How to use it
- Use the formula below with your own figures.
The formula
ROI = (net profit ÷ investment) × 100%.
Worked example
$5,000 profit on a $20,000 project is 25% ROI.
Frequently asked questions
Include all costs?
Yes — count time and overhead.
Over what period?
State the timeframe for context.
Tips
- Know your break-even before scaling spend.
- Separate margin from markup when pricing.
- Discount future cash flows to value projects.
Key terms
- Break-even
- Where revenue covers costs.
- Margin
- Profit as a percent of price.
- NPV
- Discounted value of future cash flows.