How to Calculate SaaS ROI (Without Vendor Spin)

The two numbers that matter for any software purchase are payback period (in months) and annual ROI %. Everything else is window dressing.

The formula

ROI % = (Total annual benefit − Annual cost) ÷ Annual cost × 100. Total annual benefit is the sum of time-savings value (hours saved × loaded hourly rate × users × 52 weeks) and revenue lift attributable to the tool.

The honest version

• Use a fully-loaded hourly rate, not base salary ÷ 2,080.
• Only count hours that flow into billable or strategic work. Recovered hours that turn into Slack don't count.
• Discount year-one benefits by 30–50% for onboarding ramp.

Try it

The SaaS ROI Calculator runs all of this in seconds.