDE without adjusting for the owner’s hours is a deal risk.