When to Build Custom Software vs. Choose SaaS: A 10-Question Decision Framework (with quick scoring)

Why this decision matters

Tech isn’t just “tools”; it shapes how you sell, operate, and get paid. Pick wrong and you’ll suffer lock-in, patched processes, and hidden costs. Pick right and you’ll accelerate time-to-value, protect margins, and align teams.

The decision framework: 10 questions (with scoring)

Score each: 0 = favors SaaS, 1 = depends / hybrid, 2 = favors custom. Add them up and check the interpretation.

1. Does your core process differentiate you in the market?

   • Standardized → 0

   • Unique steps that drive advantage → 2
     Signal: Custom captures differentiators without forcing you into a SaaS mold.

2. Can you adopt a SaaS “default” process without losing value?

   • Yes, minor changes → 0

   • No, it would sacrifice what makes you competitive → 2

3. How many critical integrations do you need (ERP, POS, portals, finance, legacy)?

   • 0–2 standard integrations → 0–1

   • 3+ complex or uncommon integrations → 2

4. Do you have strict compliance, privacy, or data-residency needs?

   • Common, covered by SaaS → 0–1

   • Tight/sector-specific, audits, residency → 2

5. How frequently do your processes change (monthly/quarterly)?

   • Occasional → 0–1

   • Constant iteration/experimentation → 2

6. Is your permissions/roles model complex (multi-level, contractors, third parties)?

   • Simple roles → 0–1

   • Complex matrices, multi-company, third parties → 2

7. How critical is time-to-value?

   • Need to run in weeks → 0 (SaaS is ready)

   • Can iterate 8–16 weeks to nail the fit → 1–2

8. Do you prefer predictable OPEX or CAPEX to build an asset?

   • Low, predictable OPEX → 0 (SaaS)

   • CAPEX/mixed to build a strategic asset → 1–2

9. Is data portability/ownership strategic?

   • Basic exports are enough → 0–1

   • Need your own data model, ETL/ELT, granular audit → 2

10. Low tolerance for vendor lock-in?

    • High tolerance (SaaS covers 80%) → 0

    • Low tolerance; need roadmap control → 2

How to read your score

• 0–8 → SaaS: go for fast adoption.

• 9–14 → Hybrid: combine specialized SaaS with custom modules/integrations.

• 15–20 → Custom: you need tight control over process and data.

AmpleMax Tip: ~70% of our clients choose hybrid—e.g., Facepass (biometric attendance SaaS) + payroll integration; Btracker (GPS/photo checklists) + custom reports; Habitrack (real-estate post-delivery) + contractor-specific flows; SalesMind (Sell-In/Out & Collections BI) + ERP/portal connectors.

TCO (Total Cost of Ownership): what to compare (24–36 months)

Typical SaaS costs:

• Licenses per user/site/module

• Onboarding/parameterization

• API/export limits and add-ons

• Paid change requests (if any)

• Integration costs (iPaaS or connectors)

• Training and change management

Typical Custom costs:

• Discovery/UX, architecture, development

• Infra (cloud, security, backups, monitoring)

• Automated QA, CI/CD, observability

• Corrective/evolutionary maintenance

• Integrations (APIs, ETL/ELT, webhooks)

• Documentation, handoff, support

Hidden costs to watch:

• SaaS: usage caps, “enterprise” features, roadmap dependency, exit costs (data/process migration).

• Custom: scope creep, weak change governance, technical debt.

Risks & mitigations

• Lock-in (SaaS): require data portability, full exports, API access, and define an exit plan on day one.

• Delivery & quality (Custom): use phased MVP, a clear backlog, acceptance criteria, bi-weekly demos, automated tests, and health metrics (incidents, lead time).

• Security & compliance (both): strong IAM, encryption, audit trails, environment segregation, pen tests, and regular audits.

Three common scenarios (with AmpleMax solutions)

1. Construction with distributed staff

   • Need: attendance/incidents control, pre-payroll, payroll processing.

   • Recommendation: Facepass (SaaS) + payroll integration and custom company policies (overtime rules, multi-site, per-project rules).

   • Outcome: fewer payroll errors, solid audit evidence, reduced absenteeism.

2. Real-estate developer & post-delivery service

   • Need: pre-handover inspections, traceability of defects, contractor management.

   • Recommendation: Habitrack (SaaS) + custom flows by unit type and executive/legal reports.

   • Outcome: faster response times and higher NPS.

3. CPG / Modern retail

   • Need: unified visibility of Sell Out, Sell In, and Collections with actionable alerts.

   • Recommendation: SalesMind (SaaS) + ERP/portal connectors + custom exec dashboards for finance/ops.

   • Outcome: weekly decisions from a single source of truth and lower DSO.

Recommended roadmap (hybrid)

1. Weeks 0–4: Discovery & quick wins

   • Process map, KPI definitions, risks/success.

   • Trial 1–2 key SaaS (PoC) and evaluate integrations.

2. Months 2–3: Operational MVP

   • Implement chosen SaaS + 1–2 critical integrations.

   • Minimal custom module to cover the main gap.

   • Training and adoption measurement.

3. Months 4–12: Scale-up

   • Automations, more integrations, security hardening.

   • Executive BI dashboards and process tuning.

Get a Free 20-Minute Consultation

Bring your context (process, integrations, KPIs). We’ll recommend SaaS, Custom, or Hybrid, estimate 36-month TCO, and outline next steps.