Glossary · Reading the business
Distribution
In short
This is money paid out from a business's profits to its owners. It's distinct from salary or other compensation for work performed.
What it means in a deal
In an acquisition, you'll analyze past distributions to understand how much cash the prior owner was taking out and if the business can support both debt service and your desired owner compensation. Excessive distributions pre-sale can artificially depress cash in the business.
Related terms
Common questions about Distribution
Defined by CapBench 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.
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