A guide to custom software development

11 min read
December 20, 2022

When you hear the word bespoke, what comes to mind?

Most likely, a perfect-fitting but expensive suit or pair of pants.

Well, the software equivalent is roughly the same.

Bespoke or custom software is tailored to your business’s needs. And it could also be expensive.

But unlike a bespoke suit, custom software isn’t just a luxury. For many organizations, it’s crucial for gaining competitive advantage and it’s their key to success.

In this article, we’ll walk you through custom software development and explain when you might need it.

What is custom software development?

Custom software development is the process of designing, developing, launching, and maintaining software that’s made specifically for a company. It’s also called proprietary software.

This is in contrast to off-the-shelf software, which are apps available commercially to the public.

Chances are that most programs you use—including your computer’s operating system—are all off-the-shelf.

Creating custom software requires the following process.

Custom software development process infographic

Source: Scalefocus

It starts with the analysis phase. This is arguably the most crucial step because this is where you define what the software should do, based on your requirements.

If you get it wrong here, the software will ultimately fail.

Next is the design phase, where the team plans out the architecture of the software. For apps, this involves drawing wireframes to visualize the UI of the end product.

The third is the coding phase. Here, the development team starts coding the software based on the blueprints laid out during the analysis and design phase.

The fourth phase entails testing. The software is evaluated to determine if it meets your requirements.

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Bugs and usability issues are also weeded out during this phase to ensure stability.

Next is the implementation phase. Unlike commercial software typically launched to the public, custom software is deployed on your own system.

Some teams refer to this process as putting the software into production.

Finally, there is the maintenance phase. This is a continuous part of the development cycle where the team regularly updates the software to fix bugs or improve features.

Why should you choose custom software development?

So with the wide selection and low cost of various commercially available options, why would a company still go for a custom solution? It turns out there are plenty of valid reasons.

Having a solution tailored to your needs

The biggest reason to opt for custom software is if no off-the-shelf solution can entirely satisfy your business’s needs.

A good example of this is our custom bug reporting tool, Shake.

Shake screenshot

Source: DECODE

We noticed that many developers were wasting a lot of their time looking for bugs and crashes. Unfortunately, there was no commercial tool available that would help in this case.

To get around this, we developed a bug-reporting SDK that gave users a quick way to report bugs without leaving the app.

Reported bugs go to the Shake dashboard, where the development team can easily review and tackle them.

Custom software like Shake adapts to the business’s workflow, and not the other way around. That means you can focus on becoming more productive and efficient.

Seamless integration with existing software

Custom software is the way to go if you want all your business tools to work seamlessly.

The thing is, companies rarely only use just one software solution. Surveys have shown that the average is around 254 different apps.

Unfortunately, many of these off-the-shelf solutions have limited integration options. In fact, you’re not even allowed to modify the software to integrate it into your workflow.

That means you must manually switch and move data from one app to another.

As you can imagine, that’s a time-consuming and error-prone process.

But with custom software, you can integrate it into any software you choose in any way you wish.

This automates aspects of your operation, which will dramatically improve your productivity.

For example, a custom enterprise resource planning (ERP) platform allows you to connect the software systems of various departments and business functions.

This enables things like centralized administration, which can help make your operations more efficient.

ERP includes

Source: Altamira

As your business grows, you’ll realize that integration is the best way to make everything run smoothly. And the only way to achieve that is through custom software.

Full ownership of the custom solution

One perk of a custom software solution is that you own it outright.

See, when you buy commercial software, you don’t actually own it. Rather, you’re just renting it. You can’t modify or sell the app, as covered in the End User License Agreement (EULA).

EULA dialog

Source: Adobe

But when you commission a custom software solution, you own it. You can do anything you want to it—even sell it if you wish (which is what we do with our bug reporting tool, Shake).

This is especially important if you’re using SaaS platforms. That’s because you’re at the mercy of the company running these tools—if it goes down, it will interrupt your operations.

In contrast, you have full control over your custom software, which means you can access it anytime.

Long-term cost savings

It might be hard to believe, but a thousand-dollar custom software can be cheaper in the long run than a $10 per month SaaS service or a $60 commercial software.

Just take a look at this comparison chart. It shows that custom software becomes cheaper than a SaaS subscription at around the two-year mark for a SaaS with 50 users.

Evolution of costs comparing one of our custom solutions to an SaaS similar in features

Source: Further

Why is this?

Well, it’s because custom software only requires a one-time upfront fee plus a few dollars for maintenance.

Contrast that to a SaaS platform, which typically charges more per month as you increase the number of users.

In other words, custom software is an investment that gives better returns the longer you use it.

What factors affect the cost of custom software development?

One of the biggest drawbacks of custom software is that it’s generally more expensive than off-the-shelf options.

Furthermore, it is not easy to estimate the actual cost of a project. Indeed, estimates made during the early stages can be off by as much as 400%.

How to accurately estimate cost for building digital products

Source: Praxent

However, you’ll have a good chance if you understand the factors that drive custom software development costs.

The most significant one is the size and complexity of the project.

Software with innovative features, proprietary algorithms, multiple screens, and high-security risks is harder to develop—and therefore costs more.

More software features also lead to more complexity. For example, adding a login screen or chat functionality can make the software more complex.

To give you an idea, here are the ballpark costs for creating an app based on complexity:

Mobile app development cost infographic

Source: Droids on Roids

A custom UI will also affect the cost because it will require UX designers, graphic artists, and UI designers.

Incorporating visual elements like logos and animation also bumps the price even higher.

Do you want to integrate the software with third-party tools, systems, and APIs? Then it will be more expensive.

That’s because coding these integrations is added work for the developer, not to mention the price of any third-party libraries required.

Lastly, you should also consider the size and location of your team. Hiring a team from India will cost significantly less compared to getting one from Europe or North America.

Average hourly software development costs by location

Source: Diceus

Of course, this is just an overview of the costs involved. Other factors like the pricing model, data migration issues, and your niche can influence the price.

If you want to get a rough estimate, check out our app pricing calculator.

How to choose a custom software development company

One of the biggest factors in your custom software’s success is the team who will create it. Thus, it’s prudent that you pick the right talent for your project.

Here are some tips on how to do that.

Take a look at the company’s portfolio

When shortlisting a potential external development team, the first thing you should consider is their portfolio page.

A company’s past work gives you a glimpse of its skills and work ethics.

Case studies are especially helpful, as they can detail the challenges the team faced before and how they overcame them.

Decode screenshot short summary

Source: DECODE

It could also tell you if the company’s expertise is a match with what your project needs.

For example, let’s say you’re working on a fintech project. Even the best development team in the world could still struggle if they haven’t done any fintech software in the past.

However, there’s one thing to keep in mind—it’s easy to fabricate sample work. So it’s best if you can also verify past work with their former client.

Look into the company’s tech stack

The tech stack refers to the tools a development team is experienced in using.

This can include the programming language, third-party tools, database systems, and the hardware needed to build software.

Here’s an example of a tech stack:

tech stack

Source: Apxor

A tech stack is important to consider because different projects have varying technology requirements.

For instance, fintech apps often require cybersecurity protocols, Open Banking APIs, and secure programming languages like Java.

The tech stack is also important if you plan to develop a cross-platform app. That’s because the programming languages needed are different from a native app project.

The best way to check a company’s tech stack is to ask them. They’ll often share the appropriate technologies to use during your initial consultation.

Some companies also reveal the tech stack in their case studies.

Consider the company’s development methodology

One often overlooked factor when picking a software team is their development methodology.

This is surprising because the methodology can impact the success or failure of the project and therefore deserves more attention.

Now, it’s important to note that there’s no right or wrong methodology. Each has its strengths and weaknesses. What you’ll ultimately go for will depend on your situation and preferences.

For example, let’s look at two popular methodologies—Waterfall and Agile.

Waterfall vs. Agile

Source: Code Tiburon

In the Waterfall methodology, each development cycle is done in a series, requiring teams to complete a phase before moving to the next.

It’s very straightforward to implement, which makes it great for simple projects with unchanging requirements.

However, the Waterfall approach can be slow and resistant to change. And this is where the Agile methodology comes in.

In Agile, development is divided into mini-cycles called sprints. Each sprint goes through the usual cycles—from designing to testing—with a review phase at the end.

We recommend the Agile method for more complex projects because the iterative process reduces the overall risk. It’s also great if you want to be more involved during development.

Check the company’s online reviews

Nothing shows a company’s true capabilities (or flaws) better than reviews.

Good reviews are a sign that the company is reputable and skilled. Chances are, you’ll have a great experience with them.

On the other hand, many bad reviews could signal that the company must be avoided.

Most development agencies post client reviews and feedback on their website. However, those are most likely curated only to include positive ones.

If you want an unbiased view, head to third-party review sites like Clutch.

DECODE reviews

Source: Clutch

Clutch, in particular, has very detailed reviews that go through all aspects of the client’s experience.

That allows you to evaluate a team throughout the development process and not just with the end result.

Need a custom software solution?

If you’re looking for a reliable developer for your custom software solution, look no further than DECODE.

We’re a team of over 70+ professionals with a wide range of software development skills.

And we have successful projects to prove it, from mobile payment apps to Internet of Things software.

Clients love working with us, and we’re confident you will, too!

Interested? Contact us today, and let’s talk about your next project.

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Written by

Marko Strizic

Co-founder and CEO

Marko started DECODE with co-founders Peter and Mario, and a decade later, leads the company as CEO. His role is now almost entirely centred around business strategy, though his extensive background in software engineering makes sure he sees the future of the company from every angle. A graduate of the University of Zagreb’s Faculty of Electrical Engineering and Computing, he’s fascinated by the architecture of mobile apps and reactive programming, and a strong believer in life-long learning. Always ready for action. Or an impromptu skiing trip.

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