Build Vs. Buy – The Definitive Guide

So, it’s time for your business to invest in a shiny new piece of software. One of the first decisions you will need to make is whether you are going to build a custom piece of software or buy a prebuilt solution. Building software can be expensive. Buying software can leave you stuck with a solution that you may outgrow in a short amount of time. This decision can be deceptively difficult since there are many nuances to consider.

Cost

This is the factor that is at the top of everyone’s mind. Discussing cost is highly dependent on what type of software you are looking to implement, but on average it will be more expensive to build a new piece of software than to buy one. There will be a much larger upfront investment to building software since you’ll have to pay developers for the development time, plus the support time to address any bugs in the new software. In comparison, buying is usually a monthly subscription cost which can greatly vary. Usually, the subscription cost will raise as your company grows or your usage increases. If you lack the initial funding or development resources for building software, your only solution may be to buy until you raise some capital.

Winner: Buy

Flexibility

Do you have one specific need that you are trying to address, or are you hoping to implement a full-fledged solution that will be flexible for your business for years to come? Buying may be a good solution if you are trying to accomplish one specific goal, but you may outgrow the capabilities of the software you bought at some point. With a custom-built piece of software, you can shape it into exactly what you need. Do you need to integrate with an obscure system that isn’t well known? Building may be your only option if that’s one of your requirements.

Winner: Build

Time

The time it takes to put your new software in use is an extremely important issue. The sooner it can be used, the sooner it can help support your business goals and you have a return on your investment. Buying will almost always be a quicker way to get new software in service than building. There may be some setup time involved but the solution is already built and waiting on you. Building a new piece of software can take months, and sometimes you don’t have that kind of time to put a solution into place.

Winner: Buy

Customization

Do you foresee the need to customize your solution to fit your business? It’s going to be much easier to customize a built piece of software since you own the code. It may be possible to customize a bought piece of software, but that could take higher costs and time to find an engineer that is knowledgeable with customizing the specific bought piece of software. It will most likely be quicker and easier to customize a built piece of software than it will be to customize a bought piece of software.

Winner: Build

Owning Your Own Data

One question you’ll have to ask yourself is how important the data is that the system will be using and how important is it to keep this data secure. As seen in recent years, data breaches have become frequent and can damage a company’s reputation. If you build your own software, you can ensure that it is built with a security-first mindset and ensure that your data is always stored securely. You also have the ability to hire a third-party auditor to ensure that you are using best practices for your data storage. When you buy software, you must trust that they are following all the best practices to keep your data safe. If you buy from a reputable company, it’s most likely your data is safe, but there could be a risk because you don’t have access to their systems to verify they have safeguards in place.

Winner: Build

Vendor Lock-In

Vendor lock-in might not be a big concern at first, but once your company grows it can be a hassle to migrate from one system to another. For example, imagine you buy an e-commerce solution for your business to expand to selling products online. After several years, the online selling business is going well, and you have thousands of orders and customers. Now, let’s say the subscription price is raising exponentially for this piece of software and you decide to move to a cheaper competitor (or build your own solution). How easy will it be to export your valuable customer and order data into a new system? If you can export it from the old solution, will it be possible to import it into the new solution without major hassles? These are considerations you must take into account when buying software.

Winner: Build

Based on all this information, there isn’t a golden rule on whether to build or buy your next piece of software. One good rule of thumb is to look at how critical this software will be to your business goals. If your core business model is dependent on this new software, I’d always recommend building since you will have the most control over your new systems (although this comes with an associated price tag). If this piece of software is supplementary to your business model (such as providing additional reporting that isn’t mission critical), buying may be the better choice to save yourself some money.

Are you having trouble making this challenging decision or in need of a trusted partner to help build or customize bought software? Exelaration has the experience to help you at any stage of your software’s lifecycle.

Lance Parlier

lance.parlier@exelaration.com

Lance is a talented full stack software engineer with experience architecting and building new software as well as maintaining existing software. He is skillful at building enterprise level software, as his previous role included development on a point of sale system for a Fortune 50 company. Lance also cofounded an e-commerce business where he developed a custom stand-alone sales platform. He prides himself on writing clean and maintainable code while instilling similar values on entry level developers. Expertise: Python, Django, JavaScript, Java, C/C++, Linux, Containerization, CI/CD