LED systems costs are justified on two bases, application needs, income or revenue increase. Following is a typical LED System cost justification based on revenue impact.
LED SYSTEM
Cost Justification Worksheet
Using Daily Traffic Count Study
- The average daily traffic past my location is: _____ vehicles per day.
- The ads I run on my LED display should attract _______ percent of that daily traffic or __________ customers per day.
- My average customer order amount is $ _________.
- Multiply the number of customers per day by your average customer order amount for example: 5 customers per day X $100 average customer order = $500 per day
- Multiply line 4 by the number of days your location is open per year for example: $500 X 260 days open per year = $130,000 per year. Write that total here: $___________
- The total cost of the LED display system is $__________.
Other revenue impact bases may include venue and advertising contract agreement that can be used to justify the amortized LED system cost over its ownership term.