ERP guide
Should a company buy an ERP system or build a custom one?
Buy an ERP system such as Oracle NetSuite when your operations are close to standard and you want proven accounting, inventory and order management from one vendor. Build a custom ERP when you would spend the subscription budget on modules and consulting to match your own process, because over five years the product keeps charging and a system you own has no license fee.
| What you are comparing | A product | A custom build |
|---|---|---|
| Cost over five years | A subscription every year, built from users, modules or resources depending on the vendor, plus implementation, data migration, training and the consulting needed for changes. Most ERP vendors publish no price, so the total starts as a quote. | A one-time build scoped in writing, then running costs such as hosting, database and email. No licenses, so the total does not rise with headcount or with each new function. |
| Per-seat fees | Usually. Microsoft, SAP and Odoo publish per-user prices, and NetSuite counts users in its license. Acumatica is the exception on our lists, pricing by resources and not by seats. | None. Adding a warehouse worker, an approver or a read-only executive adds no fee. |
| Fit to your process | You adapt the business to the product, or pay to change the product inside the limits the vendor allows. What it cannot model ends up in spreadsheets beside it. | Built from your process, including the pricing rules, approvals and handoffs between departments that are specific to you. |
| Time to launch | The contract can be signed quickly, but an ERP rollout is a project of its own, with configuration, data migration and training before anyone can work in it. | Starts with discovery and a written scope. We show working screens during the build, and that scope sets the schedule. |
| Accounting and compliance | A mature general ledger and tax handling come with the product and are maintained by the vendor. | We usually keep a proven ledger for statutory accounting and build the operations around it, connected so numbers are entered once. |
| Changes after launch | Limited by what the vendor exposes and by your plan. Larger changes go through a partner or consultant and have to be maintained afterward. | Anything can change, because you own the code. We scope and build changes as you need them. |
| Vendor risk | Pricing, packaging and roadmap are decisions the vendor makes, and renewal quotes can change. | No vendor to renew with. The risk moves to keeping a maintainer available, which owning the code and the accounts is designed to cover. |
When buying an ERP system is the right answer
Buy when your operations look like most operations in your industry. Standard order to cash, standard purchasing and standard accounting are what ERP vendors have spent decades building, and a product gives you that along with a vendor who maintains it.
Buy as well when the need is mainly financial. A general ledger, consolidation and tax are solved problems. Nobody should build those from nothing when a proven product does them.
When building a custom ERP is the right answer
Build when the product has become a project. The signs are that a spreadsheet runs beside the ERP, one person re-keys data between two systems, and the list of change requests to the partner never gets shorter.
Build when what makes you money is the part no product models. If the way you price, schedule or fulfill is your advantage, a standard system asks you to give it up or pay to rebuild it inside a product you rent.
How to compare the cost of an ERP system with a custom build
Do not compare a first-year quote with a build. Compare five years. Add up the subscription at the users and modules you will need, the implementation, and the consulting you will pay for changes. That is the product number.
The custom number is a one-time build plus running costs. Black Badger does not publish a price, because the figure depends on what the system has to do and how many other systems it has to agree with. A written scope gives you the number to put beside the product total.
What a custom build involves, and how to ask about one
Questions buyers ask
Is a custom ERP cheaper than NetSuite?
A custom ERP is not always cheaper than NetSuite in the first year. NetSuite publishes no price, so the comparison starts with your own quote. A build costs once and a subscription repeats, so the comparison usually moves in favor of custom as years, users and modules add up.
Does a custom ERP mean rebuilding accounting from nothing?
No, a custom ERP does not mean rebuilding accounting from nothing. In most builds the general ledger stays in a proven accounting product and the custom system handles the operations around it, with the two connected. You get your own process without taking on risk in statutory accounting.
What if the developer who built our custom ERP disappears?
A developer disappearing was the main risk with custom software for a long time. Black Badger answers it two ways. Every account the system runs on is created in your name, and the code is written so that another developer can read it and carry on.