Here’s all that you need to make an informed choice on off the shelf vs custom software
Digital transformation has propelled businesses to adopt automation and scale up their processes to stay ahead of the competition. While doing so, they have two choices – to buy a ready-made off-the-shelf solution created for the mass market or get a custom software designed and developed to serve their specific needs and requirements.
The difference between off the shelf and custom written software
Several readymade solutions are available in the market that is incredibly easy to use. SAP, the enterprise resource planning (ERP) system, is a classic example of what you can achieve with off-the-shelf software powered by built-in intelligent technologies.
On the other hand, Airbnb has been using customized CRM (customer relationship management) software to create a tailored marketplace to elevate the customer experience.
Choosing one of these two options depends solely on the type of business, its specific requirements, the budget in hand, and a few other factors. In this blog, we intend to help you make an informed decision that serves the best for your business.
To build or to buy?
It can be overwhelming for organizations to choose between off-the-shelf software and custom software. It is essential to balance the long-term growth plans of the business with its short time needs while making a decision.
Before we dwell further, let’s take a look at the basics of off-the-shelf and custom software.
Off-the-shelf software is a pre-designed software developed to cater to the needs of a wide range of customers. It has the following benefits.
- Ready-to-use with few configuration steps
- Flexible commercials including annual licensing and pay-per-use
- Ready templates and workflows depending on Industry and Use Case
However, being a standard version designed for a wide range of customers, it may fail to meet some specific needs of a business. Some of the features may be irrelevant and new features would be difficult to add. Besides, an undifferentiated offering would also mean businesses would lack the distinction to stand out in the market.
On the other hand, custom software can be tailor-made to fulfill all the requirements of a business. Precisely why McDonald’s decided to cook up its own software to manage its supply chain decades ago. While its competitors used packaged point-of-sale software, McDonald’s created PC POS, a two-part system, that helped it reduce the cost of POS systems down to approximately $15,000 to $20,000 per restaurant.
A more recent example includes Uber API which utilizes custom software in transportation to make the driver experience more rewarding through its intelligent navigation and guidance systems. Amazon too uses customized enterprise software solutions to collect data and boost revenue, while Netflix is relying on custom software to offer personalized entertainment.
Those who critically evaluate their business requirements understand the potential customization holds in maximizing growth, decreasing costs, and increasing revenue.
Precisely why even popular off-the-shelf platforms like Shopify2 offer a high level of customization through its eCommerce solutions. Shopify allows businesses to build a visually appealing online store while providing security, reliability, speed, and a powerful suite of marketing tools. It empowers them to make it SEO-friendly and mobile responsive to ensure utmost shopping comfort.
Choosing custom software is easier when you know the feasibility, user experience and effort required to realize the desired solution.
Organizations are often tempted to start with an off-the-shelf solution, and they end up buying them too, only to realize their limitations in the long run. Unlike off-the-shelf solutions, custom software solutions are designed specifically for in-house use, helping organizations digitize processes to improve overall efficiency and performance.
The implementation difference
With a constantly evolving technology landscape, coding is no longer what it used to be. It’s fast, efficient, and relatively simple, as the proliferation of open source has made code snippets readily available for programmers. A smooth, drag-and-drop interface allows them to create highly advanced applications without writing a single line of code. As long as programmers have the essential knowledge about coding, they can develop custom software as required with the necessary features.
Of course, you will also need an in-house team to develop the software and address challenges pertaining to requirement gathering, app design, testing, support, feature enhancements, patches, and general maintenance that would require dedicated time and effort.
Off-the-shelf does not call for writing codes, but companies may often find themselves struggling to use agile methodologies to their full potential. Challenges usually arise due to a lack of skills required to use those platforms and insufficient customization.
Besides, successful implementation is not just about technology but also revolves around the people within the organization who may require training before they can adapt and accept accountability.
The decision to build or buy will require buy-in from key participants to ensure proper communication and collaboration among users, developers, customers, and business partners.
The cost factor
The initial cost of off-the-shelf software is usually low and affordable since it gets divided among multiple users who buy the same software license.
But is off-the-shelf ‘good enough’?
The initial cost has been a major draw for most opting for ‘off-the-shelf’ solutions. But it may often end up costing you more over time since you will have to spend on customization to align with your business requirements. For instance, if you need cloud-centric or mobile-specific features, those may not be inclusive of your standard package forcing you to pay a little extra to get these additional perks.
The cost of custom software, on the other hand, will have to include the assessment, designing, wireframing, and building costs.
The cost of custom software will depend on the time and resources required to complete the project and the user interface (UI) and user experience (UX) you intend to create. It will also depend on whether the software development is on-site or off-shore.
Off the shelf vs custom software : The 80/20 decision criteria
A readymade solution with a limited scope of functions and standard workflows is great for small businesses. The software can be launched quickly, and users dive into the new ways of working quickly without expert guidance or an extensive learning curve. But you should be aware of the perils of working with a one size fits all solution. Businesses need to measure their ROI based on the nature of their workflows, the tools and technologies they need, and the pain points they wish to address.
We recommend the 80/20 rule.
In other words, the off-the-shelf solution you choose should offer at least 80 percent of the features you are looking for and require only 20% of customization. But if you need further customization, you should evaluate the customization effort required versus having custom-built software. The key lies in mapping your long-term ROI so that your efforts and investments align perfectly with the organizational objectives, team goals, and nuanced workflows.
The custom application advantage
Custom software comes with a world of benefits and is hence preferred by many. Companies wanting to expand their footprints may choose to develop a custom platform aligned with their goals. Partnering with specialists can be an excellent option for those wanting the versatility of custom software but are not in a position to put together and manage a specialized team in-house.
Trigent recently helped a technology-driven fashion accessories retailer develop an easy-to-use mobile app. The application was designed by combining Augmented Reality, Artificial Intelligence, and Machine Learning to help digital shoppers determine the fit of their footwear from the comfort of their homes.
The custom application helped the retailer offer a differentiated experience for its millennial customers, maintain its leadership in the industry and increase its user base by 17%. The application also increased the usual sales three times and decreased product returns by 57%.
Want to know how? Read our case study
Build with Trigent
Our technology experts have been helping companies upgrade their technology stack, empowering them to reimagine their business and better engage with customers. Our suite of software solutions is just what you need to automate and revamp business processes. Our deep domain knowledge gives us an edge to design and build software for the specific needs of diverse industries.
References
