For most everyday jobs, buy. When you weigh build vs buy software for small business, an off-the-shelf subscription that already does what you need should be your starting assumption, because someone else has tested it and keeps it patched. Building a small custom system makes sense when the way you work is part of what sets you apart, when no product fits without awkward workarounds, or when you pay for several subscriptions that still leave staff retyping the same details. Either way, look after your customers' information during the move, and know who owns what before you commit.
When buying a subscription is the right answer
Accounting, payroll, email, a shared calendar, a simple online shop, a standard customer list: these are solved problems. Many businesses need the same thing, so a product company can build it once and maintain it for everyone.
Off-the-shelf products tend to be cheaper, quicker and easier to put in place than anything built for you, and reliable because many other users have already tested them.
Buy when:
- the job is common to most businesses and you do it the usual way;
- a product does what you need through its settings, not through workarounds;
- you can trial it with your own work before you commit;
- you can export your data in a usable format if you leave.
Start with the tools you already pay for. Check what they can do, including features you have never switched on, before you add anything new.
When a small custom system wins
Custom does not have to mean large. A small system built around one process, such as quoting, bookings or job tracking, can replace a spreadsheet and a lot of copying and pasting.
Consider building when:
- your process is unusual and is part of why customers choose you;
- staff enter the same details into several tools because the tools do not talk to each other;
- you are bending a product so far that its updates keep breaking your workaround;
- you want the records in one place, in accounts you control.
Be honest about the other side of the ledger. Custom software can be tailored to your specific business problems and is usually more flexible than an off-the-shelf product, but it tends to cost more at the start and carries ongoing support and maintenance costs. A custom system is something you own and also something you must look after.
Small does not mean casual. Even a modest system needs someone to decide the rules, test it with real work and keep it patched, so count that care in before you commit.
Build or buy at a glance
| Question | Buying a subscription | Building a small custom system |
|---|---|---|
| Fit | You adapt your process to the product | The system is shaped around your process |
| Paying | A recurring fee for as long as you use it | A build cost first, then hosting and care |
| Updates and security patches | Handled by the provider | Handled by you, or by a developer under a care arrangement |
| Your data | Held in the provider's systems, so ask where it is stored and how you export it | Held in accounts you control |
| Who owns it | You pay to use the provider's product on the provider's terms | You can own the code, if the contract says so |
| Changing your mind | Cancel, export your records and move on | Keep the code and take it to another developer |
How to decide, in order
- Name the problem. Write the business problem in a sentence, not the tool you think you want. Do not adopt a tool for the sake of it: list the business problems or goals it should help with.
- List must-have and optional features. Keep the must-have list short and tied to what you need now, not what you might use later.
- Trial two or three products with your own work. business.gov.au advises testing or trialling digital tools before buying.
- Work out the total cost of ownership. That is the upfront cost plus the running costs over the tool's life span, for the subscription and for the custom option alike.
- Ask the data questions. Where is customer information stored, who can see it, and how do you get it out?
- Only then ask for a custom quote. Take your list to a developer and ask for a written scope. If the reply is that a product already does this, you have saved yourself a build.
Privacy obligations when customer data moves
Moving to a new tool, bought or built, means moving customer records. business.gov.au describes personal information as any information that could be used to identify a person, with examples including a customer's name, address, email or phone number, date of birth and bank details.
The OAIC says most small businesses are not covered by the Privacy Act 1988, but some are. For this purpose a small business is one with an annual turnover of $3 million or less. Regardless of turnover, the Act covers a business that is a health service provider, that trades in personal information, or that is a contractor providing services under a Commonwealth contract, among other categories the OAIC lists.
If the Act covers you, two of the 13 Australian Privacy Principles are worth knowing before a move. APP 11 requires reasonable steps to protect the personal information you hold from misuse, interference and loss, and from unauthorised access, modification or disclosure. APP 8 covers the steps to take to protect personal information before it is disclosed overseas, so ask any provider where your customers' data will be stored and who can reach it.
If the Act does not cover you, the OAIC still recommends protecting any personal information you hold. In practice that means moving only the records you need, deleting old exports once the move is finished, and limiting who can open the new system. This is general information, not legal advice: if you are unsure whether the Act applies to you, ask the OAIC or a lawyer.
Who owns what you commission
With a subscription you are paying to use someone else's product on their terms. Read those terms for what happens to your records when you leave.
With custom work, do not assume. IP Australia says that in Australia IP created by a contractor is the property of the contractor unless otherwise stated in the contract, and it gives websites, designs and databases as examples of what contractors are hired to create. Its advice is a written contract, signed before work starts, that defines who owns the IP, who has the right to use it commercially, and if and when ownership will transfer.
Software is covered too. The Attorney-General's Department lists computer programs and software code among the literary works copyright protects. It also says copyright protection is automatic in Australia, with no formal registration system, and that copyright can be assigned, licensed or sold like other personal property. Ownership of commissioned code is something a contract can settle, and should.
Comingwave is a technology company that builds custom software and connects the business systems that small and medium enterprises already use. Its quotes are agreed in writing before work starts, and clients keep ownership of their code, data and documentation. Whoever you hire, ask for the same clarity. More answers are on the Comingwave questions page.
Common mistakes
- Buying on the feature list, not a trial. A product can tick every box and still not suit the way your staff work.
- Comparing a subscription's first bill with a build's total. Compare both over the life of the tool.
- Ignoring the exit. If you cannot export your records in a usable format, you do not control them.
- Moving every old record across. Data you no longer need is risk with no benefit.
- Starting custom work without a contract. Without written terms, the default position on IP may not be the one you expected.
Frequently asked questions
Can a small business start with a subscription and build later?
Yes, and it is often the sensible order. Using a product first teaches you which features you rely on and where it gets in your way. That list becomes the scope if you later ask a developer about a custom system.
Does the Privacy Act apply to my small business?
The OAIC says most small businesses, meaning those with an annual turnover of $3 million or less, are not covered, but some are whatever their turnover. Examples include a business that is a health service provider or that trades in personal information. Check the OAIC's small business guidance against your own situation, and get advice if you are unsure.
What is a CRM, and should I build or buy one?
business.gov.au describes a customer relationship management system as one that records contacts between you and your customers and gives a single view of a customer's history, needs and preferences. Plenty of products do this, so trial those first. Building makes sense when your sales or service process does not fit any of them.
What should I ask a software provider about my data?
Ask where the data is stored, who at the provider can access it, how it is backed up, how you export it and what happens to it when you cancel. Get the answers in writing. For a custom build, the About page sets out how a Comingwave project runs, from the discovery call to ongoing support.
Key takeaways
- Buy when the job is common and a product fits without workarounds.
- Build small when your process is unusual, or when separate tools force staff to retype the same details.
- Compare the total cost of ownership of both options, not the first bill.
- Look after customer information wherever it is stored, and move only what you need.
- Put ownership of custom code in a written contract before work starts.