For any business, it’s good to know the Return on Investment for any project. It’s a good way to measure if a project is beneficial and be able to compare multiple projects. To arrive at the Return on Investment (ROI), you will subtract the Cost of Investment from the Gain from Investment all divided by the Cost of the Investment. Simple, however, in business you need to show what your actual drivers are and what you are calculating into the cost. The Return on Investment Calculator Template allows you to calculate a 3-year ROI.
How to Use the Return on Investment Calculator
This calculator is meant to be a simple and easy way for organizations to measure their ROI. Of course with any free financial analysis tool, this makes it all the better. You can download this simple calculator here. It will open in Excel for you to customize to your organization’s needs, however you should keep the formulas as is for it to work correctly.
- The first cell you will input your company name and the third cell update the date.
- Cells 5 through 7 are a legend. This is for information purposes and can be deleted off the sheet once the sheet is completed if necessary.
- “Data cell key” is in blue. It’s information that describes a particular section. You can change the terminology if it’s more beneficial for your organization.
- The bolded black wording means all descriptions will go there.
- The grayed out cells are meant for formulas and should not be changed.
- The Cash flow and ROI statement section should be edited for your organization. Notice there is room for more benefits to be added below. Update your numbers for Years 1, 2 and 3.
- The Costs, Benefits, and Discounted benefit flow are all auto calculated. No input is needed here.
- Input the information needed for the Initial Investment section.
- Finally, update your Cost of Capital percentage. Your ROI measures are all updated at this point.
Tips for Using the Return on Investment Calculator
The Return on Investment Calculator prints on 2 landscaped pages. It has a nice layout and can be used in a presentation or as paper handouts. To add more appeal, add your company logo in the upper right hand corner within the area of cells E1 and F4.
The Return on Investment Calculator found here is a great ready-made calculator for those interested in financial analysis and need a place to start.
Download: Return on Investment Calculator
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