Should I Choose Open Source or Hosted Software for my Ecommerce Site?

open source vs hosted ecommerceThis post is part of a series of expert answers to frequently asked questions about ecommerce, helping you make the right choices for your business.
 

Your Question: I’m having difficulty making an eCommerce platform decision. Should I go with an Open Source platform on a server or one of the hosted solutions, such as Volusion? Can anybody please help me figure out what would be better? Thank you for any feedback.

Answer by New Edge Design’s Shai Atanelov:

This is an extremely important and common question, and one I hear every day. It seems that most small-to medium-businesses struggle with this decision at some point in their ecommerce journey.

In my opinion, only someone with extensive experience in managing ecommerce stores on both Open Source and hosted Software-as-a-Service platforms can really answer in an informed way, with a deep understanding of the pros and cons of each option.

I feel qualified since I have extensive experience developing and managing multiple ecommerce stores on a variety of platforms for New Edge Design’s clients, and for my own ecommerce ventures.

So let’s address this question!

Which is Better, Open Source or Hosted?

This is a very interesting theoretical question that techie types enjoy debating endlessly on forums. However, this question has no relevance to the average business investigating ecommerce solutions.

The right question you need to ask is: Which is better for my particular ecommerce situation, Open Source or Hosted?

That depends on three main factors:

  • Your budget
  • Your company’s programming talent (in-house or outsourced)
  • Your must-have requirements for store features

These three factors come into play in different ways when making your choice. So I created this handy table to help you compare the pros and cons of Open Source vs. Hosted solutions, in areas related to cost, capability and support.

Hosted Ecommerce Software vs. Open Source

Ecommerce Software

Hosted Solution (SaaS) Ecommerce Software Open Source (Self Hosted) Ecommerce Software
Setup Cost Low setup costs (or moderate setup costs for a custom design) High or Very High setup costs (for code customization, template integration, testing, implementation)
Skills Can be implemented and maintained by anyone with decent computer skills There is a high learning curve for most users.
Easily implemented and maintained by a specialized developer
Hosting Hosting included in cost, upgrades and downgrades are smooth Hosting fees charged separately, and upgrading and downgrading server capacity is complicated
Features Limited flexibility, but many useful features are included, without paying for extensions or custom coding Great flexibility to customize features through extensions and custom coding – but these cost
Support Full support from software developers included – just one number to call No support from software developers – support must be contracted privately
Upgrades Upgrades, bug fixes and new features pushed out to all stores automatically, with no work for the store owner Any customizations of code have to be manually integrated with future versions and bug fixes released by the software developers
3rd Party Software Integration Only with pre-approved partners since no access to root files are provided Root files are accessible and basically any 3rd part software can be integrated

When consulting with a client, we work to find which solution is the best ecommerce solution for them.

But in reality, a hosted SaaS solution is usually my first choice, unless for a particular reason I’m convinced that OS is the best solution for them.

Open Source is usually the best choice for businesses that meet these 3 conditions:

  • They have a PHP developer specializing in the OS cart of choice in-house (or an expert external team, such as our own)
  • They need total flexibility and ability to customize their site in highly specialized ways that are not possible with hosted solutions
  • They have a significant budget for set-up costs and ongoing development maintenance

If they don’t meet these 3 criteria, I usually recommend a hosted solution, especially Volusion and BigCommerce, since they have so many features built-in, an easy-to-use interface, and good support. Also they don’t charge transaction fees, like Shopify does.

Making the Right Decision

Choosing the right ecommerce platform is one of the most important decisions you will make for the future success of your online store. It is not a decision that anyone should
take lightly or make for you without knowing about your business situation.

If you are feeling unsure about which platform is right for you, then contact us for a consultation, or leave a comment below. Be sure to tell me a bit about your business so that I can give you helpful feedback.

About Shai Atanelov
Before joining New Edge Design, Shai founded successful ecommerce stores of his own. At NED, he now helps clients with his expertise in ecommerce store solutions, marketing, SEO, and more.
This entry was posted in BigCommerce, Ecommerce, Open Source, Volusion. Bookmark the permalink.
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9 Responses to Should I Choose Open Source or Hosted Software for my Ecommerce Site?

  1. Shai,

    Hi there – you make a lot of great points regarding open source vs hosted ecommerce solutions and I agree wholeheartedly with the steps you follow to make a decision! I wanted to let you know about UpshotCommerce.Com. We’re an eighteen-year-old, hybrid SaaS ecommerce company that provides the ecommerce software solution for hundreds of retailers. We’re a fully customizable, on-demand solution with 99.99% uptime.

    I was in Israel with my family in January. Can’t wait to return.

    - Milanie

  2. Kristan says:

    Hi great article ! I have question regarding the data transfer limits on Volusion. The maximum rate is on the Platinum plan. This is 20gb per month. Is this enough for a busy ecommerce site or will I realistically get charged for going over the monthly allowance? If so I could get stung! Thanks Kris

    • Hi Kristan,

      Your question is a good one and we hear it asked many times. Most enterprise-level ecommerce stores may go over the 20GB bandwidth limit and get charged $5-$7 per GB of additional bandwidth usage. But it really depends on what information, images, and files are being presented on your website.

      There are some ways to reduce bandwidth usage on your site. They include hosting images and files on CDN networks (which can also help with page load time), hosting videos on 3rd party sites like Youtube, and making sure image files are compressed and optimized. Volusion also provides some good tips on how to effectively manage the administration section of the site to decrease bandwidth usage. Check out http://support.volusion.com/article/tips-limiting-your-volusion-stores-monthly-bandwidth-usage

      I hope this helps.

  3. Spot on..! Don’t underestimate the work of creating your own solution.

    I’ve also written a blog post about the same topic.

  4. Joris says:

    Hey Shai, as I freelancer building stores for clients I had to make the same choice over and over again. I decided to co-create a hosted solution and have written up an almost identical post a few months ago :) . We typically attract web designers that want to build stores for (smaller) clients that don’t have a dedicated programmer like you said. Feel free to check us out at http://www.solidshops.com

  5. Pingback: Quora

  6. Jason says:

    Hello,
    I am currently y with big commerce. I am happy there but am throwing around the idea of switching. I have decent visitors but not a lot of sales so I may be redesigning so I wanted to see what you thought stay where I am or what solution do you recommend. I sell educational toys for special needs children.
    Thanks

    • Naomi says:

      HI Jason,
      I’d like to hear more about the specific reasons you’re considering leaving Big Commerce and moving to Open Source. We work a lot with both and we’re not biased, so maybe we can give you some guidance about what step to take. Which platform are you now considering?

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