Advantages and disadvantages of SAAS e-commerce platforms
Listed here are some advantages and disadvantages of SaaS e-commerce platforms.
SaaS is short for Software-as-a-Service. SaaS platforms are cloud-based apps licensed to a user who then accesses them online. It is a subscription-based service where merchants pay a monthly fee for its use. It is a cost-effective means for merchants to keep track of transactions on their e-commerce platforms.
Due to the rapid growth of the e-commerce business model, many software companies have rushed in to cash in on the sale of apps and supporting software to feed the industry. This multi-billion industry has seen the rise of many providers, including:
- Big Commerce
- CA Technologies
Cloud computing is revolutionizing how we do business today. Users can manage their supply chains with eases through a common platform. Companies can share information and business processes with their vendors, suppliers, or other related entities.
SaaS Platforms are essential for the operations of many e-commerce businesses; a good example is companies that deal with logistics and shipping. For example, shipping labels and order fulfillment service providers can rely on SaaS platforms like Woocommerce, to deliver products to their clients despite a large number of products.
All systems have strengths and weaknesses, and SaaS technology is no different. Listed here are some advantages and disadvantages of SaaS e-commerce platforms.
1. Remote functions
One of the main benefits of the SaaS platforms is the fact that the software is not installed on the premises of the user, cutting out the need for expensive space. The system is also not managed by the user, saving them personnel costs. Your e-commerce platform operates on the SaaS provider’s hosted servers, and the hosting company provides security, optimal performance, and maintenance of the app on their servers.
2. Shared functions
Most SaaS e-commerce platforms have an in-built shopping cart functionality. Users can take advantage of prebuilt and customized services instead of spending time and resources building their systems. Shared functions contribute to massive savings to the users
These features allow entrepreneurs to set up e-commerce businesses quickly and cheaply without the stress of having to look for and focus on other areas to drive growth.
Another huge advantage of the SaaS e-commerce platforms is the user’s freedom from maintaining software. With the hosting provider tasked with the responsibility of preserving performance speed, uptime, software bug fixing, software updates, security, and integrity of the systems, your store can run smoothly and efficiently.
4. Security and PCI compliance
For you to sell online, you must be Payment Card Industry (PCI) compliant so that you can ensure the security of your customer’s payment information. SaaS providers advice and ensure your PCI compliance so they can maintain the security on their platforms.
Customers need to trust you with their information. Hackers are all over; no wonder people are wary of giving out their information to anyone, and for your business to grow, you have to ensure the utmost security of their payment information.
Growing e-commerce businesses need to scale up their capabilities as they grow. As they gain more customers, so do their orders increase, requiring more advanced functionality like that only available with cloud computing.
According to Wavestone, Cloud is supposed to take care of the problem of technical debt. The problem of replacing hardware vanishes because the cloud is built in such a way that it is upgraded regularly, without looking at the infrastructure underneath it.
SaaS e-commerce platforms are built in the cloud and it can offer that upgrade for you to add new sales channels without incurring additional high costs.
The relative cheapness of the SaaS e-commerce platforms and the direct benefit to the entrepreneur makes it an attractive option. You save yourself the dizzying costs of building an IT system from scratch. You save yourself the inconvenience of maintaining your servers and dealing with technicians to fix bugs and revive crashed websites.
1. Lack of Customization
While some features like prebuilt templates and other features offer built-in functionality on SaaS platforms, make it easy and quick to use, it can also limit you in some ways. SaaS providers don’t give users access to the software codes, so it would be impossible for you to make any changes if you needed a unique functionality to your operations.
2. Complex Processes
Complex business processes need advanced customization, and this may not be available in the SaaS platform you’re using. Due to the nature of the business you’re doing, very complex transactions may arise, like selling across multiple markets or dealing with various currencies in different sales.
3. Lacking B2B Needs
Most SaaS platforms serve Business to Consumer (B2C) transactions, and so if you’re a Business to Business (B2B) seller, you will miss out on this even if you’re an e-commerce business. Issues like customer-specific pricing, discounts on quantities, and staggered payment terms don’t work so well with SaaS platforms.
SaaS Platforms Can Work For All
SaaS platforms are not only for large companies; this is far from the truth. There are numerous apps available for start-ups and SMEs, and you can always shop around to find the best.
- The rise and rise of SAAS companies
- SaaS: Peculiarities of the business industry
- Here’s a checklist for pre-launch of a SaaS product
- Software on demand: 7 of the best web-based software for your business
Editor’s Note: Saif Abbas is a writer, part-time entrepreneur and digital marketing consultant that has worked with Fortune 500 brands and top startups across the globe. He is also a regular contributor to media outlets, including Huffington Post, Drift, Forbes, Ahref, Moz, Search Engine Land, and others.