<b>SOP #48 — P&L Add-Back Scrutiny</b>

<b>SOP #48 — P&L Add-Back Scrutiny</b>

Sellers inflate net profit with 'add-backs' — expenses they claim won't recur for you. Challenge every one.

1. Get the P&L with every line item, not a summary. Reject any 'trust me' number.
2. List all add-backs separately. Common ones: owner salary, one-time tools, a single content sprint.
3. Test each: will YOU actually avoid this cost? Content still needs writing. Hosting still bills.
4. Reject owner-labor add-backs unless you can truly run it passively — most can't.
5. Add back the costs the seller hid: their own unpaid hours, free tools on a trial, family help.
6. Rebuild a clean 'buyer's net' from the bottom. Multiply that, not their adjusted figure.

The multiple applies to sustainable profit you'll actually keep. Nothing else.

Save this — run it every deal.