Understand Your ROI from the Very First Years with HIPE
As a packaging manufacturer, you likely work with an ERP system, Excel spreadsheets, and emails—and you’re in your comfort zone. Adding a new tool to your software environment might certainly disrupt that balance, but it could also open up new opportunities that have remained unexplored due to your teams’ lack of time.
Investing in HIPE, our AI-powered tool specifically designed for packaging companies like yours, could deliver a return on investment as early as the first year.
In this final installment of our “How-To” blog series, we explain how your return on investment (ROI) can be achieved as early as the first year, by reviewing the calculations for the Configure, Price, Quote (CPQ), CRM, and Project Management modules. To learn more and examine these calculations in detail, feel free to check out the articles for each module.
Details on HIPE's ROI Gains in CPQ, CRM, and Project Management
Let's take the example of Company A :
A medium-sized corrugated cardboard converter located near Bordeaux, France. Expected revenue of approximately 10 million euros. The company typically generates 15,000 quotes per year thanks to a large sales team and regularly attends major packaging trade shows.
At Packitoo, we know that it takes time to realize the benefits of implementing new technology and processes. It’s difficult to expect to achieve all of these benefits, especially in the first year.
Let's imagine instead that these gains are achieved in the following way:
- Year 1: 33% of total earnings
- Year 2: 66% of total earnings
- Year 3: 100% of total earnings
This gives Company A the following calculations:
| Winnings | Year 1 | Year 2 | Year 3 |
|---|---|---|---|
| CRM | 58 872 € | 117 744 € | 178 400 € |
| GP | 111 969 € | 223 938 € | 339 300 € |
| CPQ | 128 832 € | 257 664 € | 390 400 € |
| Total | 299 413 € | 599 346 € | 908 100 € |
Cost per module
Reminder of the assumptions:
- Number of sales representatives / sales assistants: 8
- Total number of team members (design office / methods / production, including prepress): 11
> That is, 3 people, excluding sales representatives and sales assistants
Note: Installation, MIS/ERP integration, and training costs are factored into the cost only in the first year.
| Cost | Year 1 | Year 2 | Year 3 |
|---|---|---|---|
| CRM + GP Cost | 24 168 € | 7 668 € | 7 668 € |
| CPQ Cost (CRM Add-on) | 20 652 € | 5 652 € | 5 652 € |
| Total | 44 820 € | 13 320 € | 13 320 € |
ROI by module
Since ROI is calculated using the formula (Gains – Costs) / Costs, HIPE’s cumulative results would be as follows:
| ROI | Year 1 | Year 2 | Year 3 |
|---|---|---|---|
| CRM / GP | 607 % | 4 356 % | 6 651 % |
| CPQ | 524 % | 4 459 % | 6 807 % |
| Total | 569 % | 4 400 % | 6 718 % |
Impact on EBITDA, a financial metric measuring the profitability of industrial operations
The impact on Company A’s EBITDA—which currently stands at €500,000, or 5% of its annual revenue—would then increase by €908,100 in Year 3 following the deployment of the HIPE solution, with revenue of nearly €10,000,000.
This represents an EBITDA-to-revenue ratio that rose from 5% to 14%, an increase of 9 percentage points in EBITDA.
Why not calculate your HIPE ROI today using your own numbers?
Our online tool lets you automatically calculate your HIPE ROI in just a few clicks: Simulate my ROI now.
As a reminder, our calculator provides you with your estimated savings (time + margin), your ROI over the first three years following the deployment of HIPE, and a clear report to share with your teams.
We created HIPE to help you turn your quotes, clients, and projects into measurable results. And now, you can quantify those results yourself.
For more information about HIPE or any of its modules, contact our team today.