Take on a big new customer

On these figures, the costs are larger

On these figures the costs come to $136,600 more than the gain.

• On paper it is worth $900,000 over 3 years.
• What it costs comes to $1,036,600: every $1 of gain costs $1.15.
• It looks good for the first 2 months and turns negative in month 4.

This is a worked example with illustrative figures, not data about any real person or company. Change any of them in the calculator and the answer changes with them.

How this answer was worked out

Every formula is written out on the formulas page.

What the calculator asks you

• The expected gain each year
• The one-time cost of making the change
• What the thing being changed was earning
• How much of it is affected, and how much of that was truly spare
• Which parts of the business rely on it
• The chance of having to undo it

Related

• Launch a second productWorked example
• Open a second locationWorked example
• The cost of savingThe calculator this example comes from
• Before you decideA checklist of what is worth checking first