One of the most important things that a business owner has to decide in their Ecommerce Journey, is the route they are going to take in their application strategy: package implementation, SAAS, or custom implementation. There are really important differences in all three – and the right solution depends on you and your company.

Package, SAAS, or Custom – What Do They Mean?

A Package Implementation means you’re going to:

  • Use an application that has been built for your industry that has all the business functions, data constructs, and workflows built in.
  • You’ll have the  opportunity to configure (no coding) the application with your data so the applications works for you.
  • You’ll also have the opportunity to customize (coding involved) with your specific workflows / data requirements by purchasing plugins or hiring a developer to customize the application.  Although, every time there is an upgrade from the application vendor, the customizations may need updating also.
  • Host the appication on your servers or in a shared hosting environment
  • Typical platforms can include WooCommerce, Magento, OpenCart

A SAAS Implementation means you’re going to:

  • Use an application that has been built for your industry that has all the business functions, data constructs, and workflows built in
  • Have the  opportunity to configure (no coding) the application with your data so the applicatiion works for you.
  • Have the ability to purchase approved plugins that can add functionality.
  • Not have the opportunity to customize (coding involved) with your specific workflows / data requirements  – as source code is not changeable.
  • Subscribe to the platform by paying a monthly fee to run and host the site for you – generally worry free.
  • Typical platforms include Shopify, BigCommerce, Magento

A custom implementation means you’re going to

  • Build an application with the business, data constructs, and workflows exactly as you need them for your business
  • Hire a team including business analysts and developers to design and develop this custom application
  • Customize the application to your heart’s content
  • Update and upgrade with new features whenever you want
  • Typical application development platforms could be Azure, Ruby on Rails, PHP

So, How Do You Decide?

Reasons to go with a Package Implementation:

  • Process – Your business can fit into the package.
  • People – You’ll have access to a talent pool with skills in that package, and to a community of users and support forums that discuss business and technical issues
  • Technology – You are comfortable maintaining the application and the hosting environment
  • Money – There are open source application like woocommerce that free.  But learning curve and plugins will add dollars.  Other applications charge a monthly licensing fee on a per seat basis.

Reasons to go with a SAAS Implementation:

  • Process – Your business can fit into the package.
  • People – You’ll have access to a talent pool with skills in that package, and to a community of users and support forums that discuss business and technical issues
  • Technology – You are NOT comfortable maintaining the application and the hosting environment.
  • Money – For smaller companies with limited inventory and limited orders, SAAS is a godsend.  For a fixed small fee per month + a per transaction fee – one can get started. However, when your volumes go up, and customer complexity in contract pricing comes into play, SAAS can become expensive.  Also integrations to inventory management systems become expensive. Understanding total cost of ownership at every order volume / revenue level is really important.

Reasons to go with a Custom Implementation:

  • Process – Your business cannot fit into a package or SAAS implementation
  • People – You have an in-house or outsourced IT team that is capable of building, documenting, hosting, and supporting the application
  • Technology – You are comfortable with all aspects of designing, building, and maintaining the application and the hosting environment
  • Money – More money spent up front on people, processes, and technology.  Licensing costs will be less.  Transaction fees will be less.  Maintenance and updates will be more.
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