Glossary · Reading the business
In short
The costs incurred in running a business to generate revenue, such as rent, utilities, and salaries. Buyers care because expenses directly reduce profit and impact the business's overall financial health.
Scrutinize every line item on the P&L to understand the business's expense structure. Differentiate between fixed and variable expenses. Look for discretionary expenses or owner-related costs that can be added back to calculate SDE. High or unusual expenses warrant further investigation during due diligence.
Defined by DealRoom.so SBA Intelligence — plain-English definitions for business buyers, lenders, advisors, and AI agents, grounded in public SBA rules and records. Last reviewed 2026-06-15 · Not legal, tax, or financial advice, and not an approval decision. Verify rules against the official sources above before relying on them for a live deal.
Pressure-test the numbers before you make an offer
Send us the asking price and the seller's cash flow — we'll show whether the deal services SBA debt and where the add-backs are likely to hold up.
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