KEVOS® WORKOS · Projects
Business Case with NPV
Does this project make commercial sense?
Evaluates a project’s net present value, payback and robustness to a 20% benefit shortfall.
Open the calculatorRuns in your browser. No account needed.
How this tool works
Inputs, units and where to find them
| Input | Unit | Typical source |
|---|---|---|
| Initial investment | $ | Total initial cost from quotations and estimates |
| Annual benefit | $ | Annual benefit once delivered (savings or extra contribution) |
| Annual operating cost | $ | Annual operating, maintenance and licence costs |
| Assessment horizon | years | Assessment horizon (useful life or policy period) |
| Delivery risk | 1–5 score | Delivery risk rating (1 low, 5 high) |
| Discount rate (your approved rate) | % | Approved discount or hurdle rate from finance |
Method and formulas
- Annual net = benefit − operating cost
- NPV = annual net × annuity factor(r, n) − investment
- Downside NPV uses benefit × 0.8
- Discounted payback interpolated within the year
Limitations
- Level cash flows from year 1; no ramp-up or residual value
- Pre-tax
- Risk rating is not converted into money
Typical uses
- Capital and improvement project approval
- Comparing investments with different horizons
Who it is for
- Sponsors and business owners
- Project managers
- Finance partners
What you get
- STRONG CASE, POSITIVE BUT SENSITIVE or WEAK CASE
- NPV, downside NPV and paybacks
Interpreting the result
- STRONG means positive even with 20% less benefit
- High delivery risk calls for staged approval or a quantified risk allowance
References
- Brealey R., Myers S. and Allen F., Principles of Corporate Finance (McGraw-Hill)
WORKOS tools are screening and decision-support utilities. Verify important financial, engineering, safety, legal or operational decisions using appropriate professional standards and your organisation’s approved data.
