Ready-made or custom-made?
This debate has been around in fashion for years and is now in the IT industry.
When you’re thinking about getting new business software, you’ll have to decide whether to build it from scratch or buy something off the shelf. This decision is one that can have long-lasting consequences that will be felt years down the road.
Choosing commercial software is like buying from a restaurant menu. It’s fast, simple, and effortless. You just select a meal that meets all your criteria, make the payment, and within minutes, it’s ready to eat. All the laborious tasks of prepping, cooking, and putting it together have already been done.
But going for custom software is like hiring an expert chef to cook personalized meals with your favorite ingredients right in front of you.
Deloitte says today’s leaders need to invest in tech that generates clear business value through fostering growth and innovation – not just grab quick fixes with new software for short-term problems.
Forward-thinking leaders are thinking about how technology in its entirety influences their future strategic objectives and innovative developments.
A lot of our clients say that they’ve been able to boost productivity and gain a competitive edge. They no longer need to hire costly dev teams to manage apps and can easily accommodate new changes or processes. Plus, custom development has slashed their integration costs and saved their budgets.
But if you’re wondering why building your own software is the right choice for your business, we’ve compiled these helpful reasons why custom software development is important.
Build vs. Buy vs. Hybrid vs. OSS
Before we jump into the advantages of custom software and how it excels over commercial software, let’s explore the 4 approaches to rolling out a digital solution:
- Building custom software
- Purchasing off-the-shelf software (COTS / pre-packaged / SaaS)
- Purchasing off-the-shelf software and customizing it (hybrid)
- Using open-source software (OSS)
Custom Software
Custom software is software that’s specifically built by an in-house software development team or a custom software development company to address unique business needs, requirements, or challenges.
One of the best things about custom software is that it fits the exact processes and workflows of the organization, providing specific features and functionalities that aren’t available in other solutions.
Its built-from-scratch nature ensures that you get tailored capabilities that are designed from the ground up to improve your business.
That’s what we did with SprocKids, a non-profit organization that wanted to optimize its operations. To see how we fixed that client’s SaaS headaches with our custom software, check out our article on membership management customization and integration.
Developing a custom piece of software can initially involve higher costs compared to purchasing off-the-shelf software. However, it can offer long-term cost savings by reducing the need for multiple software licenses.
It might feel like a big expense upfront, but once you’re done, the software is yours to use or sell. It’s owned by your organization outright unlike off-the-shelf software where you merely pay for the right to use. Fortunately, at Bitcot, 85% of our clients make back their investment within 12 to 20 months.
Well, great things also take time. A project requires:
- careful planning;
- prototyping and design;
- and a witty dev team to make that happen.
The process involves planning, designing, developing, testing, and deploying software from scratch. This approach allows for maximum customization, control, and ownership over various aspects of the software’s lifecycle.
Moreover, with low-code development services in the picture, creating custom solutions is becoming faster and more cost-effective, enabling businesses to get the best of both worlds: tailored functionality without the traditional time and expense.
Once launched, the software often requires minimal tweaking. That’s no surprise, after all, it was built with your company in mind.
Off-the-Shelf Software
Do you need a software solution right away? The good news is that pre-packaged software is fairly “plug and play” ready, offering rapid deployment and usability.
They are pre-built, standardized applications that are readily available to be purchased, licensed, or downloaded. In most scenarios, you buy the software, gain access to it, and then make the needed tweaks.
Off-the-shelf software is available in two types – traditional applications that you install on your computer and software-as-a-service (SaaS) platforms that run on the cloud.
Examples of off-the-shelf software include Zoho CRM, QuickBooks, Oracle ERP Cloud, Shopify, Zendesk, Workday, and Salesforce. There are all sorts of pre-packaged software across various domains – there’s an off-the-shelf solution for just about every business process you can think of.
These products are developed by software vendors to address common needs or functions across various industries or purposes. They are typically mass-produced and sold to a wide range of customers, and come with a bundle of generic features and functionalities that are already there.
Since they are already developed and tested, they can be deployed quickly. Several 3rd party products feature quick automated installation or easy-to-use constructors with intuitive building blocks. This allows for faster time-to-market and MVP launch, incorporating the functionalities you want almost straight away.
They are also typically more affordable because development costs are spread across many customers.
All the upgrades, tweaks, new feature releases, and maintenance are the provider’s area of liability. You don’t have to regularly think about how to make the ready-made software better, safer, or more convenient. This is included in the package.
However, ready-made software products are inherently inflexible. They can’t be tailored for specific business use cases, may require compromises in functionality, may not be compatible with your existing systems, and can lead to vendor lock-in if migration or customization options are limited. Any of these will cancel out the speed benefit.
Customized Off-the-Shelf Software
When you purchase off-the-shelf software and customize it, you’re taking a hybrid approach that combines the benefits of pre-built solutions with the flexibility of better aligning them to your specific needs.
This can include:
- Configuration: Adjusting settings and options within the software to reflect specific business rules, data formats, or operational preferences.
- Integration: Connecting the software with other systems or databases used within the organization to ensure seamless data flow and interoperability.
- Functional Extensions: Developing or integrating additional features or modules that aren’t included in the standard version of the software.
- UI Adjustments: Modifying the software’s interface to improve usability or align with branding guidelines.
Customizing off-the-shelf software is more cost-effective than developing custom software from scratch because you start with a base product that already has many features. Customization allows you to tailor the software to address these specific requirements that might not be fully met by generic solutions.
You will still require skilled developers for this task, and while you won’t enjoy ownership benefits, you will obtain a customized tool with considerably less effort.
The major risk in going for a customized off-the-shelf solution is that sometimes you can’t implement certain customizations effectively or at all.
Off-the-shelf software may have inherent technical limitations that prevent certain types of customizations. For example, the architecture of the software may not support extensive modifications to core functionalities or data structures.
Also, extensive customization can potentially lead to compatibility issues with future software updates or upgrades provided by the vendor. This can result in additional costs and efforts to ensure that customizations remain functional and compatible.
Open-Source Software
Open-source software is software that’s released with a license that allows anyone to view, use, modify, and distribute the source code. It’s available for free or at a lower cost than proprietary software. Businesses can modify it to fit their specific needs, allowing for greater customization and adaptability.
Examples of open-source software include WordPress, Magento, OpenProject, SuiteCRM, Mattermost, etc.
Obviously, there’s a lot to love about open-source software, but it isn’t for everyone. The two big letdowns are the complexity and limited support.
Open-source solutions only provide a starting point. They can kickstart your development process but your project will still necessitate meticulous planning, custom coding, rigorous QA testing, and ongoing development efforts to reach a finalized solution. All these tasks fall under your responsibility.
While community support is often available, it’s not as reliable or timely as commercial support services. For many organizations, the lack of tailored support alone makes a custom solution a more desirable option.
| Aspect | Custom Software | Off-the-Shelf Software | Hybrid | Open-Source Software |
| Ownership | Full control and ownership | Licensed Use (vendor ownership) | Split ownership | Community-owned |
| Development Time | Long (from scratch) | Short (implementation) | Medium to Long | Short to Medium |
| Cost | High (extensive time and resources) | Low to Medium (includes hidden costs) | Medium to High | Low (if no customization) |
| Pricing Model | Project-based Pricing | License-based / Subscription-based Pricing | Combination of Both | Free (but may incur support costs) |
| Customization | High | Low | Medium to High | High |
| Maintenance | Fully Supported (internal/external) | Based on the Vendor’s T&C (unplanned downtimes) | Medium (shared) | High (internal/community) |
| Scalability | High | Medium (costly) | Medium to High | Medium to High |
| Integration | High | Medium | High | High |
| Control | Full control | Limited control | Moderate control | Full control |
| Compliance | Fully customizable | Vendor-provided compliance | Customizable | Varies |
| Support | Developer-provided | Vendor-provided | Vendor and internal | Community and internal |
Industries See Greater Benefits in Custom Software
At Bitcot, we obviously lean toward custom software, but we are making the same “build or buy software” choice that most of our clients are making.
Custom software solutions are specifically designed for your unique circumstances and, when executed right, offer an almost perfect solution to your pain point.
It’s not as easy as loading a program and getting an instant benefit but it can be made to meet every requirement you wanted during the evaluation stage. Instead of settling for something that’s just “good to have”, you can get exactly what you need.
When deciding whether to build vs. buy software, businesses have usually chosen to buy off-the-shelf options for more than two decades.
It does make sense. Commercial solutions provide greater initial value, being easily accessible and requiring minimal setup.
But even the finest solutions have their weak points.
The greatest strength of an off-the-shelf solution is also its biggest weakness: it’s made for the masses. While this software might look good now, will it still cut it for you in two years? There’s a high chance you’ll outgrow it sooner than you expected. As your business grows, that off-the-shelf solution might not keep up with what you need.
Here’s a scenario: say they unexpectedly change a functionality that your organization relies on. You’re left with no choice but to adjust your workflow to accommodate the update, which is not only inconvenient but also risky.
What do you do when you want to customize the off-the-shelf software? Say, you’d like to enhance its reporting capabilities by integrating a custom data analytics module tailored to your business’s specific metrics and insights needs.
Your best bet is to reach out to the vendor and see if it’s doable. Sometimes it might be, but pre-packaged software customization:
- can be trickier than it seems (if possible at all);
- involves extensive code review;
- often comes with a cost.
Simply put, the flexibility provided by commercial software is limited, it wasn’t even intended. Their design and functionality aren’t meant to be flexible or customizable. Therefore, any attempts to significantly alter or extend the software’s capabilities may encounter challenges. Besides, you still need people to tweak the ready-made software.
What it boils down to is this: your canned solution can’t stand a chance of beating your competitors if they are using their own software.
Though there are tons of excellent off-the-shelf options out there, you might be surprised how many great reasons there are to go custom.
Impactful Features
Custom software development allows businesses to build solutions designed to address specific pain points. Unlike off-the-shelf software which often comes with a plethora of features, much of which may be irrelevant, custom software focuses resources on developing essential functionalities that add direct value.
“We now know that something between 85-90% of most software product features are unwanted by customers. That is an enormous amount of waste of time and money that ends up on the floor.”
– Steve Blank
Excess functionalities you don’t use can become a huge problem. Think of it like this: what makes off-the-shelf solutions appealing? Their versatility. They are designed to cover a lot of bases by packing in features that most businesses need.
Seems great, huh? But here’s the hitch—sometimes all those fancy extras can weigh down the software and slow things down with heavy code.
Take, for example, you’re setting up a mobile app for a ride-sharing service and integrating a 3rd party mapping software like Google Maps. This readymade solution comes with a bunch of features, some of which you might not even need.
Let’s say there are 10 core features like real-time traffic updates, detailed route planning, public transportation options, and nearby points of interest, out of which 3 are mandatory to display on the front end.
This means users will always see public transportation options and nearby points of interest, which are unnecessary for your app. These extra features consume additional bandwidth and processing power, making the app slower and less responsive. This will annoy your users, potentially driving them to a competing service.
Can anything be done? Sadly, there’s not much you can do about it, as your development team likely can’t modify the core aspects of the code. Most times, you just can’t simply ditch a part of the software due to shared infrastructure, compatibility issues, and contractual agreements.
Therefore, without a custom solution, you find yourself in a situation where the unused features are negatively impacting your app’s performance, and there’s little you can do to optimize it without having full control over the underlying code.
Pricing
Surprisingly, a custom solution costing five thousand dollars is more cost-effective than a commercial solution that only costs a couple hundred.
While off-the-shelf software solutions are generally cheaper, sometimes custom solutions can actually end up costing less as they incur a one-time development cost with lower ongoing maintenance expenses.
For example, take a look at Salesforce’s pricing scheme for SMBs. (Image Source: salesforce.com)
- You might end up purchasing a higher plan to access a specific feature, leading to unnecessary expenditure. But with a custom solution, you pay only for what you need.
- If a business grows and requires advanced features that are not included in the lower plans, they would have to opt for the expensive plans which range from $165 to $500 a month. A custom solution could provide all the advanced features at a lower total cost and with more flexibility, avoiding incremental pricing.
- Several important features are only available for purchase separately. A custom solution could bundle these features directly, avoiding additional purchase costs.
- If your SMB has very specific needs such as specialized sales engagement or unique data management requirements, creating a custom solution could be more cost-effective. Customizing Salesforce beyond its built-in features can become expensive and time-consuming, exceeding the cost of a custom solution.
Design
Organizations have the ability to dictate the design of the software according to their specific needs and workflows. They can collaborate closely with the design team to ensure that the UI and UX meet their exact requirements. This includes customizing the look and feel of the software to align with corporate branding.
Having software made specifically for your company lets you blend your brand into the interface. Custom software is close to 100% effective in incorporating specific design elements, layouts, and interactions that align with corporate branding guidelines and user preferences.
Most off-the-shelf products don’t let you customize colors and icons, so essentially all companies using the software end up with the same look.
If your brand matters (and it really does), building your own software gives you the freedom to infuse every bit of your brand into it. This becomes even more critical if your software faces customers.
Integration
Another big benefit is custom software can be seamlessly integrated with existing systems and apps used within the organization. This means you can streamline workflows and data management across different departments or functions.
This offers many possibilities. For one, it’s easy for you to enhance collaboration between teams and ensure data consistency across the board. Plus, you can adapt and scale your software as your business grows, without being tied down by the limitations of commercial solutions.
You’ll also be surprised to know that custom software integration could actually result in cost savings over time. This is because, by reducing manual processes, minimizing errors through automation, and improving overall efficiency, you gain significant savings in operational costs.
Free integrations offered by off-the-shelf solutions often provide basic functionality and might only sync a limited set of data points. For more comprehensive integration, which involves deeper data synchronization and more customized workflows, businesses often need to consider third-party vendors.
Take SalesForce, for instance – it offers robust integration options but comes with technical limitations. For example, it can’t generate SharePoint files directly within the platform. For high-performing companies, seamless integration is simply not negotiable.
See, organizations hardly ever stick to just one software solution. Productiv’s data reveals that the typical company employs a staggering 254 SaaS-based applications. This might be stating the obvious, however, sometimes the obvious must be stated – managing integration between a large number of apps is hard.
Sadly, shifting between them eats up time and focus, hurting staff productivity. This also makes transferring data between different apps tend to be error-prone.
Imagine you’re running an e-commerce store. Without integration, you have to manually send orders from your website to warehouse and fulfillment departments, and errors at this point can cause transaction delays. To prevent this, you’ll need a customized order management system that connects these functions seamlessly.
If you know you want to connect with systems A and B, you can design your custom solution to handle that from the start. This means you’re planning ahead for how data should be structured and stored for sharing with these other systems.
Security Standards
If you go custom, you avoid situations where you might need to wait for the provider to release a security patch or experience downtime caused by issues on their end.
Custom software allows you to implement and enforce your own security standards and protocols. This is crucial for industries that handle sensitive data or must comply with regulatory requirements.
Organizations can incorporate specific security features such as encryption, access controls, audit trails, and vulnerability assessments tailored to their security needs. This level of control helps mitigate risks associated with data breaches or unauthorized access.
For organizations with high-security risks, developing software internally provides essential control over critical aspects like access management. For government entities, NGOs, or niches highly targeted by hackers, using commercial software isn’t recommended.
This is especially true for web applications that store data on the developer’s servers. Commercial software can make organizations vulnerable since malicious actors often target widely used platforms to exploit known vulnerabilities.
Maintenance
Organizations can prioritize updates and bug fixes based on their own timelines and operational needs. You won’t experience mandatory updates or downtime as long as the software meets your satisfaction. Maintenance tasks can include fixing issues, optimizing performance, and ensuring compatibility with new hardware or software environments.
Compliance and Governance
Industries like healthcare and finance often require the tailored functionality of custom software vs. off-the-shelf solutions that may not meet their stringent regulatory and operational needs.
Custom software development enables organizations to build solutions that comply with industry-specific regulations and internal governance policies. By adhering to these standards from the outset, organizations can avoid potential legal or operational pitfalls that may arise from using generic software that does not meet regulatory requirements.
Scalability and Flexibility
Since custom software is developed with the organization’s current and future needs in mind, it won’t limit your growth. It can easily accommodate changes in business processes or growth in the organization without requiring major adjustments or compromises.
On the other hand, off-the-shelf solutions may not be able to handle the increasing demands of a growing business. They might have limitations in terms of the number of users, volume of transactions, or complexity of operations.
So, unless you’re prepared to risk significant constraints on your scalability, custom software becomes almost essential beyond a certain threshold.
Custom software can help you break free from these constraints by addressing the 3 main hurdles that hold back your business from growing.
- Your internal systems aren’t built for expansion.
- Your operating costs increase as your sales grow.
- You’re still doing everything yourself.
Custom software, tailored to your scalability requirements, can address these challenges by providing a cost-effective solution that supports efficient business growth.
Final Thoughts
Custom software is created:
- for a set purpose;
- on a preferred technology stack;
- to fit well within the current environment.
Businesses building custom software have effectively fulfilled specific needs cost-effectively, modernized backend and legacy systems, and enhanced digital experiences. They have the capability to customize almost every aspect of the software.
The ownership and control that organizations have over custom software extend beyond initial deployment. They encompass the ability to shape the software’s design, functionality, security, and ongoing maintenance according to their specific operational needs, strategic goals, and regulatory obligations.
This level of endless customization and control that’s possible with a customized solution does come at a bigger upfront investment. But in the long run, this pays off with efficiencies that streamline processes and boost overall organizational agility.
While commercial software often involves monthly subscriptions to manage costs, this might end up costing a lot more than what you’d spend on custom software. And if you don’t pay for the software on time, you lose access.
Cost efficiency here is not simply achieved because multiple users “chip in” to support the solution. Rather, it’s made possible because custom software eliminates unnecessary features, gives scalability control, and avoids extensive integration efforts, blanket upgrades, or patches.
“We’re glad we decided to build our own software. If we ended up buying software instead, then we’d most likely still have angry clients suffering from fraud.”
– Founder & CEO, Lunio
By outsourcing your bespoke software development project to an external partner, you will not only save costs but also gain access to specialized skills and expertise that may not be available in-house.
Bitcot has got you covered with end-to-end custom software development that’s all about meeting your business needs, tackling challenges, and hitting your goals. We turn your ideas into real, practical solutions that get the job done at an affordable cost.
Whether it’s web and mobile apps, enterprise software, AI and automation, SaaS development, cloud migration, or legacy modernization, we’ve got the skills to build innovative solutions. Your customers will love it, your team will find it easier to work, and your business will grow smoothly.
Get in touch with us to learn how we can help you soar to the very top, hard and fast.
