For a business that has decided to jump onto the e-Commerce bandwagon, make the right choice of technology - SaaS, Open Source or Custom
Every business - small, medium, or large is now deliberating on e-Commerce, which Wikipedia says:
is the activity of electronically buying or selling products on online services or over the Internet.
For a business that has decided to jump onto the e-Commerce bandwagon, the typical choice boils down to one of
- SaaS (Software as a Service) - A software platform that is made available to you as a service, you sign-up and is ready to go in a few minutes.
- Open Source Software - In many cases, free as well, with a large ecosystem of "plugins", that could support any functionality or feature that you would ever want.
- Custom Software - A platform that is built and/or customised based on detailed understanding of specific business needs.
This is a choice that businesses often struggle to make. Which one is right for you?
SaaS works best when your objective is to add e-Commerce to your existing business; when e-Commerce is still not a real focus yet and you are looking for an "online presence".
SaaS is also a great option when you are starting off a "small" e-Commerce business, typically in a niche area.
Typical SaaS platforms are built for scale (handle large number of users) and are available at an all inclusive monthly price (software, support & hosting). Few SaaS platforms also charge transaction fees (between 1-2%) over and above payment gateway charges (which is typically between 1-3%).
However, the choice becomes little tricky when you have larger aspirations for your e-Commerce business. The SaaS pricing becomes prohibitive, functionality missing and platform lacking flexibility for customisations.
Open Source Software entice as a great alternative - the software is typically free, comes with an extensive set of functionalities and is fully customisable; until one realises the practicalities involved.
Getting the Open Source Software running for you (implementation) would require help from a software solution provider. As many of these softwares come with simple setup instructions (and even one-click installs), software companies across the globe offers "e-commerce solutions" at super cheap pricing.
A large number these companies come with little to no understanding of the underlying technicalities. Some of them also offer "free support". If you happen to be with one of them, you end up with an implementation that is slow, that has a poor user experience, burgeoning infrastructure costs (their typical solution to improve performance is to double the resources), no software updates or support (due to the free support).
A good software solution provider, with a strong understanding of the underlying Open Source Software can go a long way in alleviating some these problems. They don't come cheap and do not offer "free support".
However, some of the "popular" Open Source Softwares have become popular over the many years; and continue to use outdated technologies, preventing you from getting the best out the rapid evolving technology ecosystem.
Thus, the need for Custom Software Development. While this happens to be the most expensive option, it also provides you with the greatest return on investment. By carefully selecting a vendor, with a strong and experienced technology team, you can own a modern, contemporary e-Commerce platform built on modern tech, with focus on speed, performance, customised user experience, platform stability and greater control on infrastructure costs. This also allows for deep customisations, based on your business growth and changes in business model.
In most cases, you also get to own the intellectual property rights for the software, which is a crucial component of your business valuation.
As you make your choice for e-Commerce platform, do make an informed choice.