Standard Software vs. Custom Software

A question that often arises: should software be developed in-house or purchased off-the-shelf? In this article, we’ll explore both custom and standard software, their respective advantages and disadvantages, and explain when to use each.


What is Standard Software?

In the case of standard software, you purchase a license, install the software, and the user can get started after a minimal configuration process. Standard software is “off-the-shelf,” much like the T-shirt you buy at a department store in a fixed size.

Standard software is not tailored to the specific needs of a particular company and its users, in contrast to custom software, which is developed individually for a specific purpose.

The examples of standard software include familiar programs like operating systems and office suites, such as Microsoft Office. Even complex enterprise systems like SAP R3, though customized extensively, are still categorized as standard software.

Advantages and Disadvantages of Standard Software

The purchase and use of standard software come with several advantages.

The Advantages of Standard Software

Quick deployment: Since the software has already been developed, it can typically be implemented faster than custom software. This can be advantageous in time-sensitive situations.

Cost-efficient: Standard software is generally more cost-effective than custom software. Depending on the licensing model, high user numbers and time factors can reduce this advantage significantly.

Reliability: If standard software is developed by a reputable developer with a large development team, you can generally expect the software to be of high quality. This, in turn, reduces your own support and maintenance efforts at the first level.

Regular updates: A good developer provides regular updates. If problems are identified, they also quickly provide patches to address these. This is particularly relevant from a security perspective.

standard software vs custom software

The Disadvantages of Standard Software

Limited customization: Standard software may not meet all of a company’s specific requirements. Even if customization is possible, it may not be free.

Unnecessary features: Since the developer aims to cover as much as possible, standard software often includes features that are not relevant to you and your users, complicating the management and operation of the software.

Dependency on the developer: Long-term use of standard software means being dependent on the decisions of the respective developer, especially regarding the implementation of future features, patches, and support.

Security risks: Since standard software is usually widespread, it can become a target for cyberattacks because any security vulnerabilities (0-days) are more well-known.

Ongoing licensing costs: While standard software is cost-effective in the initial acquisition compared to custom software, it often requires regular payment of license fees, resulting in higher ongoing costs.

Limited innovation opportunities: Users of standard software rely on the pace of innovation and features provided by the software developer, making adapting to new technologies more challenging.

What is Custom Software?

Custom software, also known as tailored or client-specific software, is a type of software specifically developed to meet the individual requirements and needs of your business. Unlike standard software, which is developed for general purposes and used by many users, custom software is developed according to your exact specifications and requirements. Returning to the clothing analogy from earlier, custom software is like a tailor-made suit.

Advantages and Disadvantages of Custom Software

Custom software increases the likelihood of getting a tailored solution for your company’s specific needs. This leads to long-term cost savings through increased process efficiency and reduction of redundant operations. The adaptability of custom software enables additional changes to the software functionality after initial development. This ensures increased security and data protection as there are no security holes due to outdated software code. Simple modifications increase the adaptability of the software and the efficiency of the organization. In addition, direct contact with the manufacturers enables possible problems to be solved.

On the other hand, there are also some disadvantages of custom software. Custom software can be expensive and time-consuming because it is tailored to specific needs. It often offers less flexibility and requires regular maintenance and support, while standard software can provide regular updates and a more stable foundation. There is also the risk of failure and dependence on developers, which can lead to potential problems for companies.

Comparing Standard Software and Custom Software

Our table below gives you a clear overview of the differences between standard and custom software:

Standard SoftwareCustom Software
DevelopmentDeveloped for a broad user base.Specifically developed for your particular organization.
Time to implementation, change managementVery fast, if no customization is needed. Often it requires the adaptation of internal processes.Development time depends on your requirements but there is no need to adjust any internal processes.
CostOne-time or monthly costs, depending on the licensing model.Development costs depend on requirements, with lower ongoing maintenance and support costs.
Development riskLow risk, as it has already been developed.Higher risk due to tailored development.
AdaptabilityLimited customization options, as it is developed for general purposes.High adaptability to meet specific requirements.
Feature setContains predefined features that may not meet all requirements.Can include any desired feature and requirement.
SecurityDepends on the security measures of the software provider.Can be tailored to your specific security requirements.
ScalabilityUsually easy to scale.Scalability can be more complex and may require additional adjustments.
Updates and influencing theseDependent on the developer; limited control.Development of updates occurs in-house, allowing for greater control.
Training requirementsOften extensive training is required, as internal processes need adjustment.Lower training requirements, as the software is tailored to user needs and processes.
Copyright and Usage RightsLimited usage rights.You own the software.
Standard software vs individual software – a detailed comparison

Standard software and custom software each have their respective pros and cons. Standard software, developed for general purposes, is cost-effective, quickly implementable, and regularly updated, but it has limited customization options.

On the other hand, custom software provides a tailored solution, meets specific requirements, and can offer a competitive advantage, but it is more expensive, requires more development time, and demands comprehensive maintenance.

When to Use Each Type of Software

The choice between standard software and custom software depends on individual requirements, your available budget, the timeframes, and your business goals. In many cases, a combination of both types of software can be the best solution, allowing you to leverage the advantages of standard software while satisfying specific functions andl requirements with custom software.

It is important to carefully weigh the pros and cons of each type and to make an informed decision. To assist in this process, here are some guidelines for when to use each type of software.

When Should You Use Standard Software?

Using standard software is advisable when:

Handling general tasks: If your requirements largely align with common business processes in your industry, then using standard software is usually more cost-effective and faster to implement.

Budget constraints: Standard software is often more affordable, making it advantageous for small businesses or individuals.

Time constraints: If you need a quick solution, then standard software can be ready for use at short notice, whereas custom software development takes time.

Meeting general requirements: If your needs closely match the features and capabilities of standard software, then it becomes a suitable choice.

custom vs standard software

When Should You Use Custom Software?

You should consider custom software when:

Specific requirements: If your requirements are unique and standard software cannot meet all of your needs, then this makes it a compelling reason to opt for custom software. The reason for this uniqueness can stem from your business’ specific processes or your existing IT landscape.

Competitive advantage: If you aim to gain a competitive edge by offering unique features or services, then custom software is the way to go! Consider your customers’ needs in this context.

Efficiency improvement: Choose custom software you want to optimize and automate your business processes for increased efficiency.

Special integration: If your software needs to integrate with existing IT systems, and standard software doesn’t adequately support this.

Security requirements: If you have specific security needs that call for custom security solutions.

Long-term investment: If you’re planning for the long term and require software that can continuously adapt to changing needs. With custom software, you have direct control over its ongoing development.

Larger budgets and resources: If you have the financial means and technical expertise for custom software development and maintenance.

Individually, these questions are best answered after conducting a requirements analysis, followed by an evaluation of the standard software currently available on the market. The results of the requirements analysis determine the specific characteristics the new software must possess. Subsequently, you should examine existing solutions to determine if they can meet these requirements.


In summary, the choice between standard software and custom software depends on various factors. Standard software offers a cost-effective and quick solution for general tasks that many businesses can use. It is ideal for organizations with limited resources and time constraints. On the other hand, custom software provides a tailored solution that meets specific requirements, offers a competitive advantage, and enhances efficiency. However, it requires more time and resources for its development and maintenance.

The decision about which type of software to use should be made carefully. In many cases, a combination of both approaches may be the optimal solution, allowing you to leverage the advantages of standard software while incorporating custom features. A thorough requirements analysis and an examination of the available standard software solutions are essential to make the right choice.

How Can We help you with Custom Software Development?

what if you don’t have an experienced development team or sufficient technical resources? is here to help you find the right customized software solution for you. With more than 27 years of experience in implementing efficient solutions, we have delivered customized software solutions for various industries and large and small companies. Do not hesitate to contact us.

Programming Architect at 72® Services
Simon Martinelli ist ein versierter Experte für Java, Leistungsoptimierung, Anwendungsintegration, Softwarearchitektur und Systemdesign mit 27 Jahren Erfahrung als Entwickler, Architekt und technischer Projektmanager. Kontaktieren Sie mich hier oder buchen Sie einen Beratungstermin über Calendly.
Simon Martinelli
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Simon Martinelli
Programming Architect 72® Services
Simon Martinelli is an accomplished expert in Java, performance optimization, application integration, software architecture and system design with 27 years of experience as a developer, architect and technical project manager. Contact me here or book a consulting appointment via Calendly.