Cost to Build Supply Chain Management Software

Supply management software can assist your company in handling all the stakeholders involved in the supply chain, from suppliers and distributors to buyers. It can also decrease errors, save time, reduce cost, and improve overall efficiency. There are numerous off-the-shelf SCM software available at very low costs, but such software does not have features such as customization, scalability, and integration. For this reason, business leaders who prioritize long-term growth tend to invest in creating custom supply chain management software from scratch. Many of our clients have tried this off-the-shelf software, and they switched to building custom software for supply chain management because of dissatisfaction with that prebuilt software.

Building supply chain management software is a big decision for any business, and that’s why cost assessment is a necessary step. If you want to develop SCM software and need a realistic cost estimation, then this article is for you. Let’s see how much it costs to build supply chain management software.

Factors that Impact the Cost to Build Supply Chain Management Software

The cost of building supply chain management software can vary based on several important factors. At Bacancy, we’ve helped many clients navigate these variables to build efficient and cost-effective solutions. From features and customization to integrations and tech stack, each choice plays a big role in the final cost. Let’s explore the key elements that impact your investment.

1. Software Features and Functional Scope

The features you require in your supply chain software directly influence the cost. Simple functionality such as inventory management and order tracking is less expensive, but sophisticated features such as advanced analytics or demand forecasting are more costly because they require extra development and testing.

Cost Impact:
$8,000 – $15,000 for simple features
$18,000 – $25,000 for sophisticated features

2. Level of Customization

The more customized your software is to your own business requirements, the higher the cost. Standard software employs pre-built features, whereas custom workflows, reporting, and other customized aspects will take longer and more skills from the development team.

Cost Impact:
$1,500 – $3,000 for light customizations
$4,000 – $7,000 for deeper customizing

3. Number and Type of Integrations

Third-party system integrations such as CRMs, ERPs, or shipping systems contribute to complexity. Each system will have varying mapping and test requirements to allow data flow smoothly, which adds to both development time as well as cost.

Cost Impact:
$1,000 – $2,000 per integration
$3,000 – $5,000 for multiple integrations

4. Technology Stack Used

The choice of technology stack can also make a tremendous difference in development cost. More complex stacks like microservices or cloud-native stacks are more flexible and scalable but more expensive to develop and sustain compared to old-fashioned technologies like PHP or Node.js.

Cost Impact:
Simple stack: included in base cost
Advanced stack: +$2,000 – $4,000 for microservices or cloud-based stacks

5. Hosting and Deployment Setup

Cloud hosting is more economical for small businesses, with flexibility and lower installation costs. Nonetheless, on-premise options mean purchasing hardware and upkeep, thus rendering them considerably less cost-saving.

Cost Impact:
$500 – $1,500 for cloud hosting
$5,000+ for on-premise solutions

6. User Roles and Workflow Management

Configuring and customizing user roles is a must while developing supply chain software. Simple role assignment is easy and quick, but when you require access rights, approval workflows, or permissions to be customized across various departments, it would involve extra work and increase the price.

Cost Impact:
Included with simple roles
$1,500 – $3,000 with advanced role management and customized workflows

7. UI/UX Design Requirements

The UI/UX design quality impacts user adoption and software overall efficiency. A simple design can be quickly and affordably built, but if you require advanced features such as custom dashboards, mobile support, or user interactions, the price will increase because of the extra design and development effort involved.

Cost Impact:
$1,000 – $2,000 for simple design
$3,000 – $5,000 for custom, interactive design

8. Security and Compliance Requirements

Supply chain software tends to deal with sensitive information, so robust security controls are required. Simple encryption and login security might be enough for small businesses, but stronger security for compliance (e.g., GDPR or SOC2) increases both development time and expense because of the added layers of protection needed.

Cost Impact:
$1,000 – $2,000 for basic security
$3,000 – $5,000 for advanced security and compliance features

9. Scalability and Future Growth Readiness

Writing software with scalability enables you to manage future growth, e.g., more users, locations, or data. Although scaling initially increases development expense, it pays in the long term by not requiring future redesigns as your business grows.

Cost Impact:
$1,000 – $2,000 for minimal scalability
$2,500 – $4,000 for a rapidly expandable system

10. Location and Experience of Team

The expense of developing supply chain software is determined, from where do you hire software developers. Offshore or hybrid teams from countries like India cost less than local teams in the U.S. or Europe. Exalted experienced developers will cost more for their experience, which may be required for complicated tasks.

Cost Impact:
$80 – $150/hour for In-House (U.S./Europe) Developers:
$20 – $40/hour for offshore developers

Estimated Development Cost Breakdown by Feature & Complexity

Module / Feature	Complexity	Development Hours	Team Required	Estimated Cost (USD)
User Authentication & Roles	Low	60 – 100	Frontend + Backend Developer	$1,200 – $3,000
Inventory Management	Medium	120 – 160	Full-stack Dev + QA + PM	$2,400 – $4,800
Order Management	Medium	100 – 140	Backend Dev + QA	$2,000 – $4,200
Supplier/Vendor Management	Medium	100 – 140	Full-stack Dev + QA	$2,000 – $4,200
Demand Forecasting (AI/ML)	High	200 – 300	Data Scientist + Backend Dev + QA	$5,000 – $9,000
Warehouse Management System (WMS)	High	160 – 240	Full-stack Dev + QA + DevOps	$4,000 – $7,200
Shipping & Logistics Integration	Medium	120 – 160	Backend Dev + API Integration Expert	$2,400 – $4,800
Real-time Tracking (GPS/IoT)	High	150 – 200	IoT Dev + Mobile Dev + Backend Dev	$4,500 – $6,000
Reporting & Analytics Dashboard	Medium	100 – 140	Frontend Dev + Data Analyst + QA	$2,000 – $4,200
Integrations (ERP, CRM, etc.)	Varies	100 – 200	Integration Specialist + QA	$2,000 – $6,000
Cloud Hosting & DevOps Setup	Medium	60 – 100	DevOps Engineer	$1,200 – $3,000

Total Estimated Cost

Tips to Reduce the Cost of Building SCM Software

Building proprietary supply chain management (SCM) software can be costly, but with the correct method, it’s possible to minimize costs substantially without compromising quality. We help our clients with intelligent planning, the appropriate tools, and efficient development so that they can stay within their budget and still build solid, scalable solutions. You can also follow these tips to save money on your supply chain management software.

1. Define Clear Business Goals and Scope Early

Start with a well-defined scope that aligns with your business goals. Avoid scope creep by concentrating on the essentials, such as inventory management, order management, and supplier integration. This will maintain development time and cost within bounds.

2. Choose the Right Tech Stack

Employ cost-effective and scalable technologies such as Symfony for the backend and Vue.js for the front end. These open-source frameworks reduce licensing fees, speed up development, and offer strong community support.

3. Employ Modular and Reusable Elements

Implement your SCM software with a modular design. This enables you to reuse elements between various modules (e.g., warehouse, procurement, logistics), minimizing development time and maintenance expense.

4. Leverage Existing Tools Where Possible

Rather than creating everything from the ground up, integrate proven third-party APIs or tools (e.g., shipping, invoicing, or analytics). This speeds up development and reduces initial investment.

5. Outsource Wisely

Collaborate with seasoned software consulting companies that have SCM solution expertise. They can provide industry best practices and pre-existing solutions, lowering risk and cost.

6. Begin with an MVP

Create a Minimum Viable Product (MVP) to test essential features prior to scaling. This strategy reduces investment waste and enables you to adjust based on actual user feedback.