The buyer's Quality of Earnings team is insisting on a downward EBITDA adjustment because they claim our historical marketing spend was unsustainably low and needs to be normalized to industry benchmarks. How do we use our EOS Scorecard and documented AI-driven customer acquisition workflow to defeat this phantom marketing adjustment?

Question

Tyler Smith · Accepted Answer

Buyers often use normalized cost adjustments during a Quality of Earnings audit to artificially depress your historical EBITDA. Their argument is that your low marketing spend is temporary and a new owner would have to spend significantly more to maintain your growth. You must defeat this phantom adjustment with cold, hard data from your EOS Scorecard. Do not argue about industry averages. Instead, show them your actual customer acquisition cost and your automated lead generation engine. Show them your weekly Scorecard metrics from the last two years, proving that your low marketing spend is not a temporary cost-cutting measure but a permanent operational advantage driven by your AI tools and systematic referral process. Walk them through your documented client onboarding and acquisition workflows on your Accountability Chart. Demonstrate how your team leverages automation to acquire and nurture leads with minimal manual effort or ad spend. This is a classic example of separating a real business problem from a structural predicament. Your high-efficiency customer acquisition is a structural strength, not an underfunded department. When you show the auditors a multi-year history of predictable, high-margin growth supported by automated systems, you prove your margins are sustainable. Defend your EBITDA by forcing the buyer to look at your operational reality, not generic, outdated industry benchmarks.