ROI Calculator
Is your investment project profitable?
One of the key questions for any company considering a new investment project is how to calculate its profitability. To support you in this analysis, we have developed a free, open-access tool in the form of a configurable calculator. Our ROI calculator is therefore a decision-support tool for investments of any kind, within any company.
The purpose of this tool is to let any company assess the profitability of its investments in advance. In the vast majority of cases, this will determine whether or not the project to be funded is a viable investment.
ROI measures the economic value of an investment relative to its overall cost. It generally takes the form of a simple ratio comparing the cost of the investment with its return.
The standard formula is as follows:
In our calculator, the term "Benefits" has been replaced by "Operating gains", to better reflect our business as a manufacturer of industrial production equipment.
Our advice
Beyond this basic calculation, we recommend assessing what we call "long-term" profitability, by factoring in a few additional influences such as inflation, the growth in customer potential over the product's life cycle, and the possibility of progressive gains from a well-mastered, optimized production tool …
All these additional factors can influence the result positively, but also negatively, and therefore deserve to be taken into account. By letting you add extra data, our calculator lets you enter the various factors that affect your project.
Enjoy the calculator!
ROI Calculator
The number of years shown for operating costs, operating gains and results follows the investment spread period.
Chart
An investment becomes profitable for the company once the cumulative return crosses the total investment committed to the project.
ROI trend
A company assesses the return on its project sometimes over a one-year period, but most often over a period matching its profitability target.
There are two possible outcomes for this ROI:
- A positive ROI: the investment is profitable.
- A negative ROI: the investment generates losses.
[The higher the percentage, the more profitable the project is]
It is therefore important that a single annual ROI figure is not interpreted in isolation, but considered over a period matching the company's economic objective.
Overall visualization
You can generate a PDF file of your calculation,
with or without the additional information available to you below.