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FormulaBeginner

What is ROI — and what it is not

Return on investment compares net gain to capital employed over a defined horizon.

6 minPrint Profit Navigator EditorialUpdated 08/07/2026

TL;DR

  • ROI without a stated horizon is meaningless — 60% over 5 years is not 60% per year.
  • The numerator must be cash-effective benefit, not accounting savings.
  • ROI ignores timing; use NPV or IRR when the cash flow profile matters.

ROI is the most quoted and least defined number in machine sales. Two vendors can present 40% and 180% for the same press simply by choosing different horizons and counting different benefits.

Definition

ROI over a horizon
ROI% = (Monthly_benefit × Horizon_months − Investment) / Investment × 100
  • Investment = purchase price + installation + training + infrastructure
  • Monthly benefit = cash-effective savings + sold output at contribution margin
  • Horizon = the period you commit to, typically 36 or 60 months

What belongs in the benefit

  • Overtime you stop paying, temp staff you stop booking, positions you do not fill.
  • Additional units you actually sell, valued at contribution margin.
  • Reduced material waste, rejects and reprints.
  • Minus: added energy, maintenance, insurance and financing cost.

€100,000 investment, €8,500 monthly benefit, 36 months

Total benefit
€306,000
Net gain
€206,000
ROI (36 months)
206%
Annualised, roughly
≈ 44% per year

Interactive example

Investment, monthly benefit — payback, ROI and NPV

Payback
11.8 months
ROI over 36 months
206 %
NPV
€ 171.250

Same calculation kernel as the full calculators. For a decision-grade result, open the matching calculator.

Run the numbers in a calculator

Machine ROIDoes this machine pay for itself — and when?Registration & Machine ImpactHow much output and money do registration and index time really cost me?

Turn your own numbers into a bank-ready PDF report.

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