Custom software development is the process of designing, creating, deploying and maintaining software for a specific set of users, functions or organizations. In contrast to commercial off-the-shelf software (COTS), custom software development aims at a narrowly defined set of requirements.

Microsoft Office and Sitebuilder.com, for example, are packaged commercial software products and services. They meet the generalized needs of office productivity and website creation.

Custom software, on the other hand, is designed for a specific set of needs, such as:

a field service equipment maintenance program for a manufacturer or an online banking app designed for the unique requirements of the bank and its customers.

Custom software development is usually performed by in-house development teams or outsourced to a third-party. The same processes and methodologies apply to custom software development as other types of software development. A custom project would move through the familiar steps of requirements gathering, code construction, testing and deployment and apply the same methodologies, like Agile, DevOps  or Rapid Application Development, as any other software project.

Benefits include

Efficiency: Custom software is purpose-built to support processes swiftly and productively, without the need to tinker with or adjust COTS applications.

Scalability: Custom software can grow as an organization or business grows and changes. Designers and developers can assess future needs as part of their requirements gathering. These factors can then be incorporated into the application, rather than incurring costs by purchasing additional licenses or subscriptions of packaged applications.

Lower integration costs: One of the chief considerations of commercial software is: will it work with existing and legacy applications? If the answer is no, organizations face a further investment in getting commercial software to communicate and operate with their existing infrastructure. Custom software can be built to integrate with its intended environment.

Profitability: It’s possible to make money with custom software development. Depending on the terms and conditions of the project, businesses that develop their own software may own the software and therefore be able to license or sell it to other organizations.