Build vs Buy Software: Which Is Better For Your Business?

Build vs Buy Software

A build vs buy software decision stands as one of the most challenging decisions facing enterprise organizations today.

As competition grows and technology lifecycles shorten, weighing the pros and cons of building and buying may feel overwhelming and hectic to even the most experienced of teams—but how do you make the right choice for yours? Before deciding to build your own software solution in-house, make sure you’ve examined all costs, commitments, and potential setbacks that come along with the undertaking.

Build vs Buy Software Statistics

In 2019, IT budgets increased by an average of 20% to accommodate platform modernization and larger projects but:
  • 52% of large IT projects go over time, over budget, or require sacrificed functionality.
  • Harvard Business Review found that one in six IT projects have an average cost overrun of 300% and a schedule overrun of almost 70%.
  • 56% of IT projects fall short of the original vision, according to McKinsey.
  • One estimate of IT failure rates is between 5% and 15%, which represents a loss of $50 billion to $150 billion per year in the United States.

Building software often results in higher costs, longer timelines, and reduced functionality.

Build vs Buy Software Analysis

While it may initially seem appealing to build a fully-custom software solution in-house, the time, money, and resources required to succeed are often dangerously underestimated. Use our chart below to compare the outcomes of each strategy and determine which is most effective—and cost-efficient—for you and your teams.

Time to Value/Opportunity Cost

  • Build

    • Regardless of whether you build or buy, your goals are your highest priority: Will the solution you’re planning to develop fully meet your long-term requirements? How successful will the product be throughout its entire lifecycle—from initial deployment to ongoing maintenance—as your business and use cases change? Building your own solution means accepting a longer time to value, or reaching a point where you can measure tangible results against your goals. Most often, this takes a minimum of 6 months to one year.
  • Buy

    • If you can’t afford to wait 6-12 months to see results, purchasing a SaaS platform could be your golden ticket. Choosing a technology partner that understands your goals and the inner workings of your business greatly decreases your time investment and allows you to be up and running within weeks, not months. You also have the annual option to review the solution value and pivot if your business requirements change.

Cost & Maintenance

  • Build

    • When you are the software builder, you will own all expenses of the platform from start to finish; and in a typical software build, only 20% of those costs are dedicated to initial building and rollout. The remaining 80% is spent on ongoing support after launch, like bug fixes, upgrades, platform migrations, and more—not to mention the high-profit opportunities you’ll set aside to accommodate new internal resources and staff.
  • Buy

    • Since your SaaS partner works across a large consumer base, it gains efficiencies that simply aren’t attainable with a one-off application. As a result, your partner is able to charge a lower amount than what you’d be paying in monetary costs when choosing to build, and your subscription fee covers all costs and charges for ongoing maintenance and bug fixes.


  • Build

    • Building grants you complete control over the functionality of the platform—but this comes along with a great deal of responsibility and potential risk. When technology isn’t your primary business or specialization, designing details in-house could lead to uninformed features that can’t be properly maintained, and/or staff changes may pose future challenges when modifications to the code are required.
  • Buy

    • While choosing a SaaS vendor may feel restrictive, many on the market offer flexible configurations and integrations to meet your requirements and specific goals. You will never have complete control over a third-party software platform or its product roadmap, but you will have the opportunity to share feedback and suggestions for future development. You’ll also work with highly-experienced and knowledgeable teams who will ensure seamless launch, integration, and consistent management of the platform.

Find the right solution with help from FORM. Let’s work together to make sure you’re choosing the best software solution for your teams.

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