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Return on Investment
April, 2002
SOFTWARE
Software can perform redundant tasks such as bookkeeping and
inventory tasks, reducing the number of employees required.
Cost
P 200,000 P 700,000 (for a small to medium sized enterprise)
Benefit
Reduce 3 manpower positions (bookkeeper, AP clerk, Inventory clerk)
P 500,000 / year
Better record keeping, less stealing risk P 100,000 / year
Better inventory and cash flow management P 100,000 / year
Total cost saving P 700,000 / year ($ 14,000 USD)
ROI
Return on investment can be realized within the first year or less.
Succeeding years will yield cost savings of P 700,000 / year (based
on above assumptions).
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WEB SITE
Initial cost of a Web site (design fee) may cost P 5,000 P
100,000 depending on requirement. The maintenance fee per year may
cost P 2,000 P 20,000.
Business (small to medium size)
Initial cost of Web site: P 10,000
Yearly cost: P 2,000
With such small investment of P 12,000 for the first year, it is not
hard to get a good ROI on the investment. If a company makes a net
income of P 12,000 per item sold, ROI would be realized by just
having one person buy one product through the Web site.
Consultation
As a freelance IT consultant, I help companies use IT to achieve
business goals such as reducing operating expense and increasing
sales and profits. My contact information can be found here.
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