“Custom Software vs SaaS: Choosing the Right Fit”

Nowadays, it’s impossible to run a small or medium business or a large organization without effective software solutions. 

Whether it’s custom software for keeping financial records or a SaaS solution to operate daily tasks like documentation, communication, and coordination, digitalization of operations is no longer a luxury, but a necessity. 

The digitalization of businesses is on the rise: 89% of all companies have already gone digital or plan to do so. Innovative digital solutions for businesses are vital for growth and optimal functioning. 

When it comes to choosing a software solution, many have a dilemma, i.e., to go with a custom software solution that will be exclusive to their business or buy a SaaS solution instead. 

Which is the right fit for your business’s needs and budget?-Let’s find out!

SaaS vs. Custom Software Solution

SaaS is a fast-growing market with a CAGR of 17.6% annually.

It’s short for Software as a Service. It’s a cloud-based software solution and a business model that’s accessed via the Internet. This software is hosted on a cloud and usually operated via a browser. A business usually needs to pay a certain monthly or yearly fee to access it.

The sellers of the software are in charge of the development, maintenance, and upgrades. It’s convenient, inexpensive, and easy to use. A great example of how a SaaS solution can improve businesses’ practices is Green-Go’s turfgrass management software. 

The platform designed by ArtHaus experts allows clients to manage weather stations and care for the turf by providing visual and precise data and enabling care automation, reduction of pest outbreaks, and problem prevention.

Unlike SaaS, custom software is built from scratch to advance the processes, needs, and requirements of a single company. 

This option is targeted and takes time to be developed, may be more expensive, and may require continuous maintenance and support. Still, the need for such solutions is evident: the global market size will increase at a CAGR of 22.4% in the period from 2023 to 2030.

Companies benefit from tailored software if they have processes that require a unique approach. ArtHaus partnered with TDC Manufacturing, the largest kitchen and vanity manufacturer in New Zealand, to redesign its in-house software solution for online ordering. 

Thanks to the improved custom CRM system, manufacturers and end users can place orders seamlessly and accurately. 

What Are the Pros & Cons of SaaS?

A SaaS solution comes with pros and cons. Let’s learn why it could be a good choice for a business:

  • Lower costs 

Since there’s only a certain fee paid upfront or on a schedule, you needn’t spend a small fortune. 

Many SaaS options offer different pricing models and payment options to meet various company budgets.

  • Easy maintenance 

With many SaaS solutions, businesses get access to automated updates and maintenance services that are the seller’s responsibility. 

Employees will have updated tools and the steady maintenance will prevent spending more on a new solution. 

  • Flexibility 

With the expansion of remote working, flexibility is everything. Many SaaS solutions can be accessed from anywhere via the internet. 

SaaS may not be the best solution for a business due to the following reasons:

  • Concerns about security and privacy

With most SaaS solutions, you’re entrusting data to a third party. This may not be suitable in terms of security, particularly if there is sensitive information.

  • Limited offline access

SaaS solutions work over the internet so there’s a need for a steady connection all the time. If not, there’s a risk of productivity disruption and inability to access important software. 

  • Customization limits

Since they’re designed to serve different customers, SaaS solutions may have limited options for customization, making it harder for businesses to meet specific requirements and processes, further reducing efficiency. 

  • Long-term costs 

SaaS may be less expensive upfront, but the ongoing subscription fees can add up as time goes by. There are situations when the price of owning a SaaS exceeds the cost of buying and maintaining a custom software solution.

What Are the Pros & Cons of a Custom Software Solution? 

A custom solution may be worth it because of the following benefits:

  • Custom-made 

Targeted software solutions meet the most specific needs, requirements, and processes of a business and are aligned with the company’s vision. 

  • Highly customizable 

Adaptability and customization are the key features of a custom solution. Each aspect is tailored to meet a business’s goals and needs. It can also be customized when needed as the business grows and changes.

  • Cost efficiency

Though a company may need to invest more to get a tailored solution, this option often proves to be more cost-effective long term due to the absence of fee-associated costs.

  • Full ownership & control

When you invest in custom software, you get full ownership and you can modify, update, and distribute the software as you need/want. 

A custom software may not be a suitable option due to these reasons:

  • Time-consuming

Creating software from scratch takes time (weeks, months, or longer). If a company doesn’t have the time necessary for the development process, such a solution may not be adequate.

  • Expensive 

Regardless of the industry, a tailored software solution will require higher upfront investments, although it may save you additional funds that you would spend on security, licenses, and customization expenses associated with SaaS.

  • Maintenance costs 

The rewards with custom software solutions are many, but the costs are also higher. A large part of the budget may need to be allocated to maintenance like optimization, updates, backup, testing, etc. 

  • Involvement 

A custom solution takes time and requires additional involvement from the management. As it’s catered to suit various aspects of the working processes, teams may need to come together to propose solutions, needs, and requirements to ensure optimal efficiency. 

Final Thoughts

Choosing the right software solution for the needs of your company depends on numerous factors like budget, goals, time, etc. SaaS may be a better fit if your company is limited in terms of budget and if the needs and requirements are met by a product that’s already available. 

A custom solution is a great investment for companies with enough budget and unique workflow that wouldn’t be efficient enough without such a solution. 

If you’re unsure what option to choose, consulting our experts at ArtHaus is highly recommendable. We have been delivering effective software solutions to businesses globally, within budget. 

Don’t hesitate to contact us today to learn more!