TCO Analysis addresses

Time
Technology Costs
Pro
Recurring Costs
One-Time
Acquisition
Costs
People Costs

Process Costs
Year 1 Year 2 Year 3
One Time Acquation
Cost 500000 0 0
Process Cost 1000000 0 0
Recurring Cost 0 300000 300000
Training Cost 200000 0 0
Technology Costs 200000 0 0
Total cost 1900000 300000 300000 2500000
Benefits
Increase Sales Volume 1000000 1000000 1000000 3000000
ROI in 3 Years 20
The above table gives the cost benefit analysis of small size ERP
implementation. We have assumed the standard costs. One time costs
will include acquisition costs, implementation, training and hardware
costs. Service cost will be charged a fixed amount from next year
thereafter.
Risk is assumed to be low as it is small scale
implementation. Hence no additional costs.
Net increase in sales in 2013 will be around 1 %
because of business which was lost earlier due to
SMS and inventory problems.
Benefits increased will comprise of positive ROI in
3 years, inventory/accounting centralization,
increased customer service and automatic
issuance of daily centralized sales reports for
Navin.