Revenue Management software: Build or buy?
Your business needs a revenue management solution. This might be a trade promotion management & optimisation tool, or a pricing management tool. But should you invest in the software from a provider, or build the model in-house? This is a dilemma many teams within consumer goods businesses face, and unfortunately there is no straightforward answer - the truth is, it depends greatly from business to business.
Here, we outline the pros and cons of working with a specialist software provider and building your own revenue management solution, focusing on the different aspects that need to be considered before making a decision.
When it comes to building your own revenue management solution, you have complete autonomy of the roadmap. You own the product code completely and your team shape the solution entirely. This means that the product is tailored to your organisation’s needs, current ways of working, and evolves alongside your business. This is a considerable benefit of building your own solution.
In contrast, SaaS providers must meet the demands of multiple clients, and the solution must be broad enough to offer the requirements to many businesses of a variety of maturities. This may seem like a negative, but these providers have made a solution designed to successfully accommodate the needs of the majority – you just need to ask yourself if your business fits into this bracket.
Building your own solution comes with a large upfront cost. In order to get a tool up and running, you’ll need to invest heavily in development resource, and even more so if you’re looking at a specific software development partner.
A SaaS solution will have a much lower upfront cost, but you will have to budget for an ongoing licensing fee. Bear in mind though that the vendor will be constantly updating and investing in their solution to save your business the hassle later down the line. Your subscription will provide you with a dedicated support team, and a chance to give your say in roadmap priorities.
Speed & usability
When it comes to speed of deployment, there’s no contest, SaaS companies spend a lot of their time and effort making their tools as fast as possible for end users. Implementation will be faster too, as most providers can get a tool up and running in as little as 3 weeks. In contrast, an in-house solution will mean at least 6 months of development and preparation from the word go – something to consider if you need to get going with your revenue management strategy straight away.
Usability follows a similar trend, as SaaS providers hire user interface & user experience (UI/UX) experts to ensure the tool is user-friendly and easy to use.
Most trade promotion management software providers will include the most common integrations as standard, such as for enterprise resource planning (ERP) & customer relationship management (CRM) tools. Something to consider when building your own solution is that you will have to develop each of the integrations you require.
Building a revenue management platform involves commitment, and once in place, you’re responsible for making sure it grows and evolves with the needs of your business. Maintenance also involves fixing bugs, resolving server issues and deploying critical updates and new functionalities. These might seem quick fixes with a contracted development team, but is even easier when it’s not your problem. SaaS providers work to constantly update their solutions with crucial updates, continuously investing in their software so you can focus on interpreting the data, rather than managing the system itself.
The infographics below illustrate the advantages and disadvantages of building or buying software:
Talk to our team about your revenue management priorities
We’re happy to chat about where you are in your revenue management journey currently. If you’d like a schedule a demo with our team, contact us here and we’ll be in touch.