Stop Treating This Like a Binary Choice
Most “build vs. buy” advice frames it as an either-or decision. Build everything custom or buy everything off the shelf. That’s not how real businesses work.
The average company uses 106 SaaS applications. SaaS spend per employee hit $9,100 in 2025, up 15% in just two years.
Meanwhile, SaaS price inflation runs at 11.4% year-over-year while general inflation sits at 2.7%. That gap compounds fast.
But custom software isn’t cheap either. Only 31% of large software projects get delivered on time and on budget. Over a third get abandoned entirely.
So which is it? Neither, exclusively. The answer is almost always a hybrid. Buy the commodity stuff, build what makes you different, connect them with APIs.
This post gives you a structured framework to figure out which pieces fall where.
The 5-Factor Scoring Matrix
Score each factor from 1 to 5 for the specific process or function you’re evaluating. Not your whole business. One process at a time.
Factor 1: Process Uniqueness
How different is your process from the industry standard?
1 = Completely standard (invoicing, payroll, email) 2 = Mostly standard with minor tweaks 3 = Moderately customized 4 = Significantly different from competitors 5 = Entirely unique to your business
A recruiting firm that screens candidates with a proprietary methodology scores a 4 or 5. A company that does invoicing like every other company scores a 1.
Factor 2: Scale Trajectory
Where are you headed in the next 2-3 years?
1 = Stable, no significant growth expected 2 = Slow, predictable growth (10-15% annually) 3 = Moderate growth, expanding into new markets 4 = Rapid growth, doubling year over year 5 = Explosive growth, entire business model depends on scaling fast
Why does this matter? SaaS tools often price by seat or usage. A tool that costs EUR 500/month today costs EUR 5,000/month when you 10x. Custom software scales with infrastructure costs, which grow much slower.
Factor 3: Integration Complexity
How deeply does this process connect to your other systems?
1 = Standalone, no integration needed 2 = Light integration (one or two data syncs) 3 = Moderate (connects to 3-5 systems) 4 = Heavy (central hub that touches everything) 5 = Mission-critical data pipeline across multiple systems
Each integration point between SaaS tools adds fragility. Gartner estimates hidden integration costs inflate SaaS TCO by 150-200% beyond the subscription price. If you’re already spending more on Zapier automations and custom middleware than on the tools themselves, that’s your signal.
Factor 4: Compliance Requirements
How regulated is this process?
1 = No regulatory requirements 2 = Basic privacy requirements (standard GDPR) 3 = Industry-specific regulations apply 4 = Strict data handling, audit trails required 5 = Government-level security, data residency mandates
Regulated industries often can’t use shared-tenancy SaaS for sensitive data. If you need to prove exactly where data lives, who accessed it, and when, custom software gives you that control. Off-the-shelf tools give you their compliance posture, which isn’t always yours.
Factor 5: Budget and Timeline
How much flexibility do you have?
1 = Very constrained (under EUR 20K, need it in weeks) 2 = Limited (EUR 20-50K, 2-3 months) 3 = Moderate (EUR 50-100K, 3-6 months) 4 = Comfortable (EUR 100-250K, 6-12 months) 5 = Flexible (EUR 250K+, willing to invest in the right solution)
Be honest here. Custom software typically costs EUR 50,000-250,000 for an SMB project plus ongoing maintenance. If that’s not in range right now, SaaS is fine for now.
Interpreting Your Score
Add up your five scores.
5-12: Buy. Off-the-shelf tools are your best bet. Your process is standard, your scale is manageable, and your budget favors speed.
13-18: Hybrid. This is where most growing SMBs land. Buy SaaS for standard functions, build custom for the workflow that scored high on uniqueness or integration.
19-25: Build. Your process is unique, your scale demands it, and you have the budget. Custom software will deliver better ROI over 3-5 years than tools that don’t fit.
The Total Cost of Ownership Trap
Sticker price is misleading. Always misleading.
For SaaS, the real cost includes: subscription fees (growing at 8-12% annually), per-seat charges as you grow, integration costs (Zapier, middleware, consultants), training time for each new tool, opportunity cost when the tool can’t do what you need, and switching costs if you outgrow it.
For custom software, the real cost includes: the build itself, hosting and infrastructure (typically EUR 200-2,000/month), ongoing maintenance (15-20% of build cost annually), and future feature development.
One client we worked with was paying EUR 4,200/month across seven SaaS tools for their operations workflow. Three people spent 15 hours per week manually connecting data between them. That’s roughly EUR 50,000/year in SaaS fees plus EUR 45,000/year in wasted labor.
Their custom replacement cost EUR 85,000 to build and EUR 1,200/month to run. Payback: under a year.
Three Real-World Scenarios
Scenario 1: The Marketing Agency (Score: 9 - Buy)
- Process uniqueness: 2 (standard client management)
- Scale: 2 (growing slowly)
- Integration: 2 (basic CRM-to-email sync)
- Compliance: 1 / Budget: 2
Verdict: HubSpot or Pipedrive. Don’t overthink it.
Scenario 2: The Logistics Company (Score: 19 - Build)
- Process uniqueness: 5 (proprietary quoting and routing)
- Scale: 4 (doubling annually)
- Integration: 4 (warehouse, fleet, invoicing, customer portals)
- Compliance: 3 / Budget: 3
They’d tried three different off-the-shelf logistics platforms. Each one forced them to simplify their quoting process, which was the reason customers chose them. Custom was the only path that preserved their competitive edge.
Scenario 3: The Healthcare Startup (Score: 16 - Hybrid)
- Process uniqueness: 3 (custom patient intake)
- Scale: 4 (rapid growth)
- Integration: 3 (EHR and billing)
- Compliance: 5 (healthcare data, GDPR, strict audits)
- Budget: 1 (seed-funded, tight)
They bought standard tools for email, project management, and accounting. They built a custom patient intake portal that met their compliance requirements. API layer connected everything.
The Hybrid Approach in Practice
Here’s how it typically works.
Keep SaaS for commodity functions: email, accounting, project management, HR. Solved problems. Don’t reinvent them.
Build custom for your competitive differentiator: the quoting engine, the client portal, the internal workflow that makes your team 3x faster than competitors. That’s where custom software earns its money.
Connect with APIs. Your custom quoting tool talks to your SaaS accounting system, your internal dashboard pulls from your CRM.
You get the speed of off-the-shelf where it doesn’t matter and the competitive edge of custom where it does.
This is exactly what API-first architecture enables. Build your custom pieces to play well with everything else from day one.
The Decision Nobody Regrets
In our experience, the companies that regret building are the ones that skipped discovery, chose the cheapest vendor, or tried to build everything at once. The companies that regret buying are the ones that forced unique processes into generic tools for years, accumulating workaround debt until the pain was unbearable.
Run the scoring matrix. Be honest with the numbers.
This isn’t permanent. You can start with SaaS today and build custom later when the math changes. The worst decision is the one you avoid making entirely.
For a broader view of when custom development makes sense, read our complete guide to custom software development.
Not sure where your business falls on the matrix? Let’s walk through it together. We’ll map your scoring, compare the real costs, and tell you honestly whether building makes sense for your situation.
