Return on Investment ROI

One way of looking at the creation of shareholder value is to end the year with a lot more money than at the start. If this extra money results from profitable trading, then management has been successful in improving the productivity of capital. Return on investment (ROI) is measured as profit (in ) before interest and tax as a percentage of capital employed (also in )  

The term investment is used because capital employed is equivalent to the money invested in the business. ROI can also be seen as the outcome of profitability and asset utilisation  

Superior customer service improves sales, and makes our company more valued by the customer in the long term. 

Note that the combination of inventory, cash and debtors less creditors is called working capital. Each of the elements of working capital is considered in turn. 

This is a major asset in many businesses. It is there to buffer uncertainty of supply and demand, and to permit immediate availability when replenishment times are too lengthy. However, inventory is often regarded as a hindrance rather than a help it ties up cash, it needs resources to be stored and it becomes obsolete. 

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As a general rule, acquisitions are considered for estabHshed products with above-average growth potentials. Often, entry by acquisition is more timely and profitable than internal development and subsequent plant constmction. EoUowing the latter course might take 5 to 10 years, during which time the highest return on investment (ROI) is lost. 

Ca.pita.1 Investment ndReturns. Capital needs for commodity chemicals are usuaHy very high, hundreds of millions of doHars being needed for many petrochemical plants of economic size. Return on investment (ROI) and return on sales (ROS) vary widely. Capital needs of specialty products are usuaHy quite low, often about 50 to 600 per doHar of sales. ROI and ROS vary widely but are usuaHy higher than those for commodities. 

Return on investment (ROI) criteria can be defined by the general form ... 

There are various indicators to determine the measure of profit for a process. In the following, we describe two of these indicators return on investment and payout period. The rate of return on investment (ROI) may be calculated as follows ... 

Now that we have dealt with most exist factors, lets see whether the process is profitable or not. A key factor in industry is profitability regardless of technical achievement Objective procedures to aid such assessment are based on the return on investment (ROI) as the criterion. 

Return on Investment (ROI) Return on investment (ROI) is usually defined as the ratio of average yearly income over the productive life of the project to the total initial investment, expressed as a percentage. Thus, from Figure 2.2... 

Return on investment (ROI)—a simple yield calculation without taking into account the time value of money... 

Using a 260/wafer sales price for epitaxial silicon wafers and the United States MACRS tax-basis depreciation schedule, the investor s rate of return (IRR) is 18.3%. In addition, the return on investment (ROI) is 25.3%. These measures increase significantly with small changes in sales price for example, at 273/wafer, the IRR is 29.9%. Note that the economic analysis is somewhat shielded from variations in the price of epitaxial wafers because it is strongly linked to the price of the incoming polished wafers. In other words, the key metric of interest is the value added to the wafer by the epitaxial film deposition. 

VIP Flaiming and Implementation Each VIP has a unique character, and it should be performed at a certain time and in a certain way to produce the best results for the project. Part of the power of VIPs is that they can be used to improve the overall economics of the project without the need for inorclinate additional time or expense. Ironically the return on investment (ROI) for the cost of implementing each VIP is usually much greater than that ROI for the overall proposed project. For one engineering contractor, the typical ROI for... 

Figure 8.1-8. Return on Investment (ROI) for the compressor process of fish-oil fractionation at different solvent/feed ratios, depending on variable benefits per kg of product.

Prior to application of immunoassays for detection of antigens, it is important to do a cost/benefit analysis to establish whether it adds value as compared to other analytical techniques. The value of immunoassay depends on its (1) performance versus other analytical techniques, (2) ease of use, (3) type of environment i.e., on site or in the field, (4) cost, and (5) return on investment (ROI) (48, 79, 80)... 

Return on Investment (ROI) A measure of a company s profitability, expressed in percentage as net profit (after taxes) divided by total dollar investment. 

What is the cost-benefit ratio or return on investment There should be a clear advantage in terms of cost benefit and return on investment (ROI). For example, an investment of 100,000 in technology that generates an additional profit of 40,000 for a year would have a return on investment or an annualized ROI of 40 percent. If this rate continues over time, the initial investment would be recouped in 2.5 years. 

Return on equity, also known as return on investment (ROI), is a measure of how well the company can make profits from funds provided by owners or investors. High ROE levels are desirable because investors— similar to companies—are interested in maximizing their profits. ROA and ROE sometimes are used to gauge the manager s performance. All else equal, managers who make better financial decisions are better able to produce higher ROA and ROE ratios for their organizations. 

The plastics industry is comprised of mature practical and theoretical technology. Improved understanding and control of materials and fabricating processes (Table 3.2) have significantly increased product performances and reduced their variability resulting in good to excellent return on investments (ROIs).140... 

One of the significant problems for the Pharma industry is that of the 400 disease entities identified only 50 are commercially attractive by today s requirements of return on investment (ROI). Society needs to find a way to make more diseases commercially attractive if it wants Pharma investment in treating any of the other 350 diseases affecting hundreds of millions of people. 

The production cost of syncrude oil is estimated to be 179 per ton from a 100 000 ton/yr MPW (only) processing facility. An additional cost of 24 per ton is required to process MPW in a 100000 ton/yr facility. However, if the capacity of the plant is increased to 200000 ton/yr, the production cost decreases to 125 per ton thereby making the project slightly profitable with a return on investments (ROI) of 5.4% per year. 

Another simple measure of economic performance is the return on investment (ROI). The ROI is defined in a similar manner to ROA and ROE ... 

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