Productivity and technology investment · Free
SaaS vs custom software calculator
Per-user licences look cheap until the team grows. Compare the cumulative cost of a SaaS with building your own, and see where the lines cross.
SaaS (licences)
Custom software
This is an indicative comparison of direct costs. For a real estimate of the build, tell us what you need.
Guide
How to compare SaaS and custom software costs
SaaS is pay-as-you-go: users × licence price × 12 months, every year, with whatever price rises the vendor decides. Custom software has a high upfront cost and a low yearly cost afterwards: maintenance and hosting.
To compare them properly you need the cumulative cost over several years. The calculator adds both up, year by year, and shows when building starts to work out cheaper.
Example with 20 users
A CRM at €35 per user per month with 20 users costs €8,400 in year one. With a 5% yearly increase it adds up to about €46,400 over five years.
A €30,000 build with 15% yearly maintenance (€4,500) and €60 a month of hosting adds up to about €56,100 over five years. Here the SaaS is still cheaper after five years; with 40 users the custom build would pay back around year three.
What the sums leave out
A SaaS is ready tomorrow, someone else maintains it and it comes with features you might never afford to build. In exchange, custom software fits your process and its price doesn't depend on a third party's decisions.
Many companies end up with a mix: SaaS for the standard parts (accounting, email) and custom software for what sets them apart or to connect the tools together.
How it works
- Enter how many users you have and the licence price.
- Enter an estimate for the custom build and its maintenance.
- Compare the cumulative cost and the year the two lines cross.
Frequently asked questions
When is custom software better than SaaS?
When you pay for many licences for years, when the SaaS forces you to change how you work, or when you need to connect systems that do not talk to each other. If a standard SaaS covers your needs and you have few users, it is usually the better choice.
How much does maintaining custom software cost?
As a rule of thumb, 15–20% of the build cost per year: fixes, security updates and small improvements. That is why the calculator defaults to 15%.
Why is there a yearly SaaS increase?
Because licence prices go up. Many vendors have raised prices by 5–10% in recent years, and advanced features usually cost extra.
What does this comparison leave out?
Implementation and training (which exist in both cases) and the value of shaping the software around your process, which is often the main reason to build it.
Do you do this every day?
If you merge documents, prepare invoices or copy data between programs every day, that can be automated, and it's what we do.