SaaS vs. Custom-Built Software: Which is Best for B2B E-commerce?

Companies navigating digital transformation often face a key decision: should they leverage Software as a Service (SaaS) or invest in developing their own custom-built solution? This choice impacts not only costs but also the flexibility, scalability, and long-term software manageability within a company’s ecosystem. In the B2B e-commerce sector companies like Colect provide SaaS platforms tailored to the needs of fashion brands, offering solutions that strike a balance between customization and rapid deployment, without the substantial initial investment needed for custom-built software.

What is SaaS?

Software as a Service (SaaS) is a cloud-based delivery model that provides software applications to users over the Internet. Rather than installing and maintaining software on local servers or personal computers, businesses can access applications hosted by a provider. This approach enables flexibility and scalability, making it especially appealing for companies looking to grow without investing heavily in IT infrastructure.

SaaS solutions are subscription-based, which means businesses pay a recurring fee rather than a large upfront cost. Well-known examples of SaaS include Salesforce, Google Workspace, and Zoom. SaaS allows companies to avoid the complexities of managing their software stack, as updates, security, and maintenance are handled by the provider.

Key Differences: SaaS vs. Custom-Built

Cost Structure and Payment Flexibility

One of the most compelling benefits of SaaS is its predictability, which means companies can scale their usage according to need. Unlike custom-built solutions, which involve a significant one-time investment in development, SaaS enables businesses to budget for manageable monthly or annual fees. According to Amazon Web Services, “SaaS can be ideal for organizations looking to reduce capital expenditures” while still accessing efficient software, as the cost is spread over time instead of requiring a large upfront payment.

Colect’s Digital Tools, for example, offers fashion brands a customizable platform for wholesale management without the prohibitive costs of building a similar system from scratch. This user-based pricing allows brands to manage expenses effectively, expanding usage only as their team grows.

Customization and Flexibility

Custom-built solutions allow for deep customization to fit specific business processes; however, this comes at a high cost. Development timelines are typically longer, with a need for ongoing investment in IT resources and maintenance. SaaS, on the other hand, offers customizable features within a standardized framework. Companies can often choose from a suite of modules or integrate various SaaS products to tailor the software to their workflow.

SaaS providers like Colect prioritize flexibility, allowing brands to incorporate custom branding, pages, links and even integrations with third-party solutions into the software. This offers customers the personalization they need while maintaining rapid deployment and ease of use—a core benefit of SaaS that’s difficult to achieve with custom-built solutions.

Deployment and Maintenance

SaaS solutions are designed for rapid deployment. As this article by SAP points out, SaaS platforms can often be launched within days or weeks, allowing companies to start using the software with minimal delay. In contrast, custom-built software requires a long development phase, with potential delays and higher costs if scope changes occur during development.

Maintenance and updates in the SaaS model are handled entirely by the provider, allowing businesses to focus on their core operations without losing time with software upkeep. It’s often something less to worry about. In the case study we did with the German sustainable brand ARMEDANGELS, this was highlighted of one of the main benefits of using our platform: “The main benefits for them (the sales team) is the dependability of the platform and the fact that they no longer need to occupy themselves with the technicalities of digital sales - it just works. The time saved can be spent entirely on client contact and doing what they do best: sell their collections.”

Advantages and Disadvantages of SaaS vs. Custom-Built for Fashion Brands

Advantages of SaaS

  • Lower Initial Investment: SaaS eliminates the high upfront costs typical of custom-built solutions, making it accessible for companies of all sizes.
  • Flexible, Subscription-Based Pricing: SaaS platforms offer tiered pricing, allowing companies to only pay for what they use. This user-based pricing enables businesses to scale efficiently as their needs evolve.
  • Quick Deployment and Minimal IT Involvement: SaaS solutions can be implemented quickly, often within weeks, without extensive IT infrastructure.
  • Automatic Updates and Security: SaaS providers handle all updates and security protocols.
  • Scalability on Demand: SaaS platforms grow with the business, enabling seamless scaling without the complexities of expanding an on-premise system.
  • Continuous Innovation at Scale: SaaS providers invest heavily in research and development, ensuring their platforms remain cutting-edge. With a SaaS model made for fashion, brands benefit from ongoing improvements and new features that are based on the market’s needs.
  • Community-Driven Enhancements: SaaS platforms draw on feedback from a broad community of users - in the case of Colect, from a wide range of fashion & lifestyle brands -, enabling them to address shared needs and introduce features that benefit the entire user base. 

Disadvantages of SaaS 

  • Limited Deep Customization: While SaaS may not reach the level of customization possible with custom-built solutions, many SaaS platforms offer customization options that cover a wide range of business needs. Colect’s Brand Portal, for example, is a personalizable b2b E-commerce solution that allows fashion brands to customize the site with their logos, fonts and branding, promotional banners, special pages, links, and much more, providing flexibility without extensive development.
  • Data Storage and Ownership Concerns: In SaaS, data is stored on the provider’s servers. However, many SaaS vendors implement strict compliance measures and data security protocols. 
  • Ongoing Subscription Costs: While SaaS requires a recurring payment, it also spreads the cost over time, avoiding the significant one-time investment typical of custom-built solutions. Over the long term, the SaaS model offers predictable budgeting without the risk of unforeseen maintenance expenses.

Advantages and Disadvantages of Custom-Built Solutions for Fashion Brands

Advantages

  • Full Customization: Custom software can be tailored exactly to a company’s processes, offering a perfect fit for unique needs.
  • Complete Data Control: With on-premise or own-built solutions, companies can have full control over data storage and security.

Disadvantages 

  • High Initial Costs: Custom-built solutions require a substantial investment upfront. In contrast, SaaS allows companies to avoid this cost by spreading payments over time, offering a cost-effective alternative for budget-conscious businesses.
  • Long Development Time: Custom-built solutions often take months or even years to fully implement, delaying time-to-value. SaaS provides a ready-made solution that’s deployable within days or weeks, enabling businesses to adapt quickly to market changes.
  • Resource-Intensive Maintenance: Custom-built solutions require ongoing maintenance and security management by internal teams. By using SaaS, companies can outsource this burden, as providers handle maintenance, updates, and security protocols.

Why Choose SaaS for B2B E-commerce?

Choosing between SaaS and custom-built solutions ultimately depends on a company’s needs, budget, and IT capacity. For many fashion brands, SaaS offers a compelling balance of affordability, flexibility, and security. Companies like Colect provide SaaS solutions specifically designed to meet the unique demands of the fashion industry, offering brands a customizable yet readily available platform to manage their digital assets and B2B operations. This enables businesses to focus on growth rather than software management, making SaaS an attractive choice for companies aiming to stay agile in a competitive market. In some cases, Colect also co-develops together with a selected number of customers to bring them the best of both worlds: the benefits of Saas and the specificity of a custom-built solution.

By considering the long-term benefits of scalability, low maintenance, and reduced financial risk, SaaS platforms present a forward-looking solution that empowers companies to prioritize their core business without the complexities of managing custom-built software.

Do you want to learn more about what Colect’s toolkit is all about? Download the brochure