Cost-Benefit Analysis Templates for Excel
Before undertaking a project or projects it is important to perform cost benefit analysis. If you don’t what is cost benefit analysis, it is basically the process of calculating the costs that’s going to be involved in executing a project and the benefits that you will get from your project if it succeeds.
The reason why this strategy is so important is that it helps you to see if your return on investment is going to be worth it. It will also help you to save back a lot of money. It prevents you from investing into a project that’s not going to have a great upside. This will then allow you to either invest into an alternative project or pour back that money into business operations.
If you want to implement this into your company Excel is great tool you can use to create a template. You can even do it in less than half an hour or ten minutes. It all depends on the complexity of the template. Below you can see tutorial on how to create a cost benefit analysis template in Excel.
Cost benefit analysis template in Excel step by step:
Load up Excel, and then look at the different areas of your project that you are going to analyze. This will help you to see if it’s the right investment. For this template you are going to start off with 3 columns, these will be named option 1, option 2 and option 3. In each of the column you will put a description of each project underneath from option 1 – 3.
On the far left you are going to now insert the following items in each column. Capital costs, whole life costs, present value of benefits, present value of costs, benefit cost ratio, net present value, labor and infrastructure.
Next fill out the different rows. Weigh the values against each other to see which one will have the most benefit and probably the cheapest to operate.
This is a simple tutorial you can use to see which project is the best one to invest your time, effort and money in. This template is very simple. But if you want to create a more sophisticated one you can get a lot of tutorials on the internet.
If you don’t have the time to learn Excel which can be time consuming. You can even take advantage of downloading a template off of the internet and use it. A lot of persons have used this method as well.
You also have a lot of amazing templates for unique preferences lurking around on the internet. In summary using the cost benefit analysis in your organization can really help you to predict the value of a project before it even started.
This will help you to see if your project is the right investment to undertake at a particular moment. It will also allow you to see if you have the right amount of resources and the proper infrastructure to take on a particular project. You can see an example of one below.