To a buyer, a distributor can be an intermediary between manufacturer and customer: easy to replace and valued low. Or it can be a specialist business with capabilities, relationships and authorisations that cannot be rebuilt quickly. The difference lies not in the sector label but in the business model and in how it is presented.
1. The starting point: multiples in wholesale
According to the M&A Monitor CEE (Dealsuite, August 2026), the average EV/EBITDA multiple for wholesale in Central and Eastern Europe is 4.6x, with a typical range of 3.9–5.0x. For comparison: industry and manufacturing 5.4x, healthcare and pharma 7.8x.
Wholesale also attracts fewer buyers. There are on average 3.9 seriously interested parties per company for sale, against 7.5 in healthcare. Less competition means a weaker negotiating position for the seller. The full sector table is in EBITDA multiples in Poland and CEE.
2. What raises a distributor’s value?
A buyer will pay more for the elements that are hard to copy and that stay with the company after the change of ownership:
- Exclusive agreements with manufacturers: long-term, with clear renewal terms and no clauses allowing the manufacturer to terminate on a change of control.
- Service and technical work: recurring revenue, often at higher margins than product sales, built on the installed base.
- Registrations, approvals and certifications: especially in medical distribution, where obtaining them takes time and expertise.
- Technical and application advice: a team that helps customers select and implement a solution, not one that only takes orders.
- Customer relationships: long-standing, spread across many customers and held by the company rather than by the owner.
- Own brand, logistics or products: elements that reduce dependence on a single supplier.
3. What lowers a distributor’s value?
- Dependence on one manufacturer. If a key supplier can terminate or start selling direct, the buyer will price that risk very harshly.
- Short or informal distribution agreements. “We have worked together for 20 years on the basis of emails” is not security for an investor.
- Relationships held by the owner. If customers and manufacturers only talk to the owner, the buyer fears losing them after the deal.
- High inventory and long payment terms. Distribution is capital-intensive. Working capital directly affects the amount the seller receives.
- No profitability data. Without margins by manufacturer, product line, customer and service, it is hard to show where the company makes money.
“The way a company is presented does not change its results. It can change the way a buyer calculates its value.”
4. Who buys distribution companies?
The pool of potential buyers is wider than many owners assume:
- Manufacturers, acquiring distributors to gain direct market access and control over sales and customer relationships.
- Other distributors, domestic or foreign, looking for new markets, product portfolios or scale.
- Private equity funds, often in a buy-and-build strategy that combines several smaller distributors into a larger platform.
Each of these buyers will value the same company differently. A manufacturer may pay more for customer relationships but less for agreements with competing brands. A fund will value recurring service revenue and the management team. The differences between investor types are covered in Strategic or financial investor?
5. How to prepare a distribution company for sale
- Review the manufacturer agreements. Term, exclusivity, termination rights and change-of-control clauses. This is often the first thing a buyer asks about.
- Split the results. Show revenue and margins separately for product sales, service and other services. Service revenue may be valued quite differently from trading.
- Reduce dependence on a single supplier, or at least document how durable that relationship is.
- Move relationships from the owner to the team. Customers and manufacturers should know the key sales people and product managers.
- Get working capital in order. Show the seasonality of inventory and receivables and explain unusual movements.
- Describe strengths in the buyer’s language. Not “we have good relationships”, but for example “X% of revenue comes from customers who have worked with us for more than five years”.
Many of these changes take time, especially renegotiating agreements and moving relationships to the team. It is worth starting two to three years before a planned sale.
Will a buyer see an intermediary in your company, or a partner that manufacturers and customers cannot easily replace?
Data source: Dealsuite, M&A Monitor CEE, August 2026 (107 advisory firms, transactions in H1 2026, companies with EUR 1–50m revenue). More at www.dealsuite.com. Protectimo’s founder has transaction and management experience in medical, industrial and technical distribution. Polish version: Jak kupujący wycenia firmę dystrybucyjną?