38 Effective Cost Benefit Analysis Templates – Examples

Before investing in a project, it is crucial to determine whether or not it is viable. Making timely determination helps save companies and businesses valuable time and money. Next, a careful analysis should be conducted using certain tools to provide the organization with a clear picture of the effort, time, and money required to implement the project. The cost-benefit analysis is one such tool.

What is a Cost Analysis?

A cost analysis focuses on the cost of any given decision, project, or action without considering what the total outcome will be. This type of analysis is the first step you would take before doing the other 3 economic evaluations to see if it is feasible or suitable for the company. It’s a process that many businesses utilize faced with a decision.

Organizations use cost-benefit analysis to examine and compare projects, decisions, or systems against the profit, benefits, or opportunities they offer. It, therefore, adds up the benefits of the course of action involved and compares them with the cost associated with it. To conduct calculations, a dollar amount must be assigned to every cost and benefit. The benefits are then subtracted to help form a picture of the financial profits the organization aims to gain and determine if business objectives and goals will be met. An analysis also enables organizations to determine if a project or decision is worth pursuing.


We provide free downloadable templates, which are easy to use. They will help ensure that you remain focused on the task at hand, which in this case is conducting an analysis. They also help speed up the process of filing your analysis details.

Printable Cost Benefit Analysis Template 01 for Word File
Free Cost Benefit Analysis Template 02 for Excel File
Printable Cost Benefit Analysis Template 03 for Excel File
Professional Cost Benefit Analysis Template 04 for Excel File
Editable Cost Benefit Analysis Template 05 for Excel File
Free Cost Benefit Analysis Template 06 for Excel File
Professional Cost Benefit Analysis Template 07 for Excel File
Editable Cost Benefit Analysis Template 08 for Excel File
Free Cost Benefit Analysis Template 09 for Excel File
Professional Cost Benefit Analysis Template 10 for Excel File

    Free Cost Benefit Analysis Template 11 for Word File

    Editable Cost Benefit Analysis Template 14 for Excel File

    Printable Cost Benefit Analysis Template 13 for Excel File

    Editable Cost Benefit Analysis Template 12 for Excel File

      Historical Aspect

      The cost-benefit analysis was created in the 1840s by  Jules Dupuit, a French economist and engineer. Though it was used for government projects and infrastructure, any business can use it today. To attain an accurate analysis, tangible factors should be used. Assigning a monetary value to benefits is difficult as revenue is unpredictable and, at times, intangible. Other factors like project supporters that need the data to back up the project may also influence the outcome. Hence, monetary value is often assigned to cost rather than a benefit.

      Why Do You Need It?

      There are a few clear reasons why a template should be created. Understanding why it is needed will help ensure that businesses use it effectively. Other than helping a business decision as to whether or not to invest in a project, a template also does the following:

      •  It helps businesses explore several paths to implement a project
      •  It helps the business run several analyses at the same time.
      • The business can obtain more data to help in the decision-making process.
      • It supplies significant decision-makers in the company with information that helps them come to well-measured choices.
      • It helps businesses mitigate the risks associated with implementing expensive projects.

      How does CBA Work?

      An analysis examines the potential cost and revenue that a business may generate from a project. Using this data, the business can determine whether or not the project is financially feasible. If not, the business may then consider pursuing another project. This decision can be made based on the opportunity cost factored into the analysis. Opportunity costs are the benefits that can be realized as a result of choosing one course of action over another. It ensures that it is thorough by considering all options and potential opportunities missed. Therefore, the analysis facilitates a better decision-making process within the business.

      When and Who Should Use It?

      A cost-benefit analysis is conducted before a project begins to gauge factors such as the scope, success criteria, risk, among others associated with the project. It can also be used after the implementation of the project to analyze the impact of the course of action taken within the project. Finally, the template can be used whenever a business is unsure if the path chosen to implement the project is in its best interest.

      How to Conduct?

      Conducting a proper analysis is key to attaining precise, accurate results. A well-outlined process can help ensure that an effective process is followed.

      The following steps should be used when conducting an analysis:

      Establish a framework for analysis

      First, establish a framework by identifying the goals and objectives that need to be accomplished for project success. Next, identify the cost and the benefits and choose a metric to be used for the comparison. These details should be included in the template that will help in the interpretation of the analysis.

      Identify your costs and benefits

      Next, identify two lists of the cost and benefits. Brainstorming helps identify the costs associated with the project, such as payrolls, equipment, travel costs, and other possible monetary expenses. Creating separate categories will ease referring to the details outlined.

      The following categories should be used:


      There are five types of costs that should be highlighted in the cost category. Understanding each type will help ensure that adequate details are outlined when indicating these costs. They also ensure that the business takes all aspects of the cost of the project into consideration.

      The following types of costs should be highlighted:

      Direct costs

      These are incurred due to their association with the project or activity. They may include labor, material, manufacturing or production, and inventory. Usually, these costs are the easiest to identify in the CBA.

      Indirect costs

      These are fixed expenses. It means that these are incurred throughout the project or the running of the business. For example, they may include rent, utilities, and overhead costs associated with the management of the business.

      Intangible costs

      Intangible costs are the ones that are difficult to identify or measure. They are more qualitative than quantitative. For instance, a shift in customer satisfaction due to changes in customer service delivery or a shift in productivity levels.

      Opportunity costs

      Opportunity costs incurred when a business loses benefits or opportunities due to pursuing one course of action over another, such as choosing to build something over buying it or making alternative investments.

      Cost of potential risks

      These arise due to possible issues that may arise during the project. They may include any issue caused by environmental factors etc.

      Benefit categories

      The list should also contain a separate category outlining the project’s benefits. The benefits can be divided into four groups in the analysis template. The groups help ensure that the business understands what it aims to gain.

      The following groups should be highlighted:

      Direct benefits

      Direct benefits are gains made directly resulting from the implementation of the project, such as increased sales or revenue resulting from a new service or product.

      Indirect benefits

      Indirect benefits are gains or returns measured by customer interest in the brand product or service. Just like indirect costs, these gains are qualitative.

      Intangible benefits

      Intangible benefits are not explicitly measurable. They cannot be directly or solely identified through the project’s results or process. For example, improved team morale.

      Competitive benefits

      Competitive benefits are gains that give the business an advantage over its competitors. For instance, when a business is the first to progress to the top in the industry.

      Assign a value to each cost and benefit

      A value should then be assigned to each of the costs and benefits. Use the same ‘common currency’ during this process. Often a dollar amount or value is assigned to each cost and benefit. Though direct costs and benefits can easily be assigned this value, indirect and intangible ones may be difficult to quantify. Several software options and methodologies are available to help assign less than evident values to these types of costs and benefits.

      Tally the total value

      Tally the total costs of each of the costs and benefits from the analysis. If the business benefits outnumber the cost, then the project or decision is worth pursuing; however, if the results show that it outweighs the benefits, consider an alternative decision or project. Revisit the framework to help find reductions that can be made for the project to be more affordable and practical.


      Finally, make a careful comparison of the total costs and benefits outcome. Review the analysis to ensure all costs and benefits have been included in it. Consider a clear timeline for how long it may take the benefits to repay them. Careful consideration should also be placed on whether the project is a sound investment and whether the business is willing to set aside the time and resources required to execute it.


      Organize your costs in a way that reflects how you want your analysis to be presented and used.

      This infographic is to maximize the effectiveness of CBA Process.
      This infographic is to maximize the effectiveness of CBA Process.

      CBA Examples

      Free Cost Benefit Analysis Example 01 for Excel File

      Printable Cost Benefit Analysis Example 02 for Excel File

      Professional Cost Benefit Analysis Example 03 for Word File

      Printable Cost Benefit Analysis Example 04 for Excel File

      Editable Cost Benefit Analysis Example 05 for Excel File

      Downloadable Cost Benefit Analysis Example 06 for Excel File

      Professional Cost Benefit Analysis Example 07 for Excel File

        Advantages and Disadvantages

        A cost-benefit analysis is relatively easy and straightforward to conduct. However, there are advantages and disadvantages associated with conducting it. Businesses must evaluate and decide whether conducting the analysis is worthwhile.

        The  advantages and disadvantages of preparing a cost-benefit analysis include the following:


        Small to mid-level capital expenditure projects and short to mid-level completion time projects require the analysis for sensible and well-informed decisions to be made. However, large projects require capital budget analysis methods such as net present value (NPV). NPV states that present-day cash flow is more valuable than future cash because present money can be considered invested and earned income. It uses an alternative return rate that could be earned if the project is not executed. NPV is calculated by estimating future cash flow and determining the correct return rate.

        The following are pros associated with using the analysis:

        It is data-driven

        It is data-driven, facilitating an evaluation that is unbiased and opinion-free in terms of evaluation. It helps enable the business to evaluate and compare based on facts and evidence. The data-driven nature also ensures that actions are carried out based on logic.

        It makes decisions simpler

        This analysis simplifies the project by breaking down costs and benefits, making it easy to make vital business decisions. Through the simplicity, information is broken down into fathomable chunks enabling decision-makers to arrive at an informed decision.

        It can uncover hidden costs and benefits

        Cost and benefits can also be uncovered due to the extensive evaluation and identification process. Businesses should ensure that the process of identifying the costs and benefits is carried out thoughtfully by brainstorming within the organization. Indirect and intangible costs and benefits tend to be the most difficult to uncover in the analysis.


        The analysis does not factor in financial concerns like inflation, interest rate, varying cash flow and the present value of money. This makes it unsuitable for large projects that have a long-term time horizon. However, any type of model used in carrying out CBA can forecast future revenue or sales, alternative return rates and expected future cash flow. These forecasts are often factored into the models used in conducting CBA. A major limitation is that if one or two forecasts are incorrect, then the results of the CBA may be inaccurate.

        Following are the limitations:

        It’s difficult to predict all variables

        Using an analysis can make it difficult to predict all variables associated with the project regardless of whether the costs and benefits are identified. Factors such as a change in market demand, material costs, and the global business environment can all significantly impact the outcome of the project. Using the analysis for long-term evaluation without considering such factors can lead to an inaccurate conclusion.

        It’s only as good as the data used to complete it

        Data is at the center of this analysis. If incomplete and inaccurate data is used, then the results reflect it. Preparing a comprehensive analysis will ensure that accurate information is provided.

        It’s better to use it for short and mid-length projects

        Short and mid-length projects utilize the analysis more suitably. When used with long-term projects, the business faces difficulty making accurate predictions due to the extended project timeline. Long-term forecasts may also fail to consider emerging factors that may impact the analysis, such as inflation.

        It removes the human element

        The human element of the analysis is removed, which can prove to make it difficult for businesses to analyze the project or decision for non-monetary reasons. It does not consider the moral or human perspective but rather the technical aspects of the project.

        Key Takeaways

        Key takeaways of preparing the analysis include following:

        • It is conducted to measure and compare the benefits associated with taking a particular course of action against the cost of doing the same.
        • Measurable financial metrics like revenue earned or costs saved resulting from the pursuit of the project are involved in the analysis.
        • Intangible benefits and costs and the effects of a decision such as customer satisfaction or employee morale are all included in the template.
        • It can be written before a business embarks on executing a project or decision after the project is being implemented to help establish the impact of the action within the project or when a business is unsure as to whether it is in its best interest to continue with the course of action as planned.

        Frequently Asked Questions

        How do you weigh Costs vs. Benefits?

        First, the costs and benefits must be identified and quantified. Both, the total costs and benefits must then be compared. An observation should finally be made about whether the benefits outweigh the costs or whether they outnumber the benefits. Opportunity costs of other alternative projects should also be factored in to decide whether the project or decision is worth pursuing.

        What are some of the tools or methods used in CBA?

        The method or tool used depends on the specific project or investment. The standard methods used include net present value (NPV), which determines the cash flow value based on whether it is in the present or expected future or benefit-cost ratio (BCR), which can help sum up the overall relationship of the costs and benefits. Regression modeling, valuation, and forecasting techniques are other tools that businesses can utilize.

        What are the costs and benefits of doing the cost-benefit analysis? 

        The cost of conducting CBA is the time taken to evaluate the estimated potential cost and reward carefully. It may also include the money paid to an analyst or consultant to carry out the work on behalf of the business. Another cost may include the various estimates and forecasts required to create the analysis, which may be based on wrong or biased assumptions. A benefit is that when objectively and accurately done, the analysis aids good and well-informed decision making.

        Can small businesses benefit by doing a cost analysis?

        Yes, a cost analysis can be helpful for both large organizations and small businesses. It’s a tool designed to help you make better decisions for your company.

        Should I use an accountant when doing a Cost Analysis?

        This depends on how complex the categories and data being used are. For more complex figures, it is advisable to have an accountant go over costs with you.

        About This Article

        Julie Ross
        Authored by:
        Market Research, Business Planning, Financial Modeling, Project Management
        Julie Ross is a seasoned expert in market research, financial modeling, and business planning. With over two decades under her belt, she's honed her skills in Excel and Google Sheets, crafting in-depth models. She stands out with her adeptness in exhaustive market research, resulting in robust, visually compelling business plans with realistic financials. Beyond planning, Julie has managed multi-million dollar projects for Fortune 500 companies and startups, supported by an MBA and a Scrum Master certification. Her multifaceted expertise ensures holistic solutions for business challenges.

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