“There are dozens of these behind-the-scenes factors that make things appear easy to build, but in actuality, very difficult to successfully maintain. Having someone else experienced worry about these intricacies can serve as a major competitive advantage when integrating.”
From data compliance to multi-tenancy, a dedicated development team equipped with the latest market insights will be better able to handle ongoing maintenance for enterprise-level ecommerce software.
What to Consider Before Building or Buying
Now that we’ve discussed the factors that should drive your decision, let’s dig deeper into what to consider before building or buying an ecommerce operations platform to suit your needs, including:
- Readiness
- Use cases
- Project scope
- Resources
- Opportunity cost
- Building risks
Readiness: Is your business in a position to weather disruption?
You can’t walk into work one day and drop a development project on an unsuspecting team. Any change within a company brings some level of disruption, which should be accounted for when choosing whether to create or purchase a solution.
Despite best practices, many development and marketing teams operate in silos. Each team focuses on its own processes, datasets, and ways of working. Introducing a new software integration (whether bought or built) without preparing the organizational side of your business is a clear recipe for disaster.
Yes, technology upgrades and replacements are crucial for the success of both your business and your customer, but your teams and processes must be in a position to embrace change. That said, you must evaluate the organizational processes that will become necessary when introducing new software.
Use Cases: Do you have a proper understanding of the use cases of the end result?
In the early stages of decision-making, it’s critical to answer the question of what use cases you intend for your new software to solve. The use case behind the platform or ecommerce middleware influences who the stakeholders will be. Who will use this solution regularly in their day-to-day lives?
For example, when building an integration for accounting data collection, analytics, and reporting, the stakeholders are typically CEOs, CFOs, and other executives who need to acquire profitability insights to gauge the organization’s success.
A proper understanding of the use case(s) that the new platform or integration you’re building or buying must deliver wildly influences the requirements for the end result.
Project Scope: Is the issue you’re attempting to solve common in your industry or unique to your company?
Next, you must weigh whether the issues you’re attempting to address are unique to your company or common in the ecommerce industry.
Many ecommerce business owners and tech leads today face similar challenges, most of which are already solved in enterprise ecommerce solutions. However, if your needs fall within edge cases beyond the functionality of platforms on the current market, you may have a good argument for custom development.
Complexity plays a role here, too. Trusted internal development teams can often handle a high level of complexity. However, if your integration must comply with data regulations, such as GDPR or CCPA, and span multiple geographical locations, it’s probably wiser to buy an enterprise ecommerce platform instead to save on resources and time.
A commercial solution that reduces the risk of any unintentional non-compliance will pay for itself when you compare the hefty fines you may receive if your in-house solution fails to follow regulations.
Resources Do you have enough people, time, and other resources to see the development project through?
When building internal ecommerce middleware software, you should first consider whether your company has enough resources to get it done–even if you go over budget.
Most of today’s popular platforms have been in the making for several years. Creating an enterprise ecommerce solution requires an incredible number of people, including data engineers, developers, data scientists, UI/UX designers, and more. And once complete, these platforms need to be evolved to keep up with an industry in which a new standard can pop up any given day.
Before deciding to build in-house, you must also take the potential impact of pulling resources away from critical company operations into account. It’s usually wise to leverage third-party automation job infrastructure and event-driven APIs to scale your operations without reinventing the wheel. This allows you to integrate once and avoid maintaining multiple scripts, integrations, and disparate jobs.
Opportunity Cost: Will building an in-house solution distract your employees from solving more critical business problems?
In a perfect world, IT teams will focus on gathering data and building the technical infrastructure to collect, report, and predict critical business insights. Your IT team should exist as your company’s “big brain” that can offload insights to teams specifically designed to communicate and orchestrate tasks.
When tasks are beyond your IT staff’s comfort zone, it’s best to hand them off so that they can focus on what they do best. This may mean handing them off to a third-party solution that can amplify your team’s efforts.
Time-to-value: Can your in-house development team build a platform within a reasonable time frame? Are your issues time-sensitive?
Having a shorter time-to-value will help you keep customers engaged and position your company ahead of the competition.
Requirements fluctuate over time, and it’s easy to spend years developing software only to fall short of the requirements to use it. It’s possible that, as the market changes, your internal teams won’t be able to shift gears fast enough (or not at all), which significantly impacts your ROI.
So, ask yourself, can your team develop a solution in a reasonable time frame? If they can, is it possible to ensure the final product accurately addresses the businesses issues you’re attempting to solve?
Finally, if the use cases are time-sensitive, how long can your company afford to wait for a solution? If time is of the essence, purchasing middleware will serve immediate needs, while building an internal solution can take years—and you risk not entirely solving your issues.
Building Risks
If you’ve decided to build a custom software solution, you should know that you’re playing with metaphorical fire. Let’s discuss a few of the risks of building so you can make a more informed decision.
Will additional resources be available beyond the projected development timeline?
In software development, speed matters. One day can mean big profits or setbacks in a highly competitive environment like ecommerce. Timing can be affected by a variety of reasons, such as:
- Lack of resources
- The functional features of the final product were not determined in a timely manner
- The total time for the project was incorrectly determined
- The project manager doesn’t properly track task status
- An unexpected expansion of the project scope, etc.
To avoid this specific development risk, you must ensure the maximum involvement of all team members involved in planning and executing the project. It’s essential to gather and analyze feedback from all project stakeholders at all stages. If your development speed suffers, you may have to consider an emergency team expansion, which can significantly increase the project budget.
Poor productivity is also among the top software development risks. This is most common for teams working on projects with long timelines (i.e., software development services).
A long project can mean team members waste time in the early stages, believing in the illusion that there is plenty of time. Often, poor productivity stems from incorrectly chosen project methodology, poorly matched team members, and poor project management.
What about unpredictable external factors?
When running a development project, unpredictability is another enemy. External risks in software development are inevitable due to:
- Unforeseen market changes
- The sudden growth of a competitor (often with more resources available)
- Changes in consumer behavior and priorities
- Implementation of new government regulations
Can your development team afford to take on technical debt?
When a quick fix is necessary due to a less-than-ideal timeline and budget, your team may choose to take on technical debt. Technical debt is the future obligation to fix inherently flawed software. Sometimes, a team is forced to take on technical debt due to poor planning.
On top of technical debt, your team may lack the talent and finances to see the project through to completion. These two factors together lead to lost company time and money.
Can you build and maintain a secure ecosystem?
Strong security practices are essential, especially in the realm of data collection. If you’re considering building software in-house, you must consider data security and compliance.
Data security isn’t a small concern—it’s a 365 days a year, no days off, forever type of effort.
The average cost of data breaches is highest in the United States at over $8 million per year. With the introduction of legislation such as GDPR, CCPA, and APP, lawsuits, settlements, and fines related to data security are also on the rise.
Ecommerce makes up a significantly increasing portion of total retail activity. As the industry grows, so do cybersecurity threats and data breaches, which lead to many business owners struggling to keep their company’s reputations in check.
Large-scale ecommerce retailers are frequently targeted by cybercriminals hoping to steal customers’ personal and financial data to steal identities or make unauthorized transactions.
Unless you can guarantee security, the risk of developing an unprotected, insecure solution likely isn’t worth it. You’re backed by certifications and industry standards when you choose trusted third-party software. You will have the peace of mind that exists alongside a reliable software solution.
In addition to 16+ years of SaaS experience, Flxpoint has network firewalls, full disk encryption, code vulnerability scanning, traffic monitoring, and more in place to make it more dependable than an in-house solution.
Buying Risks
A trial is often ideal for a smaller business but becomes more challenging to implement at the enterprise level. New software often comes with a lengthy onboarding process, which is necessary to ensure success with new technology. Before deciding to demo or sign up for a trial of any software solution, familiarize yourself with the risks of buying versus building a solution yourself.
Can you trust a third party?
One of the most enticing reasons to purchase ecommerce middleware instead of building in-house integrations is to benefit from knowing you’re working with a trusted software vendor
Enterprise-level companies can be victims of malicious cyber attacks, which lead to compromised client accounts. In fact, there’s a pretty good chance that your data has been inadvertently exposed in a vulnerable system at some point.
There are several practices that can improve data security, including evaluating security processes, data loss prevention, data encryption, and implementing governance, risk, and compliance methodologies.
You can further reduce your company’s cybersecurity risk by putting strong authentication methods in place, such as OAuth for web-based systems. However, breaches do occur even when a company follows cybersecurity best practices. It’s worth extra consideration before willingly allowing your company to become a potential target of large-scale cyber attacks.
Does the existing software address all of your needs?
Another risk of opting to work with a vendor is whether their existing solution satisfies your company’s needs. Let’s assume that many ecommerce retailers face the same issues, so the software market is saturated with software options. It is still possible that no one third-party software addresses your specific use case.
Many software companies are open to customer feedback and encourage suggestions when developing their roadmaps. However, if your problem is unique or limited to your niche, it’s unlikely that a company will develop a solution specifically for you.
Do you have confidence in the vendor’s ability to weather a market downturn?
Let’s say you purchase an ecommerce operations app and integrate it within your business processes. A year later, the company raises its pricing to avoid going out of business. Months after that, they end up bankrupt anyway.
Now, you’re facing the same dilemma and kicking yourself for not considering the risks of buying software last time. When working with third-party solutions providers, you must be confident in their ability to weather the external factors that may affect the health of their business.
Reasons to Build Software
In most situations, it’s a better decision to buy rather than build middleware. However, there are reasons to develop a 100% custom solution. Some factors that may influence your decision include:
Full Control Over Data and Security
When you build a solution in-house, you are strictly accountable for what happens to your and your customer’s data. You don’t have to wonder whether a third-party vendor follows all data requirements if you’re relying on your internal team to secure your solution.
Build to Your Exact Specifications
Generally, off-the-shelf products are built to satisfy the needs of “most customers,” but sometimes certain features that are important to you may be lacking. If you can’t select or modify features to suit your specific requirements, developing your own solution may be less frustrating.
Your Code = Your Property
The code that you and your team create is your property. You may choose to build a solution if there is an opportunity for commercial development down the road.