Question 1

How do I estimate labor/time savings in dollars?

Accepted Answer

Multiply the hours saved per week (or month) by the fully-loaded hourly cost of the people whose time is freed up — salary plus benefits, divided by roughly 2,080 working hours a year for a rough hourly figure. Be conservative: savings only translate to real dollars if that freed time gets redirected to other valuable work, not just to a lighter workload.

Question 2

What’s a reasonable analysis period to use?

Accepted Answer

3 years is a common default for software ROI — long enough to amortize the implementation cost, short enough that the underlying assumptions (headcount, process, pricing) are still likely to hold. For longer periods, revisit whether the annual savings and costs would really stay constant.

Question 3

Why is the payback period sometimes blank?

Accepted Answer

Payback period only has a defined answer when the tool generates positive net monthly benefit (savings plus revenue gain exceeding the ongoing software cost). If your inputs show a net loss each month, there’s no point at which the implementation cost gets recovered, so the calculator leaves it blank rather than showing a misleading negative or infinite number.

ROI Calculator for Business Software

Cost vs. benefit over the analysis period

Common questions