Industries
Your industry, the way a lender or a buyer reads it.
The same firm, read through your industry: what a lender or a buyer measures first, the figures they expect to see, the financing that fits, and the programs worth applying for. The typical figures below are the ones our free calculators grade you against.
12 industries
Which one is yours?
Professional servicesAccounting, law, consulting, engineering, architectureWhat matters, and what fits →
Software and subscriptionsB2B SaaS, platforms, subscription productsWhat matters, and what fits →
Construction and tradesGeneral and specialty contracting, civil, electrical, mechanicalWhat matters, and what fits →
Home and field servicesHVAC, plumbing, electrical, landscaping, cleaning, pest controlWhat matters, and what fits →
Manufacturing and physical productFood and beverage, wood products, metal fabrication, consumer goodsWhat matters, and what fits →
Wholesale and distributionDistributors, dealers, brokers of physical goodsWhat matters, and what fits →
Import and exportImporters, exporters, cross-border tradersWhat matters, and what fits →
RetailStores, showrooms, franchises with a storefrontWhat matters, and what fits →
Online storesE-commerce, marketplace sellers, direct-to-consumer brandsWhat matters, and what fits →
Restaurants and food serviceRestaurants, cafes, bars, catering, food trucksWhat matters, and what fits →
Transportation and logisticsTrucking, courier, freight, warehousingWhat matters, and what fits →
Health and medical practicesDental, physiotherapy, veterinary, pharmacy, clinicsWhat matters, and what fits →
Typical figures are broad averages for owner-led businesses in Canada, not targets, and a lender or a buyer will apply its own. They are here so you know the yardstick before someone else holds it up.
Accounting, law, consulting, engineering, architecture
Professional services
The business is its people and its relationships, so a lender or a buyer looks past the balance sheet to who does the work and whether clients would stay if the founder left.
What matters most
Owner dependencyHow much of the billing and the client relationships sit with one person. It sets the multiple more than any ratio does.
Utilization and rateBillable hours against capacity, and the effective rate per hour. Together they explain the margin.
ReceivablesProfessional firms are paid slowly. Days to get paid is the working-capital number a lender watches.
Recurring workRetainers and repeat clients are valued; one-off projects are not.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 55% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 18% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 3.0x to 4.0x adjusted EBITDA |
| Days to get paidMoney owed by customers, divided by a day's sales. | about 45 days |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.5x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 2.5x |
| Largest customerAbove that, lenders and buyers see a business that would be badly hurt by losing one account. | under 15% of sales |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Operating line of creditThe right facility for a firm whose cost is payroll and whose cash arrives 45 days later.
- Partner buy-in financingTerm debt to bring a new partner into ownership, usually against the firm's cash flow rather than assets.
- Practice acquisitionBuying a book of business or a retiring practitioner's firm, with a vendor take-back as part of the price.
Programs worth applying for
- BC Employer Training GrantTraining for professional staff.
- Canada Small Business Financing ProgramLeaseholds and equipment for a new office.
B2B SaaS, platforms, subscription products
Software and subscriptions
Valued on recurring revenue rather than profit, and financed on it too. The measures are different from every other industry here, and a lender who does not know them is the wrong lender.
What matters most
Recurring revenue and churnAnnual recurring revenue, how much of it renews, and how fast customers leave. Everything else is read against these.
Gross marginSoftware should keep most of every dollar. Hosting, support and onboarding costs are what pull it down.
Cost to win a customer against lifetime valueThe ratio that decides whether growth is worth funding.
Cash runwayMonths of cash at the current burn. The first question from any investor or venture lender.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 78% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 15% |
| ValuationSubscription businesses are priced on revenue that renews, not on profit. | 2.0x to 3.0x recurring revenue |
| Days to get paidMoney owed by customers, divided by a day's sales. | about 30 days |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.5x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 2.0x |
| Largest customerAbove that, lenders and buyers see a business that would be badly hurt by losing one account. | under 15% of sales |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Revenue-based and venture debtDebt sized on recurring revenue, for companies that are growing but not yet profitable.
- Operating line on receivablesOnce contracts are annual and invoiced, a bank will lend against them.
- EquityAn equity raise is a trade in securities, executed by our registered dealer partners.
Programs worth applying for
- NRC IRAPAdvisory and cost-shared funding for technical development.
- SR&ED tax creditsA refundable credit on eligible development work.
- Innovate BCProvincial programs for BC technology companies.
General and specialty contracting, civil, electrical, mechanical
Construction and trades
Thin margins, lumpy cash and bonding requirements. Lenders read a contractor's work-in-progress schedule before its income statement, because that is where the profit is really decided.
What matters most
Work in progressBillings against costs on every open job. Under-billing hides losses; over-billing borrows from next month.
BacklogSigned work not yet done. It is what a lender lends against and what a buyer pays for.
Holdbacks and days to get paidTen per cent of every invoice waits on completion. Cash arrives long after the work.
Bonding capacitySet by the surety on the strength of the balance sheet. It caps the size of job you can bid.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 22% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 8% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 2.5x to 3.5x adjusted EBITDA |
| Days to get paidMoney owed by customers, divided by a day's sales. | about 60 days |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.4x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 2.0x |
| Largest customerAbove that, lenders and buyers see a business that would be badly hurt by losing one account. | under 15% of sales |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Operating line of creditTo carry payroll and materials between progress draws.
- Equipment financing and leasingTrucks, excavators and tools, financed on the asset itself.
- Canada Small Business Financing ProgramGovernment-guaranteed loans for equipment and leaseholds.
Programs worth applying for
- BC Employer Training GrantApprentice and safety training.
- WorkBC wage subsidyWages while training a new hire.
HVAC, plumbing, electrical, landscaping, cleaning, pest control
Home and field services
Paid quickly, priced on the technician's hour, and valued on the service agreements that bring customers back. Among the most sought-after businesses for buyers, when the systems do not depend on the owner.
What matters most
Service agreementsRecurring maintenance contracts are the asset a buyer pays for.
Revenue per technician and per truckCapacity is the fleet and the crew. The numbers show whether either is idle.
Gross margin on labour and partsPricing discipline shows here first.
Owner dependencyWhether the phone rings for the company or for the owner.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 45% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 15% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 3.5x to 4.5x adjusted EBITDA |
| Days to get paidMoney owed by customers, divided by a day's sales. | about 15 days |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.4x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 2.5x |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Vehicle and equipment financingThe fleet, financed on the vehicles.
- Acquisition financingBuying a competitor's customer list and crew, a common route to scale.
- Operating line of creditSeasonal working capital.
Programs worth applying for
- CleanBC Go ElectricRebates on electric commercial vehicles and charging.
- BC Employer Training GrantTechnician certification.
Food and beverage, wood products, metal fabrication, consumer goods
Manufacturing and physical product
Asset-heavy and capital-hungry. Lenders like it, because there is equipment and inventory to lend against, and they look hard at how efficiently that capital is turned into shipped product.
What matters most
Gross marginMaterial, labour and overhead against price. Small changes move the whole business.
Inventory turnsHow many times a year stock is sold and replaced. Slow turns tie up the operating line.
Capacity utilizationHow much of the plant is producing. It decides whether the next order needs the next machine.
Customer concentrationOne large buyer is a strength until it is a risk.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 35% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 12% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 3.5x to 4.5x adjusted EBITDA |
| Days to get paidMoney owed by customers, divided by a day's sales. | about 50 days |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.6x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 3.0x |
| Largest customerAbove that, lenders and buyers see a business that would be badly hurt by losing one account. | under 15% of sales |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Equipment financing and leasingMachinery financed on the machine, over its useful life.
- Asset-based lendingA line sized on receivables and inventory together.
- BDC term loansLonger terms for expansion when the bank stops at the collateral.
Programs worth applying for
- BC Manufacturing Jobs FundCapital funding for projects that add jobs.
- NRC IRAPProcess and product innovation.
- CanExport SMEsEntering a new export market.
Distributors, dealers, brokers of physical goods
Wholesale and distribution
A business of margin over volume, run on working capital. The whole balance sheet is receivables and inventory, and the lender's question is how fast each turns into cash.
What matters most
Gross marginThin by nature. The difference between three per cent and five is the difference between a business and a hobby.
Days to get paid and days in inventoryThe cash conversion cycle. Every day shorter is money back on the line.
Supplier termsPayables are financing too; the terms a supplier gives are worth a bank facility.
Customer concentrationLenders discount a distributor that lives on one account.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 25% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 7% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 3.0x to 4.0x adjusted EBITDA |
| Days to get paidMoney owed by customers, divided by a day's sales. | about 45 days |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.6x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 3.0x |
| Largest customerAbove that, lenders and buyers see a business that would be badly hurt by losing one account. | under 15% of sales |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Asset-based lendingThe natural facility: a line that grows with receivables and stock.
- Receivables financingWhen growth outruns the bank line.
- Trade financeEDC insurance and guarantees on foreign receivables.
Programs worth applying for
- CanExport SMEsSelling into a new country.
- EDCInsuring receivables so the bank will lend on them.
Importers, exporters, cross-border traders
Import and export
Cash goes out months before it comes back, in another currency, through a port. Financing the gap and insuring the receivable is most of the work, and Crown lenders exist for exactly this.
What matters most
Cash conversion cycleDeposit to supplier, transit, customs, sale, collection. Count the days; a lender will.
Currency exposureMargin can disappear in a rate move. Hedging is a lending condition as often as a choice.
Concentration by supplier and customerOne supplier country or one buyer is the risk a lender asks about.
Gross margin after landed costDuty, freight and brokerage belong in the cost of goods, not overhead.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 22% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 6% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 2.5x to 3.5x adjusted EBITDA |
| Days to get paidMoney owed by customers, divided by a day's sales. | about 50 days |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.5x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 2.5x |
| Largest customerAbove that, lenders and buyers see a business that would be badly hurt by losing one account. | under 15% of sales |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Trade finance and letters of creditThe bank pays the supplier on your behalf, against the order.
- EDC guarantees and insuranceInsuring the foreign receivable makes it bankable.
- Asset-based lendingA line against inventory in transit and receivables abroad.
Programs worth applying for
- CanExport SMEsMarket entry costs shared.
- Trade Commissioner ServiceIntroductions in-market, at no cost.
Stores, showrooms, franchises with a storefront
Retail
Paid at the till, so there is no receivable to lend against; the money is in inventory and the lease. Buyers and lenders think in sales per location and per square foot.
What matters most
Sales per locationThe comparison every retailer is judged by.
Inventory turns and shrinkSlow stock and missing stock are the two quiet leaks.
Rent as a share of salesThe lease is the biggest fixed cost, and the hardest to change.
Gross margin by categoryWhere the margin actually comes from, which is rarely where the volume is.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 40% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 8% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 2.0x to 3.0x adjusted EBITDA |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.5x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 2.5x |
| Measured per locationHow businesses with a storefront are compared with each other. | sales and profit per site |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Canada Small Business Financing ProgramLeasehold improvements and fixtures, government-guaranteed.
- Inventory financingA line against stock, for the season.
- Merchant cash advanceFast and expensive. Know the real cost before you sign.
Programs worth applying for
- Buy BCMarketing funding for BC food and beverage products.
- FortisBC and BC Hydro rebatesLighting, heating and refrigeration.
E-commerce, marketplace sellers, direct-to-consumer brands
Online stores
The store is a set of numbers: cost to win a customer, what the customer is worth, and what is left after advertising. Inventory is the balance sheet, and the platform holds your cash for a while.
What matters most
Cost to win a customer against lifetime valueThe ratio that decides whether spending on ads builds a business or rents one.
Contribution margin after advertisingGross margin is not the number; what is left after the ad spend is.
Inventory turnsStock sitting in a warehouse is cash sitting in a warehouse.
Platform dependenceOne marketplace or one ad channel is a concentration risk, like one customer elsewhere.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 45% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 12% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 3.0x to 4.0x adjusted EBITDA |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.5x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 2.0x |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Revenue-based financingAdvances against sales, repaid as a share of revenue. Fast; price it carefully.
- Inventory financingFor the seasonal buy.
- Canada Small Business Financing ProgramEquipment and fit-out for a warehouse.
Programs worth applying for
- CanExport SMEsSelling into the United States and beyond.
- Innovate BCFor product and platform development.
Restaurants, cafes, bars, catering, food trucks
Restaurants and food service
High gross margin, low net margin, and everything depends on the lease, the labour and the location. Lenders are cautious; the ones who understand the industry lend on the operator's record.
What matters most
Prime costFood and beverage cost plus labour, as a share of sales. The single number a restaurant lives or dies on.
Sales per seat and per locationCapacity and how much of it is used.
Rent as a share of salesPast ten per cent, the lease is running the restaurant.
Owner's hoursA business that only works because the owner works eighty hours is valued accordingly.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 68% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 10% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 2.0x to 3.0x adjusted EBITDA |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.0x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 2.0x |
| Measured per locationHow businesses with a storefront are compared with each other. | sales and profit per site |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Canada Small Business Financing ProgramLeaseholds and kitchen equipment, the classic use.
- Equipment leasingOvens, refrigeration and fit-out on the asset.
- Merchant cash advanceCommon in the industry and usually the most expensive money on the page.
Programs worth applying for
- Buy BCMarketing for BC-made food and drink.
- FortisBC and BC Hydro rebatesKitchen and refrigeration efficiency.
- BC Employer Training GrantStaff training.
Trucking, courier, freight, warehousing
Transportation and logistics
A fleet on the balance sheet, fuel and drivers on the income statement, and receivables from shippers who pay when they pay. Equipment lenders know the industry well; that is the door to start with.
What matters most
Revenue per truck and per mileUtilization of the fleet decides the margin.
Days to get paidShippers and brokers pay slowly. Factoring is common for a reason.
Fleet age and replacementMaintenance rises with age; a lender wants to see the replacement plan.
Driver turnoverThe operating risk that shows up nowhere on the statements until it does.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 35% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 13% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 3.0x to 4.0x adjusted EBITDA |
| Days to get paidMoney owed by customers, divided by a day's sales. | about 45 days |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.3x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 3.0x |
| Largest customerAbove that, lenders and buyers see a business that would be badly hurt by losing one account. | under 15% of sales |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Equipment financing and leasingTrucks and trailers financed on the unit, including manufacturer finance.
- Receivables financingStandard in freight; compare the cost against a bank line.
- Operating line of creditFuel and payroll between collections.
Programs worth applying for
- CleanBC Go ElectricRebates on electric commercial vehicles.
- BC Employer Training GrantDriver and dispatcher training.
Dental, physiotherapy, veterinary, pharmacy, clinics
Health and medical practices
Steady, well understood by lenders, and valued on the patient base and the recurring visits behind it. Banks have specialist teams for professional practices; use them.
What matters most
Patient base and recallActive patients and how reliably they return. The asset a buyer pays for.
Revenue per practitioner and per roomCapacity, and whether the space or the people is the constraint.
Associate dependenceWhether the revenue belongs to the practice or to one clinician who could leave.
Days to get paidInsurers and public plans pay on their own schedule.
The figures a lender expects
| Gross marginSales less the direct cost of delivering them. | about 60% |
|---|---|
| EBITDA marginOperating profit before interest, tax and depreciation, as a share of sales. | about 20% |
| ValuationWhat a buyer of a well-run, owner-independent business in this industry ordinarily pays. | 3.5x to 4.5x adjusted EBITDA |
| Days to get paidMoney owed by customers, divided by a day's sales. | about 30 days |
| Current ratioWhat you could turn into cash within a year, against what is due within a year. | 1.5x or better |
| Debt to EBITDAHow many years of operating profit it would take to repay every loan. Lenders stop lending past this. | up to 2.5x |
| Measured per locationHow businesses with a storefront are compared with each other. | sales and profit per site |
Typical for owner-led businesses of this kind. The free reports grade your own figures against them.
Financing that fits
- Professional practice loansMost banks have a practice-finance team with terms built for this.
- Equipment financingClinical equipment financed on the asset.
- Practice acquisitionBuying a practice, with a vendor take-back and a transition period.
Programs worth applying for
- BC Employer Training GrantClinical and administrative staff.
- Canada Small Business Financing ProgramLeaseholds for a new clinic.
Not on the list?
Most businesses are a mix, and the measures still apply: what you keep from every sale, how quickly you are paid, what you owe against what you earn, and how much depends on one customer or one person. Run the health check with the closest industry and read the grades with that in mind.
Typical figures are broad averages and change with conditions. They are general information, not advice, and no lender or buyer is bound by them.
Want it read for your business? Request a call back.