The Hidden ROI of Software: Calculate Your True Return on Investment

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Hey there, welcome back to Elevated! I'm Brandy Lawson, and today we're talking money—specifically how to figure out if that shiny new design software is actually worth your hard-earned cash. 

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Episode Transcript

(00:05):
Hey there.
Welcome back to Elevated.
I'm Brandy Lawson, and todaywe're talking money,
specifically how to figure outif that shiny new design
software is actually worth yourhard earned cash.
But here's the thing.
Most kitchen and bath firms, andreally most businesses are
making these decisions based onsticker price alone.
I've witnessed owners strugglewith whether to upgrade

(00:26):
software.
Most fixate on the price taguntil we map out how much time
designers spend working aroundtheir current system.
In some cases, they were burningnearly$30,000 in billable hours
annually, just compensating fortheir hmm, crappy software.
Ouch.
Today we're looking at the realmath behind software investment.

(00:47):
Let's calculate the true returnthat goes way beyond the price
tag.
In the last episode, we talkedabout figuring out the true cost
of implementing new software.
Now we'll look at the benefitsside of the equation.
Start with the quantifiablegains.
Time savings.
How many hours per project willthis save?
And at what billable rate?

(01:08):
Next, error reduction.
What's the cost of mistakes thissoftware prevents?
Then look at capacity increase.
How many more projects can youhandle with the same staff?
For example, if new softwaresaved designers approximately
six hours per project onspecifications and renderings
with 45 projects annually, anddesigners billing at$125 an

(01:30):
hour.
That's over$33,000 in recoveredproductive time each year.
And that's without assuminggrowth of projects per designer
or additional designers.
But don't stop at the obvious.
What about the less tangiblebenefits?
Better visualization softwarecan increase your sales close
rate, improve projectmanagement, can boost client
satisfaction and referrals.

(01:51):
More accurate estimating toolscan protect your margins.
Let me walk you through a quickROI calculation for a real
kitchen and bath scenario.
Let's say you're considering newdesign software at$3,600
annually for three users.
Implementation will take about30 hours of designer time at$125
an hour, and 10 hours of admintime at$60 an hour.

(02:14):
That's 43 50 in implementationcosts.
On the benefits side, thesoftware reduces specification
time by two hours per projectwith 35 projects yearly.
That's 70 hours saved annuallyat$125 an hour.
Or 87 50 in recovered time.
Additionally, the software'smore accurate.

(02:34):
Renderings help you close threemore projects annually at an
average profit of$4,000 each.
That's another$12,000.
Year one ROI calculation costs$3,600 for the software, plus 43
50 for implementation equals$7,950.
So there's your cost.
Benefits 87 50 in time savingsplus$12,000 in additional

(02:57):
projects equals 20,750.
No, your net first year return,$12,800.
That's 161% ROI.
In subsequent years withoutimplementation costs, your
return jumps to over 575%.
So ready to crunch your ownnumbers.
Head to fire effects.com/choose.

(03:18):
To download the worksheet.
Remember, the goal isn't just tojustify a purchase you already
want to make.
It's to objectively evaluatewhether this investment truly
moves your business forward.
Sometimes the best ROI comesfrom investing in your existing
systems and team, rather thanadding something new.
Next week, we'll explore thesehidden benefits that don't

(03:39):
always show up in ROIcalculations, but can transform
your business nonetheless.
If today's episode helped youthink differently about software
costs, hit that subscribe buttonand share it with a fellow
design professional who'swrestling with software
decisions.