How to Calculate Cobot ROI: A Worked Example

Every automation project eventually lands on the same question: when does this thing pay for itself? A cobot ROI calculation is the tool that answers it, and the good news is that it is far simpler than most people expect. You do not need a finance degree or a twenty-tab spreadsheet. You need an honest list of what the cell will cost, an honest list of what it will save, and the discipline to include the items that everyone forgets. This guide walks through both sides of the equation, then runs a full worked example for a two-shift machine tending cell so you can see the numbers move.

What goes into a cobot ROI calculation

Return on investment compares what you put in against what you get back. For a cobot cell that means one column of one-off costs and one column of recurring annual savings. Keep them strictly separate, because mixing them is the fastest way to end up with a number nobody trusts.

The investment side: what you actually pay

• The robot and controller. The headline item, and usually smaller than people assume. Fairino cobots sit at the affordable end of the market, and the price includes the controller and the programming software with no annual licence fees.
• End of arm tooling. Grippers, vacuum units, a tool changer or a force sensor. Budget realistically here, because tooling is often the difference between a cell that works on day one and one that fights you for months.
• Integration and fixturing. Pedestal or frame, part presentation trays, guarding if the risk assessment calls for it, machine interface wiring, pneumatics and electrical work.
• Engineering and programming. Either your own hours or an integrator day rate.
• Training. A day or two so your own people can change programs, recover from stops and adjust positions without calling anyone.
• Installation downtime. The production you lose while the cell is being built and commissioned.

The return side: what you get back every year

• Redeployed labour hours. Not necessarily a headcount reduction. In most European workshops it is an operator moved off a dull loading task and onto work that actually needs a person.
• Extra output. A cobot that keeps a machine fed through breaks, or runs a lights out hour after the shift ends, turns idle spindle time into billable parts.
• Scrap and rework reduction. Consistent placement and consistent torque mean fewer rejects.
• Fewer overtime and temp hours when demand spikes.
• Lower absence and injury cost on repetitive or heavy tasks.

The payback formula

Once both columns are filled in, the core of any cobot ROI calculation fits on one line:

Payback period (years) = total investment / annual net savings

And for a percentage figure over a chosen horizon, usually five years:

ROI (%) = ((annual net savings x years) - total investment) / total investment x 100

Annual net savings means gross savings minus the recurring costs the cell brings with it, such as maintenance, energy, consumables and spare grippers. Those are small for a cobot, but leaving them out makes your case look better than it is, and finance directors notice.

A worked example: two-shift CNC machine tending

Take a subcontract machine shop running a CNC lathe across two shifts. An operator loads and unloads parts, and spends roughly four hours per shift standing at the machine door doing nothing else. The cycle is long enough that the person is waiting more than working. This is the classic first cobot application, and the one we see most often at TMC Robotics.

Step 1: the investment

• Cobot and controller, 5 kg class: €4,900. That is the list price of a Fairino FR5, controller and programming software included, no licence fees.
• Gripper, tool changer and part trays: €6,000
• Pedestal, guarding and machine interface: €5,000
• Integration, programming and commissioning: €8,000
• Training and lost production during install: €3,000

Total investment: €26,900. Notice how small a share the robot is: the arm is under a fifth of the project. These are illustrative figures for a complete cell rather than a quote. Your own numbers will shift depending on the tooling and the machine interface, which is exactly why you should build the table with real prices before you decide.

Step 2: the annual savings

The cobot takes over eight hours of loading per day across the two shifts. At a fully loaded labour cost of €38 per hour, including employer charges, and 230 working days per year:

• 8 hours x €38 x 230 days = €69,920 of labour time released

Be careful here. That figure is only a cash saving if you genuinely remove the cost, for example by not replacing a leaver or by cutting temp hours. If instead you redeploy the operator to deburring and quality checks, count the value of the work they now do, which is usually lower than the raw hourly cost. To stay conservative, this example counts 60 percent of the released time as real value: €41,950.

Then add the second lever, which is often the bigger one:

• Extra machine hours. The cobot keeps the lathe fed through breaks and shift changeovers, adding about 45 minutes of spindle time per day. At a contribution margin of €45 per machine hour, that is roughly €7,800 per year.
• Scrap reduction. Consistent loading removes a handful of crash and misload incidents per year, worth about €2,500.

Gross annual savings: €52,250.

Step 3: subtract the running costs

• Electricity for the cobot: around €250 per year
• Maintenance, spare gripper jaws and consumables: €1,200
• Internal programming time for new part families: €2,000

Annual net savings: €48,800.

Step 4: run the numbers

• Payback period: €26,900 / €48,800 = 0.55 years, roughly seven months.
• Five year ROI: ((€48,800 x 5) - €26,900) / €26,900 x 100 = 807 percent.

A five year return of 800 percent looks too good, so be clear about where it comes from. Almost the whole return is labour time, and the arm itself is the cheapest line in the budget. Challenge the labour number first, not the robot price.

So run the pessimistic version. Halve the labour value, count the extra machine hours as zero and add a third to the investment, and you land at about €20,000 net savings against €35,800 invested, so payback in a bit under two years. That is the number worth taking to your finance director. A good cobot business case survives its own worst case.

Hidden costs people forget

• Part presentation. Raw parts arriving in a mixed crate need a tray, a conveyor or a vision system before a robot can find them. This is the most commonly underestimated line in the whole budget.
• Risk assessment and CE marking of the cell. A collaborative robot does not make a cell automatically safe, and the assessment is a real deliverable with real hours behind it. If speed and separation monitoring is needed, a safety laser scanner belongs in the budget too. Our guide on cobots and safety fences explains when you need one.
• The learning curve. The first application always takes longer than the second. Build a few extra engineering days into project one.
• Changeover time. If you run high mix work, the minutes spent switching the cobot between products belong in the calculation.

Savings people forget to count

• Recruitment and onboarding avoided. Filling a repetitive production role in the current market costs real money and often takes months.
• Quality consistency, which shows up as fewer customer complaints and fewer credit notes rather than as an obvious line in the ledger.
• Capacity you can quote on. Extra machine hours let you accept work you would otherwise turn away.
• Redeployment to a second task. A cobot on a quick change pedestal can serve two machines or two shifts of different work, which effectively halves the cost per application.
• No software licence fees. Some platforms charge annually for programming environments or add on packages. Over five years that difference alone can be worth thousands, so compare the full package and not just the sticker price.

How to improve your cobot ROI

• Pick the right first application. High volume, stable parts, a long machine cycle and a task nobody enjoys. That combination almost always pays back fastest.
• Size the robot properly. Overspending on reach and payload you never use inflates the investment column for nothing. For most machine tending cells a 5 kg class arm such as the FR5 is enough, and you only step up to the FR10 when the tool stack and the part genuinely demand it.
• Keep tooling simple. A standard gripper on standard trays beats a clever custom mechanism that takes three months to debug.
• Train your own team. In house programming turns every future change from an integrator invoice into an afternoon of work.
• Plan the second application before the first is finished. The second deployment carries almost none of the learning cost, so it improves the average return across the whole programme.

Domande frequenti

What is a good payback period for a cobot?
Most manufacturers aim for under two years, and well chosen first applications frequently land between six and eighteen months. Anything beyond three years is worth re-examining, usually because the application is low volume or the tooling is too complex.

Should I count the operator's full hourly cost as a saving?
Only if the cost genuinely disappears from the books. If the person is redeployed rather than removed, count the value of the work they move to instead. Being conservative here makes your business case much harder to argue with.

Do cobots have ongoing software or licence costs?
Fairino cobots ship with their programming software included and no annual licence fee, so the recurring costs in your calculation are limited to maintenance, energy and consumables. Not every brand works this way, so check before you compare quotes.

What if my production volume changes?
That is the main advantage of a cobot over fixed automation. Reprogramming for a new part takes hours rather than weeks, and the robot can be moved to another machine or another task, which protects the investment if a product line ends.

Want the same table filled in with your own figures? Send us your part weight, cycle time, shift pattern and current labour cost through our quote form or the contact form, and we will build the cobot ROI calculation with you, including a realistic tooling budget. You can also browse the full Fairino range or see what other companies achieved on our cases page. All prices here are B2B, excluding VAT.