Total Cost of Ownership: Noble Way to Avoid Hidden Fees in eCommerce Platform Implementation
Total cost of ownership is a financial analysis that estimates the total cost of a product or service over its complete life cycle. Such an assessment includes short- and long-term expenses as well as direct and indirect costs of a product or service.
Software product development is complex and involves multiple processes, so its overall cost may exceed an agreed at the start of the project budget. And this fact frequently puts all further business growth at risk.
Calculating the total cost of ownership can be considered an effective practice for staying on budget and reducing operating costs during or after the project implementation.
Implementing and maintaining an eCommerce platform involves licensing fee, hosting, ready-made extensions or custom features development, web-design etc., and every element and all potential adjustments must be kept in mind as far as possible.
When implementing an eCommerce solution, you can start with proceeding from the following options:
- On-premise. In this case your eCommerce platform will be based and run on your organization’s hardware system. Preliminary costs will consist of servers and licensing fee. Current costs include maintenance and support on a 24-hour basis, security, updates, backups and so on.
- Cloud. This option lies in managing the platform in the cloud. For example, Magento Commerce Cloud runs on Amazon Web Services, a cloud computing service provider.
- SaaS. It stands for software as a service. When you opt for SaaS, your software will be hosted and maintained by a third-party.
Weighing the pros and cons of every approach can give you a vivid idea of which option your business will certainly benefit from. Also, you could involve your marketing, sales and other teams in the process of selecting an eCommerce solution, as it might help to determine the exact preferences, like functionality set, and forecast unexpected issues in the future.
Choosing a certified solution partner
Replatforming your pre existing eCommerce website or developing a website from scratch would also require a team of talented specialists that offer services in front-end and back-end development, project management, web-design, business analysis etc.
To specify the budget, it’s necessary to decide if you are going to use your own strengths or hire a certified solution partner.
From a financial perspective, hiring Magento developers is a more reliable option, as they have enough skills and expertise to help you make your project affordable and launch it in a timely manner.
You can find more benefits of working with solution partners in this article.
In conclusion, calculating total cost of ownership is a challenging moment that needs taking into consideration various aspects. But once everything is heavily checked and regulated, it will definitely help to prevent mistakes in the future.