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Build vs. Buy: 5 questions to ask before deciding on custom software development

Starting a Business

To build or not to build? That is the question (that most startups face at some point in early stages). Software is vital to the growth and sustainability of any modern business. Money’s tight, but customer success and return on investment can’t be ignored. These five questions can help you determine whether to build custom software or opt for an off-the-shelf solution.

1. What’s your budget?

Building software is usually the more expensive choice, but it can potentially have a huge return on investment.

To help get an understanding of your potential returns, determine the MVP (Minimum Viable Product). That is, define your software’s must-have features. Once you’ve established the MVP, you can get a few development quotes to help you decide if the custom investment is worth it.

In the U.S., decent custom development ranges from around $50 per hour up to $300 per hour. It’s expensive! And usually requires more time to build, test, and integrate than a shelf solution.

If you’ve decided you’ve gotta have something custom, then definitely do your homework and research the heck out of development companies and freelancers. As an extra precaution, find a company or person who’s successfully built software similar to yours.

You can get better rates overseas, and there’s some incredible work coming out of Poland and Serbia. But keep in mind, you’d have to decide if the time difference and extra project management requirements are worth the savings.

On the flip side…

If you’re feeling more drawn to an off-the-shelf platform, then make sure you’ve accounted for all of the setup and registration fees as well as any yearly or monthly costs.

Check out our build or buy cost calculator to help you make the right decision.

2. Are you tech literate?

It can be tough to find and keep good engineers, but technical knowledge is invaluable when it comes to a buy vs. build analysis. Custom software development can get super complicated, and if you don’t have programming or engineering chops, you might want an engineer on your team to help you decide what’s best. Your engineering teammate can also help manage the third-party that’s building your custom software – and translate techtalk to laymen’s terms.

3. What can you live without?

You might do some research on customizable templates out there and conclude that an off-the-shelf product can perform seven out of ten required tasks. How can you determine if seven out of ten features will suffice? Ask yourself these questions:

  • Will not having the missing features hurt my return on investment or profits?
  • Will not having the missing features hurt my relationships with customers or prospects?

If the answers are no, then you can probably live without those three features.

4. Can an integration tool tie-up loose ends?

There are plenty of customizable templates out there, but not all of them will suit your every need. However, you’d be surprised at the number of integrations available through tools like Zapier and IFTTT that can solve some of these customization and automation issues with over 500 integrations.

For example, say you’d like your shelf solution to integrate well with QuickBooks. You do some digging and find that Zapier can set up a daily ping to send the required information from your template to QuickBooks – score!

5. How much time will this take?

Time is a startup’s most precious asset and this question can often tip buyers over one side of the buy vs. build fence. Will custom software require months of coding while an off-the-shelf solution will take only a couple of weeks to implement? Be keen on getting a product out the door and getting some paying customers.

Make sure that any custom software development quotes include a timeline. Ask shelf-solution companies what their integration process is like and how long it takes to get set up on their platform.

Focus on Relationships and Returns

Ultimately, it comes down to what’s right for your business and your customers. Keep return on investment and relationships top-of-mind, and you’re sure to make a sound decision.

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