SaaS Replacement ROI Calculator

How the SaaS Replacement ROI Calculator Works

The model has two phases, the same two phases every replacement engagement goes through. During the build phase (five months by default) you are still paying for the SaaS tool, and you are also paying for the replacement to be built. Nothing has been saved yet. Once the internal system is live, the subscription stops, the manual work it created goes away, and the monthly cost drops to ongoing management.

What each number means

Current 3-year SaaS cost is what you would spend if nothing changed. SaaS cost avoided is the subscription you no longer pay for every month after launch. Labor savings is the manual hours saved each month, times your average loaded hourly cost, for every month after launch. Managed system investment is the build phase plus ongoing management, added together across the three years.

Net value is avoided subscription plus labor savings, minus that investment. Return on investment is net value divided by the investment. The break-even month is the first month where cumulative savings catch up with what was spent during the build.

Be honest about hours saved

Hours saved is the input that moves the answer most, so it is the one to get right. Count the work the tool creates rather than the work it does: keying the same job into two systems, exporting to a spreadsheet to build the report the tool cannot, chasing a status by email because the workflow lives in three places, reconciling by hand at month end. A defensible twenty hours is worth more in a budget conversation than an optimistic sixty.

Where the default investment figures come from

The defaults are our standard rates: $4,995 a month during the build and $1,495 a month for ongoing management after launch, the same rates used on our Build vs Buy page. The five-month build phase is the middle of what the custom software cost calculator estimates for a typical scope (two core workflows, two integrations, data migration, and reporting), which comes out at 4 to 6 months. Real engagements vary with scope, so run yours through that calculator and put its timeline here. The assumptions above are editable if you already have a quote in hand.