Cost Benefit analysis of Capex/Investment using NPV in Excel
Originally published: 15/02/2021 16:48
Publication number: ELQ-87950-1
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Cost Benefit analysis of Capex/Investment using NPV in Excel

Cost-Benefit analysis of Capex/Investment using NPV in Excel.

If you want to make an investment in machines you have to carry out a cost-benefit analysis that will help you decide whether the investments make sense. You will have to approach in different way different types of investments. In the presentation, you will find an overview of different types of investments and also you will have access to 5 examples of calculation of different investments done in Excel. Below an overview of the examples attached:
1. Replacement Investment – Furniture Production. In this example, we will calculate whether it makes sense to replace the forklifts that we have been using. New forklifts will have different costs
2. Required by customer investment – Food Industry. In the next example, we will analyze investment in the PET line required by the customer. We will see whether it makes sense or not given the volume of sales that we can expect thanks to these investments
3. Investment in bottlenecks removal – Plywood. When the investments you are doing will be done in a bottleneck, then you have to approach the calculations in a different way. In this case study, you will see how you have to take into account the potential benefits generated by the investment.
4. Cost reduction Investment – Retail. In this case study, we will analyze cost reduction investments. We will look at the introduction of LED lights that should help lower the costs in one of the retail chains
5. Cost reduction Investment – Ceramic Tiles. . In this case study, we will analyze other cost reduction investments. This time we will be looking at the benefit of machines that will help us reduce the number of people we need per 1 production line in a ceramic tile factory

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1 presentation, 5 Excel models

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  • Nitish A. Peters(last updated: 07/09/2021 20:23)
  • Bilal S.(last updated: 05/05/2021 19:48)


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