Quantifying the ROI of a trade compliance automation initiative requires a clear understanding of both the investment and the returns. Many projects fail to gain approval simply because stakeholders can’t tie efficiency gains to financial impact.
To build a compelling business case, organizations should take a structured approach:
Steps to Determine ROI Metrics
1. Define Scope and Objectives
- What processes are being automated (e.g., classification, screening, FTA qualification)?
- What are the desired outcomes (e.g., time savings, error reduction, audit readiness)?
2. Identify Direct Costs
- Software and implementation fees
- Infrastructure or integration costs
- Initial and ongoing training
- Maintenance, upgrades, and licensing
3. Identify Indirect Costs
- Manual labor hours
- Downtime and delays
- Penalties or rework from non-compliance
- Opportunity costs from delayed innovation or slow throughput
4. Estimate Efficiency Gains
- How many hours will automation save?
- What percent of error reduction is expected?
- How much faster can goods be cleared?
5. Project Financial Impact
- Translate time and risk reduction into dollar values
- Include avoided penalties or duties from correct classification or FTA use
6. Calculate ROI
- ROI=(Total CostNet Benefit (Gains – Costs))×100%
7. Validate with Post-Implementation KPIs
- Track real-world savings and improvements after deployment
By taking these steps, organizations can clearly articulate the financial value of trade automation—and make informed investment decisions grounded in measurable outcomes. To learn more and/or request ROI business case software, please contact KYG Trade.
AAEI thanks Todd and KYG Trade for presenting on this topic at our conference in June. Pre-Sale Registration is available for AAEI’s 105th Annual Conference, happening June 24-25, in Washington, DC. For more information and to register, please visit https://bit.ly/4eLv81q.
