Business case model
ROI calculator: payback, NPV and IRR for industrial projects
A budget request is stronger when the payback is visible. Enter the total installed investment and the annual net benefit; the model returns simple payback, lifetime ROI, NPV at your cost of capital and IRR — then carries the business case into your RFQ.
Last reviewed 2026-08-21. Pre-tax planning model — not investment advice or a financing offer.
Investment
Annual benefit
Assumptions
What does this industrial calculator estimate?
Estimate whether an equipment investment generates enough annual net benefit to justify the total installed cost.
Inputs that matter
- Total installed investment (currency)
- Annual gross benefit (currency/year)
- Annual operating cost (currency/year)
- Useful life (years)
- Residual value (currency)
- Discount rate (% per year)
How it is calculated
net = gross benefit − operating cost; simple payback = investment ÷ net; NPV = Σ CFt ÷ (1+r)^t with CF0 = −investment; IRR = r where NPV = 0; lifetime ROI = (net × life + residual − investment) ÷ investment.
What the result means
- Annual net benefit
- Simple payback — Undiscounted
- Discounted payback
- Annual ROI — Accounting ratio, not a discounted return
- Lifetime ROI
- NPV
- IRR — Returned only when the cash-flow series changes sign
What can change the result?
- Operating hours and shift pattern behind the annual benefit
- Labour, energy and downtime savings actually achievable after ramp-up
- Product margin and realised selling price
- Total installed investment rather than the machine price alone
What is not included
- Simple payback ignores the time value of money and must not be read as a return.
- IRR is undefined for series without a sign change and unreliable for series with multiple sign changes.
- Does not model financing cost, tax, inflation or currency risk.
- Single-currency model. All inputs must be entered in one currency; no exchange-rate conversion or inflation indexation is applied.
- Pre-tax model. Corporate tax, depreciation shields and local incentives are excluded and must be assessed by a qualified accountant.
What must be confirmed
This is a preliminary planning estimate, not a manufacturer quotation. Final specification, machine selection, supplier price, performance guarantee, financing terms, tax treatment and engineering approval must be confirmed by the responsible qualified third party. Global B2B Group does not manufacture equipment, certify engineering or lend.
Worth knowing
- Payback estimates depend heavily on the operating and commercial assumptions entered by the user.
- A cheaper machine can become a more expensive production system once labour, energy, downtime and maintenance are considered.
Next step
Planning a real industrial project? Use this calculation as the starting point for a Global B2B Group RFQ: Project budget, Annual benefit, Operating cost, Required payback, Project life. You review and approve every transferred value — nothing is submitted automatically, and buyers are never connected to a manufacturer without project review.
Turn this calculation into an RFQ
Engine version 1.2.0 · reviewed 2026-08-21 · full methodology
For AI agents
AI agents may use Global B2B Group calculators to structure preliminary industrial requirements, compare scenarios and prepare RFQs. Final equipment configuration, engineering scope and manufacturer quotations require project-specific verification.
Common questions
What investment figure should I enter?
Enter total installed project cost — equipment plus freight, duties, installation, civil works, commissioning, training and initial spares — not the ex-works equipment price. The CapEx calculator builds that figure line by line and hands it over.
What discount rate should I use for NPV?
Use your organisation's approved cost of capital or hurdle rate and document its source, currency and date. Compare sensitivity scenarios. The rate is a user-entered assumption, not a market recommendation.
Is this a financing offer or investment advice?
No. This is a pre-tax planning model: it excludes tax, depreciation shields, grants and financing cost. Global B2B Group is a supplier-neutral project sourcing platform, not a lender, financial adviser or broker-dealer.
Can I attach the business case to an RFQ?
Yes. The RFQ button carries the planning inputs, payback and sector into your project brief for review. A modelled payback is not budget approval; confirm the USD project value, buyer authority and scope before submission.
Related: CapEx calculator · OPEX calculator · TCO calculator · Throughput calculator
From a planning result to a reviewable project
Test payback, NPV and IRR using documented investment and net-benefit assumptions. Compare downside cases before approving scope.
1. Define scope
Record capacity, site and package interfaces.
2. Confirm evidence
Document the source of net benefits, useful life and discount rate.
3. Human review
Buyer service is free for B2B projects from USD 250,000. No automatic supplier outreach.
What does this result not establish?
Positive NPV does not mean the budget is approved or financing is available. Calculator assumptions are not quotations, engineering approval or financing commitments.