MEASUREMENT WORKSHEET / SOFTWARE ECONOMICS
SaaS ROI Calculator
Estimate first-year software investment, annual benefit, net benefit, ROI, and simple payback from your own cost and benefit assumptions.
All calculator worksheets02 / Results
Illustrative default results. Change inputs and select Calculate.
- Total first-year investment
- Annual benefit
- Net first-year benefit
- ROI
- Simple payback months
Formula
Investment = software + implementation. Benefit = labor + revenue + avoided costs. Net = benefit − investment. ROI = net ÷ investment × 100. Payback months = investment ÷ benefit × 12 when benefit is greater than zero.
Worked example
The illustrative defaults use $12,000 software cost and $3,000 implementation cost, for $15,000 investment. Benefits of $10,000 labor, $6,000 revenue, and $2,000 avoided costs total $18,000. Net first-year benefit is $3,000, ROI is 20.0%, and simple payback is 10.0 months.
Interpret the result
A positive ROI means the entered first-year benefits exceed the entered first-year investment. A negative result means they do not. Zero benefit produces a negative net benefit and no finite payback estimate. The payback calculation treats annual benefit as evenly spread across twelve months, not as a dated cash-flow schedule.
Assumptions and input rules
All amounts must use the same currency and annual period. Investment must be greater than zero. Separate one-time implementation from recurring software cost. Keep a note of each benefit source, its owner, and the work needed to realize it. Reset restores the illustrative inputs and their results, not your last submission.
Limitations
This simple model does not discount future cash flows, model taxes, or account for a delayed rollout. Labor capacity released is not necessarily cash saved. Revenue is included as requested, not converted to contribution margin; a margin-based assessment may be more appropriate for your financial review. Avoid counting one retained contract as both revenue gain and avoided cost. Add ongoing administration to your cost assumptions if relevant, and compare conservative scenarios rather than treating one number as approval to buy.