Open-Source vs SaaS eCommerce Platform: Pros and Cons (2023)

The question of which eCommerce platform to choose is very common among online businesses. There are so many solutions to pick from and so many aspects you need to consider before making the decision. Flexibility, functionality, security, cost – the list goes on. Knowing which type of platform better fits your business needs — open-source or SaaS eCommerce platform — will eliminate a lot of uncertainty and make the choice a lot easier.

What Is a SaaS Platform?

A SaaS (Software as a Service) platform is owned and supported by a third-party provider who licenses it to other businesses. With a SaaS platform, you get all the necessary features for your online store from the start, and you do not have to worry about hosting and maintenance. This helps businesses get a quick start and begin selling their products right away.

These types of platforms do not provide access to their source code and rely on the platform provider to support your business with the necessary tools and features.

In addition, SaaS platforms work on a subscription model, meaning that you have to pay regular subscription fees and, in some cases, additional charges (e.g. transaction fees).

Pros and Cons of SaaS

Let us start with the SaaS advantages:

• Launch speed. SaaS platforms are characterized by high launch speed. Vendors usually offer guides, tutorials, and educational resources that help businesses quickly open online stores. The UI of SaaS ecommerce platforms includes a number of pre-built features that simplify the user path to launching the ecommerce business.
• Intuitiveness. It’s true that not all SaaS platforms are intuitive. But if you choose a recognized vendor, you increase the chances to get a user-friendly solution. SaaS platforms are easy to use and maintain. Usually, it can be done by people having no tech background. However, the other side of this issue is narrowed opportunities for scaling.
• Data security. If you use a SaaS platform, you won’t worry about security problems. The responsibility for your data protection is put on the vendor you choose. To be sure that you picked a secure option, choose among PCI-compliant solutions.
• Client support (usually comes for free). SaaS teams provide their users with dedicated on-demand support. You can get in touch with the support team personally, and they will solve your issue. The quality and availability of customer support depend on the number of employees involved, the communication channels used for interaction, and the urgency of your problem.

Now, we discuss the SaaS cons.

• No flexibility. If you experience a tech difficulty or bug, you can’t fix it by yourself. Your team needs to wait for a provider to solve the problem. Suppose that your website or your management system is down under high traffic during the peak season. To fix the problem, you need to contact the support team. No one knows how much time it will take for them to recover your software. And each minute your solution does not work — you lose your prospective clients.
• Harder to customize. The right to add new features or functionality is given only to a vendor. That is, you won’t be able to customize your ecommerce solution if your vendor doesn’t allow users to do so. And if you fail to offer a unique brand experience, you lower your competitive power. To get unlimited customization opportunities, choose open-source ecommerce platforms. When you use such a platform, your software engineering team gets control over the code and can adjust it to your needs.
• Dependence on the vendor. When you use a SaaS ecommerce platform, you are limited in choice. The options you can choose from are defined by your vendor. If you want to improve some functionality and make it more user-friendly, you have to wait for the vendor to do it for you.

What Is an Open-Source Platform?

An open-source eCommerce platform, on the other hand, provides full access to its source code, allowing users to change, customize, and adapt it to their business needs. This brings a great deal of flexibility, which is especially important to growing businesses that require tailored solutions to fit their specific needs. Furthermore, they allow users to build completely custom tools (e.g. Product Information Management (PIM), inventory management, etc. without the need to rely on ready-made ones.

However, to take full advantage of the benefits of an open-source platform, you would have to acquire assistance from experienced developers with expertise in eCommerce development. Among the most popular open-source platforms are Magento, WooCommerce (a WordPress plugin), Open-Cart, and nopCommerce.

Pros and Cons of Open-Source Platforms

If you think that the customization capacities of open-source ecommerce platforms are their one and only benefit, you should keep reading. Open-source platforms are good because they offer:

• Complete awareness of what’s happening with your store. Open-source ecommerce platforms give you complete control over your store’s functioning and performance. If you plan to rapidly scale and introduce big changes to your solution, this type of software is exactly what you need.
• Big and dedicated community. Open-source ecommerce solutions are targeted at a big audience. As a result, there are a lot of experts worldwide who specialize in particular ecommerce technology. They eagerly share their insights and achievements with the community on GitHub. Your ecommerce development team can make use of it and regularly improve the security, performance, and intuitiveness of the solution.
• Flexibility. You can customize your store to give it a branded appearance and personalize the user experience. Compared to SaaS ecommerce platforms, open-source solutions give businesses more flexibility to choose how their stores will look and work.
• Ecosystem freedom. It often happens that SaaS vendors try to lock clients in their business ecosystem. That is, a client purchases access to a solution. But it turns out that the solution lacks some essential functions. Also, it turns out that the vendors offer these functions in another piece of software. And clients have no choice but to invest in one more piece of software to keep their business operations consistent. This is not the case for open-source platforms. They give you the freedom to choose what solutions to integrate and what add-ons to select.

As for the disadvantages of open-source software, these include:

• Security gaps. Open-source platforms have open code, which can be viewed and changed by anyone. This is why there are lots of security vulnerabilities when it comes to this kind of software. Though, there’s a way out. Security plugins and third-party integrations can improve the protection of your solution.
• Responsibility. All code modifications and changes are the responsibility of your team. The more you customize your website, the more complex code becomes. It may pose a challenge when you plan to introduce some changes or improvements.
• Maintenance costs. Sure, some open-source platforms for ecommerce offer free plans. But sometimes, this is not enough for a growing business. As you scale up, you will need more functions and features. Adding them to your ecommerce webstore and maintaining high website performance will come at a cost.

Comparing the Features of Open-Source and SaaS Platforms

Scalability and customization

SaaS platforms have all the necessary features to quickly set up an online store and rely on their provider to develop and implement additional tools and features. However, restricted access to the source code makes both customization and scalability a bit tricky.

When looking for a specific feature, you have to choose the one that best fits your needs. Sometimes, the tool that you are looking for may be unavailable or non-existent. In such a case, there is not much you can do but hope that the platform provider eventually implements the feature you need – developing it yourself is not possible.

Open-source platforms, on the other hand, exceed in customization and scalability. You do not have to rely on the platform owner – your technical team can simply build the feature that will be tailored to your specific requirements whenever you need it.

More importantly, you can easily adjust various aspects of your store (for example, the checkout process) and make it more appealing to your specific audience. One of the best ways to ensure your customers complete their orders is by providing a convenient and memorable experience. It is well known that a happy customer is a repeat customer, so having the ability to appease your clients should not be underestimated.

When deciding which eCommerce platform to choose, it is important to think about the goals and the future of your business. Businesses with no aspirations for significant scaling or customization can get all they need from a SaaS platform. Developing businesses, however, may want to look towards open-source platforms that can provide a significant boost to their growth.

Security, maintenance, and support

When it comes to cyberattacks, eCommerce is the second most attacked industry in the world. Therefore, the security of the personal data of your customers (e.g. payment information) should be of the utmost importance to all online merchants.

Both types of platforms are more than capable of making an online store secure. The difference is that with SaaS solutions, ecommerce website security and maintenance are taken care of by the provider, while open-source users have to task their technical team to make their store secure and updated with the latest patches.

This may seem like a drawback but it is actually a blessing in disguise. It gives merchants full control over their store, allowing them to optimize it in a variety of ways: from increasing page load speed to improving their infrastructure. Something that is not possible with closed platforms.

Where closed platforms do exceed, however, is in offering reliable support. Platform providers take great care of their product to ensure that customers (i.e. eCommerce merchants) have a smooth experience and do not face any issues – their reputation is on the line, after all. By going with a third-party platform, you can be certain that if you experience any issues, your provider will be quick to solve them.

Open-source platforms, on the other hand, do not have a dedicated support team. If an issue occurs – your technical team would have to solve it by themselves. Luckily, most open-source platforms have accumulated large communities of developers who can offer advice and assistance when needed.

Cost and set-up time

Most closed eCommerce platforms work on the subscription model – the user has to pay a monthly subscription fee to continue using the solution. Moreover, there are additional charges that you need to be aware of, like transaction fees. Shopify, for example, charges a transaction fee for each completed purchase in your store which, depending on your plan, ranges from 0.5% to 2%.

However, these types of platforms are quite easy to use and do not require additional assistance from developers to make them work. Therefore, you do not have to worry that your project will incur additional development costs. If you need to start selling your products quickly – a third-party solution will allow you to set up your store in no time.

An open-source eCommerce platform like Magento, on the other hand, is completely free. There are sometimes paid versions with additional benefits, (e.g. Magento CloudCommerce ) but everything you need for eCommerce store development is available in the free version as well.

When it comes to additional charges like transaction fees, an open-source market is a bit of a mixed bag: some have them (WooCommerce, nopCommerce), and some do not (Magento). Therefore, you have to do some research to get the full picture before choosing the platform. However, in both cases, there are no subscription fees that you have to keep in mind.

What you do have to keep in mind is that these platforms, most of the time, require a bit more time and effort to truly shine. If you want to build something unique that will help your business in the long run, you have to be prepared to invest in a team of experienced developers who can help you.

Which eCommerce Platform to Choose?

Without exaggeration, choosing the eCommerce platform that fits your business needs can be the difference between success and failure. Hopefully, the information above has provided some clarity on the two types of solutions and will help you decide which type of solution better fits your business. If you require any additional assistance with your eCommerce project – feel free to reach out, our experts are always happy to help.