If you need effective cost per employee or annual maintenance or annual savings and you already know cost and days of maintentance and employee salary (gross) and employees required and overhead and time to build and years to profit, this calculator does the substitution for you. It is built for quick answers, for checking somebody else’s arithmetic, and for the moments when a formula book is not within reach.
What Is the Build Vs. Buy Calculator?
It is built around effective cost per employee, annual maintenance, annual savings, and it works the same way whether you are checking a homework answer, confirming a colleague's figure, or working something out for yourself. Everything runs in your browser, so nothing you enter is uploaded anywhere.
How the Build Vs. Buy Calculation Works
The steps are applied in order, so an output that depends on another output updates as soon as the underlying figures change.
The relationship between cost, days of maintentance, employee salary (gross), employees required, overhead, time to build, years to profit and effective cost per employee, annual maintenance, annual savings, cost to build is fixed, so the same figures always give the same answer. That makes it a good cross-check: run the numbers a second way and see whether the result agrees.
Getting a Result You Can Trust
It is worth running the figures twice with slightly different inputs. A calculator that behaves sensibly will move its outputs by a proportionate amount; if a small change produces a wildly different answer, there is usually a unit or a decimal point issue somewhere in the inputs.
Frequently Asked Questions
What do I need to work out effective cost per employee?
Enter cost, days of maintentance, employee salary (gross), employees required, overhead, time to build, years to profit. The calculator then works through the relationship and reports effective cost per employee, annual maintenance, annual savings.
What does the build vs. buy actually calculate?
It takes cost and days of maintentance and employee salary (gross) and employees required and overhead and time to build and years to profit and converts them into effective cost per employee, annual maintenance, annual savings using the standard relationship for this problem. Each step is applied in turn, so every output is traceable back to the numbers you typed in.
How should I enter cost?
Use the value you actually have, in the unit shown next to the field. Enter every value in the same unit system. The calculator assumes the figures you supply are consistent, so it cannot correct a mistake that happens before the calculation starts.
Why does a small change in one value move the answer so much?
That happens when an output depends on a ratio, because dividing by a small number magnifies any change in it. Check the units first, then check whether the value you entered is in the range the relationship was designed for.
Can I use this for a quick estimate as well as a precise answer?
Yes. The calculator is built for quick checks, so round your inputs to a sensible number of significant figures and the result will be just as useful. If you need more precision, keep the same method and add digits to the inputs rather than adjusting the method itself.