Build vs Buy Calculator
Compare the real multi-year cost of a SaaS subscription against a custom build, and find your break-even point.
Your numbers
SaaS / year
$15,000
Maintenance / year
$11,250
Cumulative cost over 5 years
SaaS costs $56,250 less over 5 years.
Break-even in about 20.0 years (month 240), before counting integration fees, workaround labor, or switching costs on the SaaS side.
What the spreadsheet can't show
TCO math settles the cash question. These three factors often matter more than the dollar difference.
Data ownership
Custom development gives you complete control over your data: how it's stored, who accesses it, how it's backed up, and where it's hosted. SaaS platforms hold your data under their terms. For businesses with compliance obligations or sensitive customer records, that control alone can justify the build regardless of cost.
Fit gap
Generic platforms force your processes to adapt to their workflows. The daily workarounds (manual exports, duplicated entry, steps the platform should automate) are real costs that never appear on an invoice. If two people lose five hours a week to workarounds, that's over $39K a year in labor at typical loaded rates.
Vendor lock-in
Subscription prices never decrease and frequently increase. Switching later means data migration, re-integration, workflow redesign, and retraining: often $50K–$100K depending on complexity. That creates practical lock-in even when the contract says you can cancel anytime.
At 25 seats, every additional hire adds $600 per year in license fees, forever. Custom software has no per-seat meter: hosting and maintenance grow slowly with usage, so your unit economics improve as you scale instead of degrading.
How this calculator works
The math is deliberately simple and conservative. The SaaS path totals your per-seat license cost across every seat for every month of the horizon. Seat cost × seats × 12 × years. The custom path stacks your one-time build estimate with annual maintenance expressed as a percentage of that build cost, charged from year one. Break-even is the month where the two cumulative curves cross: build cost divided by the annual gap between subscription spend and maintenance spend.
Five years is the default horizon because that's the window where the build-versus-buy decision actually resolves. Subscriptions look cheap in year one, there's no upfront cost at all. But license fees never amortize and never decrease, while a build cost is paid once. Most custom web portals we price in the $75K range cross break-even against a $2,000/month platform somewhere in years two to four.
The costs this tool doesn't count
This calculator compares only the obvious invoices, which means it understates the true SaaS total. Off-the-shelf platforms typically add integration work to connect your existing systems, configuration and professional-services fees to match your workflows, and the quiet labor cost of workarounds when the platform can't do what you need. Two people spending five hours a week fighting a tool's limitations is over $39,000 a year in fully loaded labor, more than many maintenance budgets.
There's also the exit cost. Migrating off a platform later. data export, re-integration, retraining, routinely runs $50K–$100K, which is why "we can always cancel" is less true than it sounds. If the comparison above is anywhere near parity on cash alone, these hidden costs usually tip it decisively.
When buying genuinely wins
Custom isn't always the answer. If a standard platform serves your needs with minimal customization, if time to deployment matters more than perfect fit, or if you genuinely can't maintain custom software long-term, buy the subscription and spend your capital elsewhere. The honest use of this tool is not to make custom win every time, it's to force the comparison onto total cost of ownership instead of sticker price, so whichever way the decision goes, it goes with open eyes.
Go deeper
5-Year ROI Calculator Worksheet
The free PDF version, print it, share it with your team, or hand it to a vendor. No email gate.
Custom Portal ROI: Build vs Buy
The full framework behind this calculator, TCO analysis, hidden costs, and how to build the business case.
Custom Portal vs Off-the-Shelf
A feature-by-feature comparison of custom web portals against packaged software for growing businesses.
Build vs buy questions, answered
Want a real number for the custom column?
Schedule a free consultation and we'll scope your project with transparent pricing. So you can run this comparison with actual figures, not guesses.
Schedule a free consultation
