Build vs Buy Software: Breaking Out of the Dilemma

Quick Summary: While software is critical for modern businesses, making a choice between building and buying software causes a dilemma. In this article, we will understand software build and buy options in detail to help you solve this riddle. Keep reading to make the right decision by obtaining the necessary information this article provides you.

Businesses need software to automate workflows, increase efficiency, boost productivity, and provide countless other benefits. Plus, software can be a basis for new business offerings. Hence, it plays a pivotal role in modern enterprises.

Today, the software market is growing exponentially with the increasing demand for digitalization. The enterprise software market size is worth $263.79 billion and expected to rise with a CAGR of 12.1% over the period of 2025 – 2030, as per GrandViewResearch.

When it comes to acquiring new software, there is a big dilemma in front of them – build vs buy software. Though it seems a trivial matter, there are long-term consequences of such a decision. Therefore, you must invest plenty of time to decide.

You’ve landed in the right place, as this article can help you overcome the build vs buy dilemma with detailed explanations of each option. You will have plenty of details to make an informed decision after reading this article. So, let’s begin.

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First Thing First, A Quick Overview of Build vs Buy Software

Let’s begin by understanding what building software means. It involves creating software solutions from scratch with custom features and UI/UX design. It also involves identifying the specific needs of a business and then designing and creating a software solution that meets those needs.

Think of it like constructing a home starting with an empty space. In a similar way, you build software with a mere idea. Like a home, you must build different parts of software solutions that constitute its features. Hence, it’s a long process with different steps.

Most major enterprises choose to develop software from scratch to meet their unique needs. As we look at the statistics, 84.7% of software development projects involve creating enterprise applications. The primary reason is enterprises have the resources it takes to develop custom software solutions.

Now, buying software means finding, selecting, and purchasing an off-the-shelf solution and deploying it in your organization as-is or with minor modifications. This means, that you buy ready-made software that aligns best with your business needs and pays regular or lump sum fees.

Think of it like purchasing a ready-to-move home. It’s already constructed based on the design and planning of a real estate developer. In this case, you won’t have control over the design, artifacts, and other elements of your home.

Pros and Cons of Building Software

Developing software from scratch provides many benefits, but there are a few drawbacks as well. It’s important to check out these pros and cons to make a better decision. Let’s check these pros and cons below.

Pros

Tailored to Business Needs

One excellent benefit of building software from scratch is tailored solutions. This means that the software is designed and developed to meet your unique business needs and challenges. It offers specific functionalities that are useful for your business.

Great Flexibility

Another advantage of custom-built software is greater flexibility than pre-built solutions. You can easily adjust or tweak custom-built software as your business grows and changes.

Security and Compliance

Building software from scratch enables you to ensure that it meets compliance and security standards. You can keep the bar high and implement the strongest security measures for your software.

Easy Integration

Tailored software integrates into your IT ecosystem flawlessly because it’s designed for your business specifically.

Differentiation

You can differentiate software from other businesses by implementing unique functionalities when creating a custom one.

Cons

Resource-intensive

Creating custom software requires a lot of resources (human + capital). Hence, it is a resource-intensive process for developing software solutions.

Higher Initial Costs

Upfront costs are high in the case of building software. You will need a team to outsource software development to create it.

Delayed Time-to-Market

While off-the-shelf software is a finished product and can be deployed just after acquiring it, the custom one will take a lot of time in development, testing, and deployment. Hence, the time-to-market is delayed in this case.

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Pros and Cons of Buying Software

Buying software means a quick solution because they are readily available. There are many other benefits to them and a few drawbacks as well. Let’s check out the pros and cons below to make an informed decision.

Pros

Ready to Deploy

The prime advantage of purchasing a software solution is that it can be promptly deployed. It means, the software is in ready mode and requires minimal or no configuration to start using it. Consequently, it reduces deployment time and cost.

Easy to Use

Off-the-shelf software solutions are comparatively easy, and the learning curve is modest. As a result, such software is useful for businesses that need to integrate new solutions rapidly.

Reliable

Since off-the-shelf software solutions have been used and tested by an existing customer base, their reliability is verified. Hence, they are considerably reliable.

Feature-rich

Ready-made software offers more features than custom-built solutions because they are built for a wide variety of use cases. They solve a common problem. Hence, they have features that are needed by every type of business.

Cost-effective

Another advantage of buying software is the lower initial cost. Acquiring new software by purchasing it will cost only a fraction of what it would cost to build it from scratch.

Cons

Limited Customization

Off-the-shelf software solutions are either inflexible or offer limited customizations. Hence, you cannot modify them to meet your unique business needs. They could fail to meet some expectations of your business.

Unnecessary Features

Generally, off-the-shelf software is loaded with lots of features. Many of these features are not useful for a particular business. Hence, they pay for functionality that they would never use.

Vendor Lock-In

An unpleasant situation that may occur when buying software is vendor lock-in. In this case, businesses are excessively dependent on vendors for software updates and maintenance. Besides, it might be difficult to move to another vendor.

Additional Cost

Ready-made software may fail to offer all the functionality the businesses need to integrate with other systems or optimize workflows. It would lead to additional costs in implementing such functionality.

Factors to Consider Determining Whether to Buy or Build Software

The decision to buy or build software depends on multiple factors, as given below. These factors determine what you should look at when choosing a specific option. So, you can make a good decision by considering these factors.

Quality

Quality is a critical factor in deciding whether to buy or build software. It could be difficult to achieve the same level of quality as with custom software development. In the case of commercial software, you get a predefined set of functionalities.

Flexibility

Another crucial factor to come out of the build vs buy dilemma is flexibility. It denotes the ability of software to accommodate changes. If your business is continuously changing, you need highly flexible software that you can only get by building a custom one.

Time

Obviously, developing software takes longer than buying one from a vendor. Hence, you must identify your requirements for the final decision – buy or build software.

Risks

Risk is also a critical factor to consider when making a choice between build and buy options. Each option has its own benefits and risks. So, you must carefully evaluate these options to determine the most suitable option.

Cost

Cost plays a crucial role in making the right choice between building or buying software. Moreover, the initial cost of a custom software solution is high and low for off-the-shelf solutions. If we look at it from a long-term perspective, then custom development has more benefits.

Competitive Edge

In this highly competitive world, building a unique solution is crucial to stand out from the rest. If you can buy a software solution, so do the competitors. As a result, you will have a solution that is similar to others. However, if you build software from scratch for your business, you can customize it and make it stand out from competitors with unique features.

Buy vs Build Software: What Should You Choose?

Now that you know the benefits and downsides of the build or buy decision, let’s ponder upon the most important question – what you should choose, buy or build? It’s not an ordinary question because there is a long-term commitment, and a wrong decision can risk your organization’s future.

Hence, you must consider different factors carefully to make the right decision. However, the actual decision depends on business requirements and goals. For example, if your project’s timeline is very low, buying a software solution is a perfect choice.

On the other hand, you will benefit more from building a custom solution if you need something that is aligned with your business. However, developing a custom solution requires you to find a reliable software development outsourcing partner to build the right solution.

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To Wrap UpBuild vs buy is a critical decision that every business must make at some point in time. When it comes to buying software, you must consider many factors like price, learning curve, vendor support, security, and more. These factors can help you choose the best software solution for your business. If you want to build a custom solution, you need to choose a reliable software development team.We have the best team of custom software developers who are proficient in the latest technologies. Our developers can implement advanced technologies like AI, ML, and IoT to build best-in-class solutions. Leverage our years of experience and expertise to build a top-notch solution for your business.Get in touch with our experts for more information on how we can help you excel in software development.