Whenever an organization turns to technology to solve a business problem or seize a new opportunity, the question arises: should you develop custom software or use an out-of-the-box solution?
Companies looking to gain a competitive advantage are increasingly turning to custom software to meet specific business needs and maintain greater control over their technology. The custom software development market reached $28.2 billion in 2022 with an estimated CAGR of 21.5% between 2023 and 2032. This growth highlights the increasing importance of tailored solutions.
However, custom software development isn’t ideal for every situation. Read on to learn the differences between custom software and off-the-shelf solutions and to decide which is right for your development project.
Custom software development entails the conceptualization, creation, and ongoing maintenance of a unique software product tailored to fulfill the specific requirements of a company or project. While off-the-shelf or out-of-the-box software provides a one-size-fits-all solution, custom software development can be tailored to meet a specific business need and work with the company’s existing software and processes.
This approach is often used when off-the-shelf solutions aren’t able to fulfill the desired use case or when there are challenges with integration and compatibility with existing systems. Using a custom software development company often creates a key competitive advantage in the marketplace as the product or solution isn’t as easily copied by competitors.
When evaluating a new business case, should your organization use an out-of-the-box solution or develop custom software? There are pros and cons of custom software services and out-of-the-box software that your business needs to consider before implementing a new solution.
Custom software usually has a higher upfront cost compared to a SaaS tool. If another software is truly ready to be implemented out-of-the-box it is the cheaper upfront option. However, if further customization is needed to integrate the solution, the off-the-shelf software may come with unexpected implementation costs.
In the long term, a SaaS solution will most likely be more expensive due to subscription fees. It depends on the planned lifecycle of the solution whether the upfront costs of custom software development will end up less expensive than ongoing subscription costs.
Out-of-the-box solutions can usually be implemented quickly. Custom software solutions take time to design, develop, and deploy. Compare the proposed software development timeline with your desired time-to-market to determine if you’re able to invest the extra time in custom development.
Custom software is much easier to adapt and update as the business needs evolve. This ensures longevity and increases the value of your upfront investment. By comparison, off-the-shelf software offers less flexibility in the short and long term. If a SaaS vendor removes critical features or discontinues support, it could have a major impact on your business.
With a custom solution, the business retains full ownership of the software and source code. The third-party vendor retains full ownership and control of off-the-shelf software. This lack of control makes it difficult for enterprises to fully rely on a third-party solution for critical business functions. It also removes any potential competitive advantage gained from the solution as the vendor is free to sell their tool to competitors using your use case as a proof of concept.
There are many advantages to custom software development that businesses can see if they have the time, resources, and upfront capital necessary. Here are some of the main benefits your organization can see:
While the benefits of custom software development are clear, it isn’t right for every project. If you need a quick, generic solution to a non-critical business function, you may be better off with a simpler, out-of-the-box implementation.
Determine if custom software development is right for you by letting Gigster create a low-cost MVP. This provides a clearer path forward to make the project happen. Share your idea with us today to get started.
