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Tool Cost vs ROI Calculator – Is This SaaS Worth It? - Free Business Calculator | ASK SMB
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Tool Cost vs ROI Calculator – Is This SaaS Worth It?

Free Tool Cost vs ROI Calculator. See if a SaaS tool is worth paying for based on time saved and revenue impact.

Tool Cost vs ROI Calculator

Stop wasting money on tools you don't need. Calculate if a SaaS subscription is actually worth paying for based on real value created.

Inputs

$

Monthly subscription price of the tool

Estimated time saved by using the tool

$

Value of one hour of your time or employee time

$

Additional monthly revenue generated by the tool

Results

Enter a tool cost to calculate ROI

How the Tool Cost vs ROI Calculator Works

Why SaaS ROI Matters

The average small business spends $10,000-$25,000/year on SaaS tools, and 30-40% of that spend is wasted on unused or low-value subscriptions. That's $3,000-$10,000 in annual waste.

Most founders and business owners subscribe emotionally ("this looks cool") or reactively ("we need this now") without calculating if the tool actually pays for itself. The result: subscription creep, bloated expenses, and tools that sit unused after the first month.

  • Subscription fatigue: Average business has 10-20 active SaaS subscriptions, many forgotten
  • Shiny object syndrome: New tools promise transformation but deliver incremental value
  • No accountability: Tools are rarely audited after purchase
  • Sunk cost fallacy: "We paid for a year, so we have to use it"

This calculator forces you to quantify value before or after subscribing. If the math doesn't work, cancel immediately.

Time Savings = Real Money

The #1 benefit of productivity tools is time savings. But time savings only equals money if you reinvest that time into revenue-generating activities.

Formula: Time Value

Time Value = Hours Saved × Hourly Value

Example: 10 hours saved × $50/hour = $500/month value

Critical caveat: If you save 10 hours but spend those hours on Netflix, the real value is $0. Be honest about whether you're reinvesting saved time into high-value work (sales, product development, strategy) or low-value work (email, Slack, meetings).

Tools that eliminate soul-crushing busywork (manual data entry, invoice formatting, repetitive emails) have hidden value beyond time savings: they prevent burnout, improve focus, and increase decision quality. Factor this in subjectively.

Revenue Impact vs Productivity Tools

Some tools directly generate revenue, others save time. Both create value, but revenue-generating tools are easier to justify:

Revenue-Generating Tools

  • Sales automation (outreach, CRM)
  • Marketing tools (ads, email, SEO)
  • E-commerce platforms
  • Payment processors
  • Analytics (conversion optimization)

Track revenue attribution directly

Productivity Tools

  • Project management
  • Accounting/invoicing
  • Design tools
  • Documentation
  • Time tracking

Calculate value via time savings

For revenue tools, use conservative estimates. If a tool claims "30% revenue lift," start with 10% and track actual results. For productivity tools, track before/after time spent on specific tasks over 2-4 weeks—don't guess.

What Is a Good ROI for Software?

This calculator uses a 200% ROI threshold for "Worth It" (tool pays for itself 2x). Why 200%?

  • Margin for error: Most people overestimate time savings by 40-60%. At 200% ROI, even if you're 50% off, the tool still breaks even.
  • Hidden costs: Setup time, learning curve, integrations, and troubleshooting aren't included in monthly price.
  • Opportunity cost: Money spent on a tool could be spent on other investments (hiring, ads, inventory).
  • Risk of churn: If the tool shuts down or raises prices 3x, you need a buffer.

ROI Benchmarks

  • 🟢 200%+ ROI: Clear winner. Buy it.
  • 🟡 0-200% ROI: Marginal. Consider alternatives or negotiate price.
  • 🔴 Negative ROI: Cancel immediately. No exceptions.
  • Exception: First 30-90 days may show negative ROI due to setup. Re-evaluate after ramp period.

How to Audit Your SaaS Stack

Run this audit quarterly to eliminate wasted spend:

  1. 1.List all subscriptions: Check your credit card statements for recurring charges. Most businesses forget 2-5 subscriptions.
  2. 2.Track usage: For each tool, log actual usage over 2 weeks. If you haven't logged in 10+ days, you don't need it.
  3. 3.Calculate ROI: Use this calculator for each tool. Be conservative on time savings.
  4. 4.Find alternatives: For borderline tools, search "[tool name] alternatives free" or "[tool name] cheaper."
  5. 5.Cancel immediately: Don't wait until the renewal date. Cancel now, you'll still have access until the end of the billing period.
  6. 6.Consolidate: Can 3 tools be replaced by 1 more powerful tool? (e.g., replace email + calendar + CRM with single platform)

Pro tip: Set calendar reminders to review this calculator before every renewal date. Tools that made sense 6 months ago may no longer be worth it.

Example Calculation

Let's walk through a real-world example:

Scenario

Tool cost:$49/month
Hours saved:10 hours/month
Hourly value:$50/hour
Revenue impact:$200/month

Calculation

Time Value = 10 hours × $50 = $500

Total Monthly Value = $500 + $200 revenue = $700

Net ROI = $700 - $49 = $651

ROI Percentage = ($651 ÷ $49) × 100 = 1328%

Decision

🟢 Worth It

This tool creates 1328% ROI, paying for itself 13x over. This is an excellent investment that clearly justifies its cost. Even if your time estimate is 50% off, it's still a 6x return.

Frequently Asked Questions

A SaaS tool is worth it if it generates an ROI of at least 200% (pays for itself 2x over). Calculate the value by: (1) Time saved × your hourly rate, plus (2) Any additional revenue the tool generates. If that total exceeds the tool cost by 2x or more, it's a clear yes. Between 0-200% ROI is borderline—the tool pays for itself but marginally. Negative ROI means cancel immediately. For example, a $50/month tool that saves you 5 hours at $40/hour ($200 value) creates 300% ROI—clearly worth it.

💡 Quick Tips

  • All calculations happen in your browser - your data is private
  • Results update in real-time as you type
  • Export to PDF or share via link
  • No sign-up required

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