← Back to glossary Category: Financiar Payback period Quick answer: The time it takes for the savings or gains from an investment to cover its initial cost. Key takeawaysIgnores benefits after the recovery pointIgnores the time value of money (see NPV)Best used alongside ROI and NPV What payback period is Payback period is the time until an investment's cumulative benefits equal its initial cost. If a project costs €60,000 and saves €10,000/month, the payback is 6 months. Why it matters to the board Payback is the most intuitive decision criterion: how fast do I get my money back? For operational software, a payback under 12 months signals a low-risk, fast-impact project. Limits to keep in mind Ignores benefits after the recovery point Ignores the time value of money (see NPV) Best used alongside ROI and NPV How Azuvio helps Because Azuvio layers over existing systems (no rip-and-replace) and goes live in days, not months, the typical payback is short: savings from manual labor and avoided errors start immediately. Frequently askedIs payback period the same as ROI?No. Payback measures how long to recover the investment; ROI measures the total return generated. They are used together.What payback is considered good?For B2B operational software, under 12 months is very good; under 6 months is excellent. Where Azuvio fitsSoftware OMSConectori ERPSoftware WMS Related termsROI (Return on Investment) — The metric measuring the net gain of an investment relative to its cost: (benefit − cost) / cost.Net Present Value (NPV) — The value today of all an investment's future cash flows, minus the initial cost, discounted at a chosen rate.Internal Rate of Return (IRR) — The discount rate at which an investment's net present value (NPV) becomes zero — the project's intrinsic return.Total Cost of Ownership (TCO) — The sum of all costs of a solution over its full life: acquisition, implementation, operation, maintenance and replacement. Last updated: 2026-07-06