Most companies should buy their accounting system, their email, their CRM, and their payroll. Most companies should not buy the system that runs the thing they are known for. The hard part is telling which is which before you have spent the money.
Here is the checklist we walk through with clients. Answer each honestly. The pattern of answers tells you more than any single one.
Is the process a commodity or a differentiator?
- Does every company in your industry do this the same way? If yes, buy. Packages are built for the average, and average is what you want here.
- Do you win business because of how you do this? If yes, be careful. A package will pull you toward how everyone else does it.
- Would a competitor pay to know how you do this? If yes, it is a differentiator, and differentiators are usually built.
Will the package actually fit?
- How many of your must-have requirements does the package meet out of the box? Below about eighty percent, the customizations and workarounds start to cost more than the license.
- How many systems does it have to talk to, and does it have real integrations for them? “Has an API” is not the same as “integrates with your ERP.”
- What did the vendor’s reference customers have to give up to make it work? Ask them. They will tell you.
What does it cost across five years, not year one?
- Add the licenses, the implementer, the customizations, the integrations, and the internal time to work around it. Off-the-shelf is cheap in year one and often is not by year three.
- What happens to the price when you grow? Per-seat and per-transaction pricing scales with your success, not with the vendor’s effort.
- Who owns the data and the customizations if you leave? If the answer is not you, price the exit in.
Who carries the risk?
- If the vendor changes direction, raises prices, or is acquired, what happens to you? With a package, their roadmap is your roadmap.
- If your business changes, how fast can the system change with it? A change request to a vendor is measured in quarters. A change to software you own is measured in weeks.
- Is there a person on your side who can own the decision? Both paths fail without one.
The common third answer
The real choice is rarely all-custom or all-package. The most common right answer is to buy the commodity parts and build the piece that makes you different, then connect them properly. Keep QuickBooks or the ERP for what it does well. Build the operations layer, the customer experience, or the data and reporting that the package will never do your way. Numbers you can’t trust usually live in the gap between two packages, not inside either one.
How to decide with facts instead of a sales deck
If you are still unsure after the checklist, that is normal, and it is what a fixed-fee planning step is for. For a system you already run, a System Evaluation tells you what you have and whether to fix, extend, replace, or connect it. For something new, a VDP Sprint turns the idea into a scope, a cost, and a build-versus-buy recommendation you can take anywhere, including to a package vendor.
The longer version of this analysis, with the total-cost math, is in Build vs. Buy Software Analysis for Growing Companies. If you want to talk it through, here is how getting started works.