An approximate measure of the profitability of a potential
process or product that does take into account the size of the
project is venture profit. It is used often for preliminary
estimates when comparing alternative flowsheets during
the process synthesis stage of process design and/or the
concept stage of the Stage-GateTM Product-Development
Process (SGPDP). VP is the annual net earnings in excess
of a minimum acceptable return on investment,
Sometimes, for crude comparisons of flowsheets with different
arrangements of process units, the total capital investment
in Eq. (23.9) is estimated as the sum of the bare-module costs,
or even the sum of the purchase costs; and annual production
cost, C, includes only the cost of the raw materials, the
utilities, and the labor-related operations. The return on
investment, imin, is that desired by the company. Here, we
take imin ¼ 0:20ð20%Þ.