Odoo is an open-source software with a wide range of business applications that handle operations such as CRM, eCommerce, and other operations. Odoo can be split into two phases: implementation and results, with implementation being the most discussed one.
Implementation isn’t the only process you should focus on in Odoo. That is just the first phase. The ROI after Odoo implementation is the second and final phase. You should know what kinds of results are generated and how profitable they are for your business.
These results have a technical term, Return on Investment (RoI). It is a metric that measures the return on the investment made in the implementation.
How do you calculate this? What are the key metrics to track RoI? How to improve your RoI? Keep scrolling to know the answers to these questions from an Odoo partner in Dubai’s perspective.
What is ROI?
ROI means Return on Investment, an indicator showing the profit gained from an investment. This will give you insights into the cost savings, productivity gains, and revenue growth. Based on these insights, you’ll understand whether your investment has given the appropriate return.
ROI can be calculated with a formula:
ROI = (Gain from Investment – Cost of Investment) / Cost of Investment
An ROI gives you an understanding of the money spent on implementation and setup, and a comparison of the benefits received with the total investment.
Why Measure ROI After Odoo Implementation?
Measuring the ROI after Odoo implementation has four benefits:
- Tracks the change in productivity, efficiency, and daily operations.
- Analyse whether the money spent brings the estimated returns.
- Helps in optimising the future budgeting, upgrades, and expansion plans.
- Finds out where the performance peaks and where improvement is required.
Step-by-Step Guide to Calculate ROI
Calculate Total Investment Cost
In the first step, you have to add up the total investment cost. Make sure to include all expenses such as Odoo licensing, setup charges, customisation, training, and maintenance costs.
Identify Benefits
Find out whether Odoo has reduced your manual work and errors, and improved your productivity and sales.
Assign Monetary Value to Benefits
Here, the money should be converted into actual monetary values to measure ROI clearly.
Convert saved time into employee cost savings, faster sales processes or improved customer service into extra income earned, and fewer errors, less paperwork, and other benefits into operational cost reductions.
Apply the ROI Formula
The ROI formula helps you figure out how much return you have gained against how much you have invested.
ROI = (Gain from Investment – Cost of Investment) / Cost of Investment
This is the formula. Let’s substitute it with real figures.
Gain from investment (Total Benefit) = ₹8,00,000
Cost of Investment (Total Cost) = ₹5,00,000
(₹8,00,000 – ₹5,00,000) / ₹5,00,000 = 60% (ROI)
Key Metrics to Track ROI
Earlier in the blog, it was mentioned that ROI is a metric for measuring Odoo’s progress post-implementation. But ROI has its own metrics for easier tracking. They are:
- Productivity improvement – Shows how much easier and faster the workflow has become through automation.
- Cost Savings – Tracks how much cost has been saved from automating manual work, reducing errors, and using multiple tasks.
- Revenue Growth – The increase in sales, leads, and repeat business post-implementation.
- Customer Satisfaction – Check the response time, service quality, and how satisfactory the overall service is.
- Inventory Efficiency – Check the stock accuracy, faster movement, and lower wastage or overstocking.
Tips to Improve ROI from Odoo
If you’re feeling that your ROI is low, you can improve it in five ways: proper employee training, using updated models, constant updation, systematic performance tracking, and collaborating with experts.
Conclusion
An ROI after Odoo implementation is like a semester progress card. It gives you detailed insights into your productivity improvement, cost savings, revenue growth, and inventory efficiency. These insights will help you make better decisions for optimising your future workflow.
When you utilise Odoo’s tools the right way, you’ll get an impressive ROI. But utilisation alone won’t do the trick; systematic tracking and right partner collaboration are necessary.
That is where we come in, Commerce 9, an experienced Odoo ERP Customization Services in Dubai, will give you all the technical guidance and support for you to get the perfect ROI.
