CAPEX business case

Enter the investment by line, the annual benefits by type (labor, defects, added contribution margin, other), the running costs it adds, and the assumptions finance will ask about: life, depreciation, salvage, tax rate, discount rate, start-up ramp, and growth.

The sheet returns the measures an investment committee expects: simple and discounted payback, ROI, NPV, IRR, profitability index, and the break-even annual benefit. A tornado chart shows which assumption moves the answer most, and conservative, base and aggressive scenarios show the range. The capital request summary prints on one page.

Conventions: end-of-year cash flows (a fractional last year is prorated and discounted at that fractional year), straight-line depreciation to salvage, and tax on the net benefit with the tax shield used elsewhere in the business. Count added contribution margin as a benefit, not added revenue. It is decision support, not financial advice; confirm rates and tax treatment with finance.