The verdict in three sentences
Off-the-shelf SaaS almost always wins over the first 3 years: spread cost, fast rollout, maintenance included. A custom build becomes profitable beyond the TCO tipping point (often 3 to 5 years) and when data control or strong scalability turn strategic. The SaaS trap is the price increase and the per-user cost that balloons as you grow.
Compared 5-year TCO
2026 order of magnitude, France, business need for 40 users.
| Item | Off-the-shelf SaaS | Custom build |
|---|---|---|
| Year 1 cost | 5,000-30,000 EUR/year | 40,000-120,000 EUR |
| Recurring cost | Annual subscription | 15-20% of build/year |
| Rollout | 2-6 weeks | 3-6 months |
| Data control | At the vendor | On your side |
| Functional scalability | Limited | Total |
| Price increase | 5-15%/year common | None |
| Cost per added user | Linear | Marginal |
At 20,000 EUR/year of SaaS you reach 100,000 EUR over 5 years — the price of a mid-range custom build, but without ownership or control over evolution.
The TCO tipping point
| Annual SaaS cost | Equivalent build | Tipping point |
|---|---|---|
| 8,000 EUR/year | 50,000 EUR | ~5.5 years |
| 15,000 EUR/year | 70,000 EUR | ~4 years |
| 25,000 EUR/year | 90,000 EUR | ~3 years |
| 40,000 EUR/year | 120,000 EUR | ~2.5 years |
Simple rule: divide the build cost by the annual SaaS cost to get the tipping year (excluding maintenance). Add maintenance to the build to refine.
Mini case study
Karim, CIO of a Marseille logistics mid-cap (60 users), decides on a planning tool. SaaS costs 320 EUR/user/year, i.e. 60 × 320 = 19,200 EUR/year, with an announced 8%/year increase. Over 5 years compounded: ~112,700 EUR. The custom build is quoted at 85,000 EUR plus 15,000 EUR/year maintenance = 145,000 EUR over 5 years. Over 5 years SaaS stays cheaper, but Karim projects 120 users in year 3: SaaS would then jump to ~38,400 EUR/year, overtaking the build from year 4. He picks custom to lock his cost and keep his strategic flow data. Estimated saving over a 6-year horizon: over 40,000 EUR.
FAQ
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How do I compute the tipping point simply?
Divide the total build cost (dev + cumulative maintenance) by the annual SaaS cost. If the result is below your real usage horizon, custom is profitable.
Is SaaS always faster to deploy?
Yes, almost always: 2 to 6 weeks versus 3 to 6 months. If time-to-market is critical, start on SaaS then internalize if volume justifies it.
Why does data control matter in the trade-off?
Because your flow, customer or pricing data can be a competitive edge. Hosting them at a vendor creates dependency and complicates advanced analytics or AI on your data.
Is SaaS price inflation predictable?
Partly: many vendors raise prices 5-15%/year and change tiers. Lock a multi-year contractual rate if you stay on SaaS.
Can you start on SaaS then switch?
Yes, it is a prudent strategy: validate the need on SaaS for 12-24 months, then build custom once the process is stable and volume known.
Let's scope your project. Give us the annual SaaS cost, user count and usage horizon: we compute your tipping point and cost the build. Detailed quote within 48 h. WhatsApp +221 77 596 93 33.
Mohamed Bah
Fondateur, Kolonell
Passionate about digital and entrepreneurship in Africa, Mohamed has been helping Sénégalese businesses with their digital transformation since 2020. Founder of Kolonell, he believes every SME deserves a professional and accessible online présence.
