Step 5. Subtract the total of earning power ( 2) and reasonable salary ( 3) from this average net earnings figure ( 4). This gives the extra earning power of the business. Step 6. Use this extra earnings figure to estimate the value of the intangibles. This is done by multiplying the extra earnings by what is termed the “ years- of- profit” figure. This “ years- of- profit” multiplier pivots on these points. How unique are the intangibles offered by the firm? How long would it take to set up a similar business and bring it to this stage of development? What expenses and risks would be involved? What is the price of goodwill in similar firms? Will the seller be signing an agreement with a covenant not to compete? If the business is well- established, a factor of five or more might be used, especially if the firm has a valuable name, patent, or location. A multiplier of three might be reasonable for a moderately seasoned firm. A younger but profitable firm might merely have a one- year profit figure.