The ROI of professional costing software – How investments in transparency and efficiency pay off

Many industrial companies follow a recurring pattern: processes are digitised, production lines optimised, supply chains restructured – but costing often remains the poor relation of digitisation. While modern machines deliver data in real time and ERP systems are highly networked, in many places quotation and product costing is still based on scattered Excel files, individual experience and manual coordination. The result is high costs, inconsistent methods and a considerable risk that decisions will be based on incomplete or inaccurate information.

This is exactly where professional costing software comes in. It not only creates transparency about costs and expenses, but also establishes a reliable basis for business decisions – from quotations and production to strategic planning. The key question that decision-makers ask themselves is: Is the investment worthwhile? The answer to this question is provided by the ROI – and with a professional costing solution, this is often significantly higher than many companies expect.

The term return on investment (ROI) is a key indicator when it comes to evaluating the economic benefits of an investment. Essentially, ROI describes how much revenue or savings an investment generates in relation to its costs. In industry, it is used to compare projects, machines, digitalisation measures or software implementations.

When introducing professional costing software, however, the benefits are not limited to direct cost savings – rather, the value unfolds through increased efficiency, process stability and strategic transparency. While a new machine delivers immediately measurable production hours, costing software acts as an enabler. This means that it improves decisions, accelerates processes and minimises error costs that often lie dormant in processes unnoticed.

In this case, the ROI can still be clearly quantified if both the hard factors (time savings in quotation preparation, lower post-calculation costs, higher hit rate in sales, fewer miscalculations) and the soft factors (higher data quality, faster coordination between departments, knowledge transfer, employee satisfaction) are taken into account.

Even more important than the pure figures, however, is the sustainability of the benefits. While short-term savings can also be achieved in other ways, a professional costing solution offers long-term leverage: it creates a robust, scalable basis for future growth and for decisions based on valid data rather than estimates.

Before the benefits of costing software can be quantified, the investment side needs to be clarified. Many companies underestimate or overestimate the effort involved in implementation. In practice, however, it has been shown that the costs are easy to plan – and are usually much lower in relation to the achievable benefits than initially assumed.

The most important cost blocks can be divided into four categories:

Pricing structures vary significantly depending on the provider and delivery model (cloud or on-premise). Cloud solutions are usually offered as software-as-a-service (SaaS) – with monthly or annual fees per user or feature set. They offer the advantage of lower initial investment and automatic updates. On-premise solutions, on the other hand, require a higher one-time investment for licences and IT infrastructure, but grant more control over data and systems.

The software licence itself is only part of the investment. For the system to function optimally, master data, calculation logic and interfaces to other systems – such as ERP, PLM or CAD – must be set up. This step is crucial to avoid media breaks and automate data flows. The effort involved depends heavily on the existing IT landscape and the complexity of the products. An experienced implementation partner not only ensures technical integration, but also technical adaptation to the company's calculation methodology.

Even the best software is of no use if it is not actively used. Training is therefore a key success factor. Employees from sales, controlling and work preparation must understand how the costing software works, which inputs are crucial and how to interpret the results. Change management also plays a major role: calculation is a sensitive area where experience and trust count. Transparent communication and targeted training help to build acceptance and ensure a smooth transition.

As with any business software, there are regular costs for maintenance, support and further development. These ensure the stability of the system, the up-to-date status of the calculation logic and underlying databases (e.g. in the event of material price changes) and access to new functions. With cloud solutions, these services are usually included in the usage fees. With on-premise systems, they are incurred as separate maintenance contracts. Overall, the costs for professional costing software are manageable, predictable and quickly amortised when compared to the benefits at the process and decision-making level. The decisive factor is not how much the software costs, but how much it achieves – and this is precisely what becomes apparent in the next step when looking at the revenue side.

While the costs of costing software are usually apparent at first glance, its full benefits often only become apparent in daily use. The real effects lie in the combination of time savings, greater accuracy, process reliability and better decision-making quality – factors that have a direct or indirect impact on a company's bottom line.

The following section explains the key revenue levers that can be used to demonstrate the ROI of professional costing software in concrete terms.

In many industrial companies, a significant portion of the working time of engineers and sales staff is spent on preparing quotations. Complex product variants, manual calculations and repeated queries between departments lead to long throughput times.

Professional costing software can significantly speed up these processes:

• Recurring items can be calculated automatically.
• Parts lists and work steps are transferred directly from ERP or CAD systems.
• Calculation templates enable standardised, traceable quotations.

Result: The time from receipt of the enquiry to the quotation being ready for dispatch can be significantly reduced. This means faster responses to customer enquiries and thus a higher chance of orders being placed.

Precise calculation creates the basis for realistic and competitive prices. Underestimated costs or incorrectly assessed material costs often lead to margin losses that only become apparent in the post-calculation.

Professional costing software prevents these errors by making current cost structures, wage rates and material prices centrally available and automatically incorporating them into the calculation. This ensures that every quotation is not only technically correct, but also economically sound.

The result: higher quotation quality, fewer renegotiations and a noticeably more stable profit margin across all projects.

As product complexity increases, many companies lose track of their real cost drivers. Professional costing software creates transparency here by clearly structuring all cost components – from individual parts to overheads.

This transparency has several advantages:

• It enables targeted cost optimisation.
• It forms the basis for strategic pricing decisions.
• It builds trust with customers and internal stakeholders.

In the manufacturing industry, this clarity is worth its weight in gold: only those who know their costs precisely can compete internationally with reliable prices.

In addition to clearly measurable efficiency and cost advantages, costing software also offers a number of indirect but strategically highly relevant additional benefits. These effects are not always immediately measurable in monetary terms, but they make a decisive contribution to ensuring that the investment pays off in the long term.

In many companies, cost calculation is a challenging balancing act between accuracy, time pressure and incomplete information. When this process is supported by intuitive software, it reduces stress and the likelihood of errors. Employees gain confidence in their results because calculations are traceable and reproducible. At the same time, the tedious search for current data or old versions is eliminated. The result: greater security, less frustration and higher job satisfaction.

Modern costing software acts as a shared data platform for sales, controlling, purchasing and production. Instead of separate Excel files, all parties involved access the same, up-to-date database. This avoids misunderstandings, shortens coordination times and promotes a common understanding of costs, prices and margins. As a result, calculation is no longer seen as an isolated task, but as an integral part of the entire value creation process.

In volatile markets, material prices, wages and energy costs often change within a matter of weeks. Companies that have digitised their costing can respond to these changes in real time. New price structures or cost rates are adjusted centrally and immediately affect all current offers. This allows companies to actively control their pricing strategy instead of reacting to cost increases.

Another "soft" ROI comes from preserving and documenting specialist knowledge. When calculation logic, empirical values and project data are stored in the system, they remain available to the company – regardless of personnel changes. This is a significant competitive advantage, especially in industries with a shortage of skilled workers. Professional costing software ensures that knowledge is no longer stored solely in people's heads, but in processes and structures.

An often underestimated effect: quotations based on clearly comprehensible calculations appear more professional and credible. Customers recognise that prices are well-founded – this strengthens trust and reduces price discussions. Transparent calculation thus not only creates internal efficiency, but also enhances the company's external reputation.

For the investment in costing software to really pay off, it is not only important to find the right solution – but above all to consider how it is introduced. Many companies underestimate the organisational aspect of such a project. However, if you take a few key success factors into account, you can significantly accelerate the ROI and ensure long-term acceptance within the company.

The introduction should be iterative. Instead of digitising all processes at once, a step-by-step approach is recommended – for example, starting with a pilot area or a product line. This allows you to gain experience, make adjustments and highlight quick wins. A clearly defined proof of concept builds trust among employees and decision-makers and reduces project risks.

Cost calculation affects several departments: sales, controlling, work preparation, purchasing and IT. Involving the relevant parties from the outset avoids friction losses and ensures that all relevant requirements are taken into account. In addition, an interdisciplinary project team promotes acceptance of the new solution – especially if key users are actively involved in its design.

Costing software is only as good as the data it works with. That is why a central focus should be on maintaining and harmonising master data – especially for material prices, working hours and overhead surcharges. Investing in clean data pays off immediately: it reduces queries, speeds up the process and makes results more reliable.

Technology alone rarely leads to success. For the new software to reach its full potential, employees need to understand why the calculation process is changing and how they themselves will benefit from it. Targeted training, practical training courses and an open communication strategy are essential. When calculators experience that the new system makes their work easier rather than more difficult, acceptance automatically increases.

Only what is measured can be controlled. To evaluate the ROI, specific key performance indicators should be defined before implementation, for example:

• Average quotation turnaround time
• Number of miscalculations
• Project margin compared to preliminary calculation
• Software usage rate

These KPIs serve as an objective basis for visualising success and making adjustments where necessary.

An experienced implementation partner not only brings technical expertise to the table, but also an understanding of processes. In industry in particular, it is important that the provider is familiar with industry-specific requirements – from the wide variety of variants in mechanical engineering to project costing in plant construction. The interaction between software, data and methodology ultimately determines how quickly the investment pays off.

In an age of shrinking margins, fluctuating markets and ever faster decision-making, costing has long been more than just a numbers game. It is the foundation of economic stability and strategic capacity to act. Professional costing software makes this foundation resilient: it creates transparency about costs, standardises processes and ensures that companies know at all times which orders are profitable – and which are not.

The return on investment is not only measured in terms of hours saved or reduced miscalculations. Above all, it is reflected in the new quality of decisions based on consistent, up-to-date and traceable data. Companies gain speed, security and confidence – both internally and externally.

Investing in modern costing technology today means investing in much more than just a software solution. It is an investment in transparency, efficiency and future viability.