What is a good EBITDA margin for a small business?

Most healthy small businesses run an EBITDA margin between 10% and 20%. Service businesses and SaaS often run higher (20–35%+), while restaurants and retail typically run 10–15%. CFO Grade compares your EBITDA margin to industry-specific benchmarks across 16 sectors.

What DSCR do lenders look for?

Most SBA and commercial lenders require a Debt Service Coverage Ratio (DSCR) of at least 1.25x. Construction surety bonds often require 1.5x or higher. A DSCR below 1.0x means your EBITDA does not cover your annual debt payments.

How does CFO Grade calculate the letter grade?

CFO Grade scores 24+ financial ratios across profitability, liquidity, leverage, and efficiency — weighted by industry. The composite score maps to a letter grade from A+ to F. The full methodology and benchmark sources are described in the report and the disclaimer page.

Yes. The full analysis, 24+ ratios, letter grade, and industry benchmarks are completely free with no signup. Optional paid features include a $9 PDF export and a $19 Pro Pass with AI-generated CFO memo and 30 days of unlimited PDFs.

Do I need to create an account?

No account is required. Your numbers stay on your device unless you explicitly opt in to anonymized peer benchmarking. Pro entitlements are bound to your device with a restore link you can email yourself.

Is CFO Grade financial advice?

No. CFO Grade provides educational insights for business owners and analysts. It is not financial, tax, legal, or investment advice. Always verify the output with a qualified professional before making business decisions.

How does CFO Grade estimate what my business is worth?

Every report includes an Enterprise Value range built from your industry's typical EV/EBITDA multiple applied to your EBITDA, adjusted for size (Duff & Phelps size-discount methodology) and quality (your CFO Grade). The paid report unlocks the lender view vs. buyer view breakdown, implied equity to owners, sensitivity analysis, and full source-cited methodology. The dedicated valuation calculator lives at /valuation with industry-specific pages for 11 sectors.

Why does my business valuation change when I rerun the report?

The range moves with three things: your EBITDA (the biggest driver), your revenue size band (which sets the size discount), and your CFO Grade quality factor. When you run a second report in a later period, the Enterprise Value delta is shown prominently — 'You built $220,000 of value since Q3' or 'You lost $180,000 this quarter' — so you can watch the number that actually matters to lenders and buyers over time.

Hospitality & lodging

RevPAR is up. Are you profitable?

Hotels, B&Bs, vacation rentals — revenue metrics are necessary but not sufficient. Get the financial read your bank actually cares about.

Free

Industry benchmarks

No signup

Worth quotingHotels with labor cost above 35% of revenue rarely sustain a 25%+ EBITDA margin — labor discipline is the single largest controllable lever in lodging profitability.

Built for owners and analysts who say…

"Strong RevPAR but the operating margin is shrinking.
"Labor and OTA fees are eating gross margin.
"DSCR check before a property-acquisition loan.

What you'll get

Hospitality-specific EBITDA and DSCR
Margin breakdown by major cost line
PDF for your hotel lender
Plain-English memo on margin protection

Common questions about hospitality & lodging financials

What is a healthy EBITDA margin for a hotel?+

Healthy EBITDA margin is 20–35% for most independent and branded hotels. Limited-service brands often hit 30–40%. Full-service and resort properties 20–28%. Below 18% suggests labor, OTA fees, or property-tax costs are running hot.

How do hotel lenders evaluate financial health?+

Lenders look at DSCR (1.25× minimum, 1.4× for premium properties), Debt/Assets (under 60%), and stabilized EBITDA. Acquisition financing typically requires 12 months of stabilized operations or strong comp data for new builds.

Why is my RevPAR up but my profit down?+

Three common reasons: (1) ADR growth attracting higher OTA commission rates, (2) labor cost rising faster than rate, (3) property-tax reassessment based on the higher revenue. Look at EBITDA margin trend — if RevPAR climbed 8% but EBITDA margin fell 200 bps, you have a cost-structure problem.

What is the biggest financial risk for hotels?+

Concentration: of revenue (one corporate contract or OTA), of season (peak/off-peak swings), and of debt service (balloon payments). The most-cited cause of hotel failure is refinancing risk during a soft cycle, not operating losses.