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Custom-Built Software: The True Cost

11/23/2021
|
10 mins read
written by
Dhoof Mohamed

Higher upfront cost investment:

Packaged software solutions are much cheaper than building a custom solution for your business. If your business uses a packaged solution, you can test it, share feedback with the provider and make changes rapidly; if you’re dissatisfied with it entirely, you can cancel your subscription and move on with no strings attached. In contrast, building a solution from scratch will give your business a smaller margin of error due to the higher cost. Your business will have to manage the IT team building the solution on top of paying the price of the solution. Depending on the complexity of the solution your business is trying to build, your IT team is required to know exactly what they are building and if it fails the total cost will affect your business.

This looming upfront cost prevents your business from being nimble and making the daily adjustments needed to stay competitive. For most businesses, trying a packaged solution before trying to build a custom solution is the best option because it allows your business to test out products or services and if it fails you can still build the custom solution later.

Time cost:

The opportunity cost of custom software can be extremely expensive, especially in regards to time. Whether your business is a startup or an established business, momentum is everything. Having a packaged software solution allows you to hit the ground running instantly instead of waiting weeks to months to develop software. The first time cost resulting from using custom built solutions is during a product or service launch. Launching your business or a new product in your business quickly allows you to test the market and test your preconceived assumptions. A packaged solutions allows you to reiterate multiple times allowing your business to have faster feedback cycles to improve your product or service. In contrast, a custom-built solution requires a heavy cost investment upfront and will require additional costs anytime it’s reiterated or updated.

Additionally, if your business faces IT downtime, a packaged solution is much less likely to have an extended period of time where your business is affected. If you’ve built a custom-built solution, your business downtime is directly proportional to how quick your IT team can solve the pending issue. If you face an extended downtime, your brand, business and reputation can take a significant hit.

Cost of updating:

Monitoring and maintaining custom-built software can be the most expensive aspect of choosing custom-built software over packaged software. In today’s competitive business arena, software updates at breakneck speed which forces companies to either adapt or suffer. After your custom-built software is built, your business has total responsibility for updating it, fixing bugs and any other technical difficulties. This not only requires an IT team, but it requires periods of downtime that is required to fix any bugs; this will multiply your cost because of the additional payroll and sales during downtime.

Updating custom-built software is also costly because your business will face the consequences of any bugs in real-time. This is less cost-effective than packaged software because there are many businesses who have utilized the software prior to your business so any damage from bugs has already been dealt with. Also, the customer support for packaged solutions is usually 24/7; this will help solve any problems much quicker than waiting for an IT team to show up the next business day. If you’d like to learn about the solutions at Skyriver IT, click here for a free assessment!