Custom Software vs. Off-the-Shelf ERPs: How to Choose the Right Option for your Craft Brewery

Custom functionality can provide long-lasting value when done right.

In today’s business world, it’s hard to boost productivity without automation and in the craft brewing field that’s certainly the case. But…

• Today’s craft brewery owners and managers are under greater pressure than ever to drive productivity and therefore higher profits.
• Employees can’t finish their tasks without the right tools at hand.
• Brewers that equip their employees with the best tools are able to earn the most profits
• The right tools cost money and bad choices waste money

… So, how do you balance all of these factors –after all it’s one thing to produce great beer with productive employees but you want to be in business for the long haul, right? The decision to improve business processes involves a trade-off between the time-expense of manual tasks and the actual cost of deploying automated software. The key to success in nearly any sector is finding the right balance between these two costs.  The choice between building custom software from scratch and using commercially available software has powerful implications on how this balance is achieved. For many brewery owners, it is the first choice that should be made when looking for ways to improve overall business productivity.

Custom Apps vs. Off-the-Shelf Solutions

Custom apps include internal databases, business portals, and software solutions built strictly for employees to use. These are production management, customer relationship management (CRM) and enterprise resource planning (ERP) solutions developed from the ground up and hosted on cloud-based servers accessible from any web browser. Off-the-shelf software includes some of the biggest names in the tech world. For example, Oracle’s Netsuite software or SAP Business One Cloud are cloud-based ERP applications used by tens of thousands of businesses all over the world. Each solution comes with a specific set of advantages and drawbacks. Understanding how these factors contribute to the overall ROI each option offers is crucial to making the right choice.

Custom Apps Pros and Cons

Building your own custom software from scratch can be a valuable long-term decision for a growth-oriented brewery for the following reasons:

• Custom software developers can combine any number of features, functions, and modules into a single, streamlined product.
• Your company can enjoy complete ownership of the software itself.
• Changes, updates, and maintenance are simpler to implement than with off-the-shelf solutions.
• The software only includes the features and functions that your brewery needs and none that you don’t.
• Custom API development allows for wide-ranging third-party integrations.

Some of the disadvantages of developing custom software from scratch include:

• Custom software development involves high up-front costs.
• Custom software can take months to develop.
• If you choose the wrong developer or company, the project may turn into a money pit.
• Solid leadership is needed to ensure the project stays focused on the problems it was originally designed to solve.

Off-the-Shelf Software Pros and Cons

Many successful breweries work with off-the-shelf ERPs, CRMs, and other software solutions. This can provide a competitive edge in the following ways:

• Off-the-shelf software is cheaper to implement, although subscription licensing may make it more expensive in the long run.
• Finding and retaining talent with skills in widely available software is simpler than hiring talent capable of working in a custom software environment.
• Online user communities make it possible for employees to solve problems without resorting to IT support.
• Off-the-shelf software can be more reliable than custom software thanks to the ability to perform more comprehensive QA testing.
• Off-the-shelf software solutions that already have a templated implementation approach (e.g. OrchestratedBEER) reduces time to deploy and therefore cost.

However, off-the-shelf software does carry some important drawbacks:

• It is difficult and sometimes impossible to customize off-the-shelf software.
• These software titles tend not to adapt to future craft brewing industry needs as well as custom systems can.
• Most off-the-shelf solutions include features and functions that users don’t need but pay for anyway.
• Because commercial software is designed for many different types of users, compromises and workarounds are common.
• No guarantee on API availability. Some vendors support third-party integration; others don’t.

Which Option Is Right for My Business?

There is a good reason why large-scale enterprises with thousands of employees tend towards custom software deployments. Although the up-front cost is higher, scalable automation and productivity benefits make custom development a far better long-term choice. Smaller breweries tend not to invest in custom management software because they cannot afford to. Often, core business needs take priority over building the most efficient processes. It’s impossible to offer a one-size-fits-all answer for determining which software option is better in all cases. Instead, executives and corporate stakeholders need to examine the factors that best predict successful outcomes. This requires taking a careful look at the problems that you would like your software solution to solve. Hiring an experienced consultant early on can be of major help when answering the following questions:

1. What is the scope of the project?

Every brewery software-related project that a business takes on must serve a specific purpose. The more comprehensive and well-defined the project is, the less likely it is to become a victim of scope creep later on. For example, perhaps being competitive in the craft brewing industry requires giving customers access to exposed processes online. This is a common need among banks, airlines, healthcare clinics, insurance companies, and the vendors they work with. You will want to carefully define the problem that process automation must solve before you can actually solve it.

2. What is the product budget?

Once you have determined the problem that you expect your brewery software to solve, you can build a reasonable budget around it. It’s important for the budget to reflect the size and scope of the problem itself. Spending $250,000 on a custom software deployment might sound like an enormous expense. But if your brewery has a problem that is costing it $1 million dollars per year, spending 1/4th of that sum on fixing it might not be such a bad idea.

3. What will the impact of project success be?

Implementing new brewery software—whether custom or otherwise—is a monumental process that will impact many different areas of your business’s day-to-day life. Many executives and stakeholders get so caught up in the idea of optimizing processes with software that they fail to clearly define what solving the problem looks like.

Audit Your Processes with Expert Help

Whether you’re leaning towards custom development or an off-the-shelf software upgrade, the help of an experienced consultant is invaluable. Breweries don’t go through technological transformations every day—you want to inform your decisions with the insight of a professional who takes the time to learn your business inside and out before offering advice. Get in touch with the SMB Solutions team to learn more about our OrchestratedBEER offering and the single source of truth.