Return On Investment (ROI) Calculator
The DemandCaster® ROI Calculator helps predict the impact of a comprehensive demand and supply planning and inventory optimization initiative on your company's profit and cash flow.
Let's assume that the market sets the price for your products. If your company is one that struggles with managing demand and inventory optimally, you will typically realize the waste in three operational measures as compared to best-in-class companies in your industry:
- Inventory: Inventory $'s will be higher
- Productivity: Productivity and throughput will be lower.
- On Time Performance / Customer Service: Will be lower and stock-outs higher.
Fill in the calculator below with your companies numbers and objectives to project the impact in your operation.
- Current: Input the blue highlighted cells with your current business or product line financial and on time performance.
- Goals: Input the desired productivity improvement and inventory reduction you desire.
- Assumptions: Input your projected cost of inventory.
The calculator will calculate the projected impact of a comprehensive demand and supply planning and inventory optimization implementation. We assume productivity improvements will increase revenue by the same percentage with only the cost of material increasing. Labor and overhead assumed to stay the same. The reduction in inventory will generate both a cash flow savings and a P&L saving. The P&L savings is calculated by multiplying the cost of inventory against the total inventory reduction. The ROI is calculated based on both the cash and P&L savings generated.
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