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Return on Investment
April, 2002

Software can perform redundant tasks such as bookkeeping and inventory tasks, reducing the number of employees required.

P 200,000 – P 700,000 (for a small to medium sized enterprise)

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)

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).

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.