SaaS vs. On-premise Software | Which one to choose? | Floway
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SaaS vs. On-premise software

Almost every business now uses some kind of digital tools. Which one to choose, SaaS vs. On-premise software? Saas market takes over, both in business and domestic use. Why? Does it mean that on-premise software is no longer needed? Which software should you invest in? Learn that and more in our article.


What is a SaaS?

A SaaS platform means Software as a Service and is a type of service, where software is stored in a cloud instead of a device. The application is distributed to its users via the internet usually through a subscription model. SaaS doesn’t require specific hardware and can be accessed by any device with a browser and internet connection. Thanks to that accessibility, the SaaS market is booming globally with an estimated $186.6 billion in 2022.

SaaS advantages

  • Accessible on any device with a browser and internet connection
  • Transparent costs with steady expenditure instead of a big one every few years
  • Little commitment upfront due to lower cost
  • Automatic updates and new features
  • Supports decentralization and remote work
  • Maintenance is on the vendor’s side

SaaS disadvantages

  • No control over updates
  • Requires internet connection
  • You lease, not own the software
  • Limited customization
  • Dependency on the provider’s servers


On-premise software

Traditional on-premise software is bought and then installed on a device. It usually requires a code to install that can only be used once or in the case of custom software, the whole implementation by the vendor. This way, the software is meant to be safer, due to the entire software residing within an organization’s premises. Some businesses feel more protected knowing that their data is stored in-house on their servers. However, infrastructure maintenance and hardware updates are necessary and expensive, on top of the purchase of the software itself.

On-premise software advantages

  • All data is securely stored on companies’ servers
  • You own the software
  • Offline access is possible
  • Unlimited customization
  • Full control over the software

On-premise software disadvantages

  • High-cost up-front and expensive upgrades
  • Accessible only on the company’s devices
  • Maintenance is on the company’s side
  • Extra costs due to IT personnel, hardware, performance tuning


Which one to choose? SaaS vs. On-premise software

Every company is different and choosing the right software might seem like a huge committment. There are a couple of key points you need to keep in mind, when deciding on SaaS vs. on-premise software. For example business needs, costs, and the future of your company.

Business needs

The first thing you need to consider when choosing business software is your business needs. Does your business operate in a niche that requires managing unusual tasks? Or standard HR onboarding/offboarding, correspondence, sales management, etc.? Look at some SaaS features and see whether they’d be enough. But if your company has very specific needs, you might want to invest in on-premise software.


Another important aspect is cost. The biggest advantage of SaaS is its price competitiveness compared to on-premise software. Most SaaS has a free trial that you can test out before committing to a subscription. Even when subscribed, it’s more cost-effective than on-premise software due to no maintenance costs. SaaS providers use top-notch security and servers to ensure the quality of their products, thus saving your business a fortune in the long run.


Purchasing a software or subscribing to SaaS is a choice one doesn’t want to change often. Take into account a few scenarios of scaling your business and compare them to the software you’re looking into. What will your business look like in one, two, or five years? Does your company’s growth require more staff or improved operations? This way you can choose not only a tool that works now, but also in the future.


Try Floway

If you’re still on the edge on which software to choose, try Floway. It offers professional implementation, customizable features, and security of on-premise software, with the advantages of SaaS. Manage your business procedures, create forms, generate documents, and much more. Floway is an interdepartmental tool that can be used by any industry.

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