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Custom Software vs. Packaged Software

In the software development process, two terms appear very similar to each other: custom software and packaged software. In this article, we shall discuss the various similarities and differences between the two to help you identify which type should work best in providing business solutions.

Custom Software versus Packaged Software Software developers coding on computer with script. Coding, engineering, interface design flat vector illustration. Programming concept for banner, website design or landing web page

Image Source: Freepik

What is Software Development?

Software development, according to IBM, involves a “set of computer science activities that are dedicated to the process of creating, designing, deploying, and supporting software.” Thus, because software is a set of instructions, it can tell a computer what to do – a feature that makes them programmable.

There are three basic software types: system software, programming software, and application software. Firstly, system software provides core functions, including operating systems, utilities, disk management, and hardware management. Moreover, programming software provides tools like linkers, text editors, debuggers, compilers, and others to create code. Lastly, application software or apps help users in the performance of specific tasks, which include media players, security programs, and data management software. Also, applications include those used to shop, socialize, and post pictures, such as Lazada, Facebook, Twitter, or Instagram.

Custom Software vs. Packaged Software

We all utilize various software on our devices (mobile phones, laptops, computers, etc.). However, not all of us are familiar with their types. We can classify software under two main categories: custom software or packaged software. Packaged software is made available for public consumption while custom software is made specifically for an individual or an organization for a purpose.

Firstly, packaged software is developed and sold by developers for an actual market price. Moreover, it is a collection of programs grouped to perform different functions. You will find it difficult to modify or alter these programs. Generally, developers group these programs and give them a specified name, and provide solutions to people. A clear example of a packaged software would be Microsoft Office, which includes tools such as Word, PowerPoint, Excel, Access, and Note.

Custom software, on the other hand, is a specifically-developed program created for a particular purpose. As such, this software tends to be priced higher, depending on its purpose and complexity. However, unlike packaged software, custom software can be altered or modified when needed that is one of the reasons why the cost of custom software is pretty high. For instance, a company may request for the development of a custom-built management system to keep track of its employees’ working hours

Comparing Packaged Software and Custom Software

Below, we have provided a table comparing the two types of software:

Definition Collection of programs grouped to provide publicly different tools from the same family Specific and advanced program developed for one purpose for an individual or a company
Availability Available to the public and sold at particular prices Not commercially available, but is exclusive to third parties
Installation  Generally installed by third-party consultants Generally installed by an in-house team
Usability Simple to use, owing to a straightforward interface Complicated to use because it is custom-built
Implementation  May not require the design and development team Involves the design and development team
Integration Usually more difficult to integrate with other software Easier to integrate with other software
Modification You cannot easily modify You can modify when needed
Upgrades Tends to follow the supplier’s marketing objectives Focuses on the improvement of processes
Pricing May be cheaper, but it can end up being costly when making adjustments May require a higher investment, but the ROI will also be higher
Success Measure Market sharing and profitability User satisfaction and acceptance

Utilizing Custom Software to Address Business Needs

Science Soft defines custom software development as the process of addressing the specific objectives and needs of a business by offering tailored solutions through designing, building, integrating, scaling, and upgrading software solutions.

Upon examining the table above, you can see the many benefits that you can get when employing custom software into your workflow.

As such, if you are on a software developer hunt, then you need to crowdsource or get recommendations from people or businesses who have hired custom software development services before. Moreover, you should also check a software development company’s previous projects to see if they can cater to your specific needs. Other than that, you have to check if they value the significance of finishing a project on time. You can also visit their social media pages or business website to evaluate their online market presence and reputation in the field.

Custom Software versus Packaged Software Application Developers

Image Source: Freepik

Get the Right Custom Software Development Company for the Job!

For business owners, it is only natural to properly weigh your decisions first before employing the type of software to implement into your work activities.

The market provides you with countless programs and tools that aim to help improve your business. However, these programs and applications cannot cater to all business types and requirements. Companies require software that offers solutions and can be easily adjusted according to their specific needs.

But with custom software development from the Philippines to provide you with tailor-made software, programs, and applications, you can not only maximize your work efficiency, but you can also increase your profits and return of investment.

So, which type of software are you more inclined to use: packaged software or custom software? Tell us in the comments section below!

Xenia Labis


Xenia loves to learn and share what she has learned. She gathers all her learnings through reading books, watching videos and deep conversations. Nevertheless, she believes that the greatest learnings she has gathered are through her experiences.

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Comment 1

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    Web Designers in Clearwater, FL
    Nov 28th, 2020 - 4:35 pm - Reply

    Thanks a lot for writing such a wonderful article. Well written and the guideline is awesome and essential to follow. I’m looking forward to more informative posts further and I like to wish you all the best.

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