What does custom software cost for a small business – and is it worth it?

If you’ve reached the point where you know your software is holding you back, and none of the alternatives seem any better, the idea of custom software has probably crossed your mind. But maybe there is one question holding you back – what is this going to cost me?

It’s a good question to ask – but it’s one that is almost impossible to find an answer to by looking on companies’ websites. Links to pricing sections skirt around giving a direct number or funnel you to a form to fill in for a quote. This approach isn’t done to be sneaky, but it’s maddening when all you want is a sense of whether you are looking at the cost of a week’s holiday or whether it’s closer to a whole new house.

So here is our attempt at explaining why it’s so hard to give a number – and give you a rough indication of price ranges.

Why there’s no single price tag

The honest reason that companies don’t display build costs on their websites is because custom software isn’t a product as such. Think of pricing custom software as similar to pricing an extension to be built on your house. Nobody can give you a cost until you know the size, its intended purpose, or the existing foundations.

It sounds like dodging the question, but it’s not. Understanding the factors that influence the cost will give you a more meaningful idea of what the price will look like for you before speaking to anybody.

What actually drives the cost?

A handful of factors have biggest impact on cost:

• Scope – how much it does. Automating one nagging process will cost less than a system that runs your whole operation. The more the software is responsible for, the more there is to design, build and test.
• Integrations – how many other tools it needs to talk to. Connecting to accounting packages, websites, supply systems etc all add work – and the time and cost varies a lot depending on how cooperative their tools are.
• Your data – the quantity and the state it is in. If years of records need migrating and sorting before it can be imported and used, this adds time.
• The inner workings of your business – the more unusual practices you follow, the longer it takes to build. Standard, predictable logic is quicker to build.
• Users and scale. Software for a team of five will require less resources than software for a team of five hundred. 
• Life after launch. Although the build is a one off purchase, requirements such as hosting, updates and feature additions in the future can increase cost.

These are all things we’d talk you through in order to find a solution that fits both your problem and your budget.

What you get at different budgets

The truth is – it depends. We can only provide an accurate quote once we have spoken to you and conducted a full assessment of your problem and your set up. But we know that doesn’t help much in the feasibility stages – so here are some guidelines based on previous projects we have worked on.

• From around £1,000 – a focused piece of software that automates one standard task, or a single integration that removes the need for manual data transfer. The sort of solution that gives you back an afternoon each week.
• From around £5,000 – a custom tool or module built to automate one area of your business. This could be one large process or a network of smaller connected processes that have become a liability.
• From around £15,000 – a fully custom system that ties your whole business together, encompassing several processes and integrating several disconnected tools. This will become the central point for your business admin.

This is simply a guide – not a guarantee. Depending on your requirements, your project may cost more, or even less, than these.

An investment, not just a cost

The upfront cost of custom software is undeniably greater than that of off the shelf software. A monthly subscription will almost always cost less, so why pay more?

Think of it like a suit – an off-the-peg one passes. It’s much cheaper, and if you fit into standard sizes – it may be all you need. But for the majority, you’ll always have a nagging feeling in the back of your mind that it isn’t quite right. Over the years, you pay for tailoring and tweaks, trying to make it look right. Eventually, it’s unrecognisable from the original, and still not quite right. You end up headed to the shops to buy a new one, and the cycle begins again. The cost of this suit goes far beyond what you paid at the till on the day you brought it home.

Off-the-shelf software that doesn’t quite fit acts in the same way. Initially, you pay less. But over the years you end up paying with both time and money. Workarounds, backup spreadsheets and features you pay for but never touch are just a few of the ways are all costs that exist, but don’t show on the invoice. That’s the difference between cost and investment. A cost is money that leaves and never comes back, but an investment is money that gets to work for you – software that fits how you operate, takes away the daily drag, and continues to save time and money long after it has paid for itself. The upfront cost is bigger because you are buying something that’s yours and is built to last – not renting a compromise.

When custom isn’t worth it

This may be the last thing you expect to hear – but sometimes custom software isn’t worth it. If what you need is a common problem in your industry that doesn’t deviate from the standard – there is a strong chance that there is already a well made off-the-shelf product that can do the job for less. 

And if your tools work well but data isn’t flowing well between them, you may only need a bespoke integration. Which is a much smaller job than a whole new piece of software. 

We’ve written separately about how to tell whether you should buy, integrate, or build. It’s worth a read to help you work out what you may be looking at.

These are things that we are always upfront with you about during the planning phase. If we don’t think custom software is a good investment for you – we’ll tell you straight. Selling you something you don’t need wouldn’t serve either of us well.

Interested, but worried it might be out of budget?

A number that looks too big at first rarely means that the project can’t be done. Usually, it just means we split the project into more manageable phases.

If budget is a concern – and it often is for SMEs – we will sit down and work out which parts take priority. What will remove the biggest challenges, and quickly? We will build this first as a stand alone. We get this working and earning its keep, and then we can look at expanding it to solve other problems too. It’s rarely all or nothing.

A well thought out first phase can solve the worst of the problem for a smaller cost, and the time and money it saves can pay for whatever comes next.

For years, small businesses have had just as great a need for custom software as the big players – just without the funds to build it. We passionately believe that good software should be accessible to businesses of all sizes.

So, is it worth it?

The real question isn’t only “what does custom software cost.” It’s “what is the current way of working costing me?” – because the real cost of making do is often higher than you realise.

If you’d like a genuine sense of what your situation would involve – a conversation, not a commitment – tell us what’s frustrating you and we’ll give you an honest analysis of  your situation and guidance on the best next steps for you.