ROI Calculator
Calculate the return on investment (ROI) for any business decision or investment.
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Total upfront cost of the investment
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Total revenue or savings generated minus ongoing costs
Common questions
What is the difference between ROI and CAGR?
ROI = (Net profit / Investment) × 100 — simple total return. CAGR (Compound Annual Growth Rate) = annualised return, accounts for time. A 60% ROI over 3 years sounds great, but the CAGR is only 17% — which puts it in context versus other investments.
What costs should I include in the investment?
Include everything: purchase price, installation, training, transition costs, opportunity cost of time, and any ongoing costs that are unique to this investment. Underestimating costs is the most common ROI analysis mistake — use conservative assumptions.
How do I calculate ROI for a marketing campaign?
Marketing ROI = (Revenue from campaign - Campaign cost) / Campaign cost × 100. If the campaign generates ₹5 lakh revenue for ₹1 lakh spend: ROI = 400%. Track attribution carefully — not all revenue from a period is attributable to the campaign. Use A/B testing where possible.
What is a good ROI for business investments?
Rule of thumb: any investment ROI should exceed your cost of capital (what you'd pay to borrow, or what the same money would earn elsewhere). If your loan rate is 12%, an investment ROI of 18% looks attractive. The higher the risk, the higher the required ROI.
Should I use ROI or NPV for large investments?
For investments over 3 years or those with irregular cash flows, use NPV (Net Present Value) — it accounts for the time value of money. ROI is simpler and good for quick decisions on smaller investments. For capital budgeting above ₹10 lakh, always use IRR and NPV alongside simple ROI.