Return On Investment (ROI)

Return on Investment (ROI) (also referred to as the Rate of Return or Rate of Profit) is a simple financial indicator to evaluate the efficiency of an investment or to compare the efficiency of a number of different investments.


ROI is a measure of the money gained from an investment compared to the amount of money invested.


ROI = (gain from investment - cost of investment) / cost of investment


This indicator is included in the book: Key Performance Indicators - the 75+ measures every manager needs to know, which contains an in-depth description of this KPI, as well as practical advice on data collection, calculations, target setting, and actual usage.

Back to our Key Performance Indicator Library

View the most insightful and relevant Key Performance Indicators in your business area.

Connect with Bernard Marr