According to a recent Internet Retailer article, over 60% of mid-market retailers opted to purchase an inventory management solution as opposed to building one in-house. I speak with people in the remaining 38% every day - business owners who are drawn to the control and flexibility they believe will come from building their own solution for tasks like managing product descriptions and prices, processing orders, and handling payments.
While there may be certain instances where building is worth considering, the vast majority of business owners I talk to - each with their own use cases, unique workflows, and wide range of products - should choose to buy. The question from there is which solution to purchase, but let’s first address the foundational issue of buying versus building inventory management software and why the former is the best choice for most mid-market retailers.
When your company considers building a comprehensive solution from scratch, it’s important to factor in all costs - even those you might unexpectedly incur. Hiring engineers (or taking current engineers off other projects to focus on this colossal effort) is expensive, but there’s more to the equation. Often these projects take far longer than expected to complete, which results in the added opportunity loss of being unable to actually use the software until much later than initially anticipated. As a result, the project might even be outdated by the time it launches. Additionally, you’ll want to test and optimize, which takes time and money and is something built into the cost of an off-the-shelf solution.
A hired contractor is accountable for the scope of your project as outlined in the signed contract. For example, Stitch Labs, as a software-as-a-service (SaaS) solution, is accountable to you month after month, year after year. Once a contract is up, that person is no longer held accountable to your system. If it breaks, needs new features, or can’t support your business as you scale, you’re looking at a new contract. I’ve talked to many business owners who decided to build, only to add technologies and complexities to their operations that their current system can no longer handle. We listen to customers and iterate based on their needs - adding meaningful features that will help you scale and will cost you far less than a custom build.
A lot of business owners I talk to like the idea of hiring someone whom they can tell exactly what they need made and how they want the system to run. If the process actually looked like this, a lot more businesses would choose building over buying. First, consider the amount of time it would take to train someone in your current systems, and then accurately convey your vision and message to your new hire. You need to constantly check in, as it becomes increasingly difficult to make changes as a project like this progresses. Additionally, unlike when you contract a licensed professional to build a building, you’re more or less taking a leap of faith with a computer engineer. You can speak with references and look at portfolios, but odds are this person has never built an inventory management system from scratch before (and let’s not forget Red Adair saying, “If you think it’s expensive to hire a professional to do the job, wait until you hire an amateur.”) If someone leaves the role or an additional contract is needed at a later date, don’t underestimate the time and money you’ll need to invest in training someone new on your current system.
When you purchase software, you don’t need technical resources on your end to ensure it will always work and always be evolving and responding rapidly to market changes. Stitch’s inventory management solution is designed to support growth. We have a whole team of engineers creating new functionalities every day - as well as a product team that is constantly looking to customer feedback to guide our product roadmap. Our team utilizes our diverse customer base - all with their own unique systems and problems - to stay in touch with what’s slowing you down and figure out how we can make your life easier while helping your business thrive.
Stitch invested heavily in our API strategy so our platform can accommodate unique customer needs. We have trusted contractors familiar with how our API works, who can swiftly build our customers custom workflows. This provides you with the one major benefit of building, while also giving you all the benefits of a tried and trusted system.
When it comes to building or buying an inventory management software, choose the option that best supports business growth. Already-built products have teams constantly iterating on processes and evolving their platforms - all while you focus on running a great business.
Learn more about Stitch’s inventory management solution from one of our product consultants.