Unless you’ve had your head under a rock for the past few years, you will likely have noticed the increase in SaaS (Software-as-a-Service) companies.
Most software vendors have begun moving towards a subscription model. It makes sense. They want predictable revenue to keep improving the software and drive new sales, keep existing customers happy and, of course, generate profit. There are plenty of advantages to using SaaS to run your business. They make it easy to get started, there’s no up-front capital investment required, and the risk in producing the software in the first place has already been mitigated.
I often advocate that businesses should start out using SaaS software, especially in the early days, before they think about investing in custom software. It enables you to start reaping benefits fast, and you learn what works and what doesn’t for your business.
But, at a certain point, you will likely find that you begin to outgrow the SaaS software. You may hit a wall, productivity-wise. Or they ’re changing the product which doesn’t suit the direction your business is heading in. You end up with a lot of features you don’t need, which adds complexity and overhead for your staff. On top of that, as your team grows so does the subscription cost.
There’s a couple of other significant factors to consider here. First, you’re renting the software and subject to the whims of that company. If you rely on this software to run your business, you’re putting your metaphorical business eggs into someone else’s basket. What if they don’t have enough customers to sustain the company? What if they’re acquired, and they’re shut down (it happens more often than you might think)? While it might be your data in it, you don’t have total control over it. Are you 100% sure you can get all your data out? Have you documented and tested this scenario? Sometimes the shutdown notices are remarkably short. You don’t want to be caught out and have to scramble to find an alternative product at short notice. How sure are you that the SaaS company is taking care of your data and doing all they can to ensure their software is reliable and secure? If they’re VC-funded, they may be under pressure to grow and ship quickly. Do you want to trust your business to an entity which could disappear just as fast?
Don’t get me wrong, for non-mission-critical software, using SaaS products makes a lot of sense. But, all these reasonably priced SaaS products soon add up, especially if you have a significant number of users. As a business owner, you need to be mindful of these costs. Do you know what they cost you each month? Are you sure they’re being utilised to their fullest and providing value that significantly outweighs the cost?
There’s likely to be a tipping point where custom software development will begin to make a lot more sense. You get the software that caters to your exact needs, with none of the features or complexity you don’t need. You will own 100% of your data and the software. It will be an asset and a competitive advantage for your company. Developing bespoke software may not be as expensive as you think. You could realise considerable savings, even taking support and maintenance fees into account.
It needn’t be an all-or-nothing proposition either. In today’s connected world, you can transition in stages. Your custom software can interact with SaaS products and leverage their functionality while it doesn’t make financial sense to bring it in-house. You also bring your data more under your control.
If you think you could be paying too much for your SaaS products or are getting overwhelmed, then you might benefit from bespoke software. Contact us for a no-obligation chat and see if it makes sense for your business.