Equipment Payback and ROI Calculator

Equipment should earn more than it costs. This calculator compares the total cost of a lease with the extra profit or savings the equipment is expected to produce, such as faster production, new jobs you can bid on, lower repair bills or reduced labor hours.

How it works: enter the total of all lease payments and fees, any tax savings or incentives that offset the cost (for example an estimated Section 179 or bonus depreciation benefit, which your accountant should confirm), the extra annual profit you realistically expect and its yearly growth rate. The tool subtracts offsets from cost to get net cost, then adds yearly benefits until the running total passes that net cost. That moment is the payback time.

Worked example (illustrative): a $100,000 lease cost, $20,000 of tax savings and $38,000 of added yearly profit gives a net cost of $80,000. With 2% growth, payback arrives a little over two years in.

Limits: the calculator does not discount future cash, does not model downtime or maintenance, and cannot judge how reliable your profit forecast is. Run a cautious version with the benefit reduced by a third. If payback only works in the optimistic case, reconsider the purchase.