The world of technology is full of innovative software that is meant to make your business process easier. Businesses of all sizes and scales are willing to adopt newer ways to build the latest tech-powered business avenues. ‘Buy or Build’ is a common dilemma for many enterprises. 

From a business point of view, software applications are either ready-made apps or custom-made software applications. You can choose the software type as per the changing business needs. In this blog post, we will be diving deep into the core types of software, differentiating factors between ready-made apps (COTS) and custom-made applications, their advantages, and real-life applications.

1. What is COTS Software?

Definition of the popularly known as COTS: “Commercial off-the-shelf is any pre-built packaged software or an application that is made to address complex challenges of business through a single application.” Most commonly known commercial off-the-shelf applications or ready-made applications are the types where businesses can choose software apps that best fit their needs. 

For example, Adobe, and Microsoft are prime examples of COTS. The COTS components are ready to install, with little training & with the ability of cloud access and services of all software products. It is something available easily to the general public. Take a look at this quora answer.


COTS products must, in reality, be tailored to suit the needs of the enterprise and incorporated into current organizational structures. Extending the functionality of COTS products through custom production is also a choice, but because of the long-term service and maintenance consequences, this decision should be carefully considered.

The COTS provider accepts very few personalized features. So it presents its own collection of problems whenever there is an update in the COTS product. Apart from COTS products- there are other functionalities as well that we can add to the COTS application. With this, our goal is to make it versatile and scalable for better performance. In addition to COTS, there are other similar terms like:

  • MOTS - Modifiable off-the-shelf application is based on the same foundation of COTS but the only functionality change here is in source code that can be modified as per the business-specific needs.
  • GOTS - Government off-the-shelf application where the software is modified as per the government agency needs and will only be used by the public sector or government agencies.
  • NOTS - Niche Off-the-shelf application which is developed by NC3A which in general terms is made to meet niche market needs.

2. What is the Difference Between COTS and Custom Software?

When you have to choose between custom software applications and ready-made commercial off-the-shelf applications, the choice is quite simple.

By the statistics, it is quite clear that businesses around the world have a special inclination toward custom solutions. Custom software applications are preferred as they are a perfect fit and streamline normal tasks without much hassle. TatvaSoft can help businesses to create modern custom build applications. Below we have tried and enlisted all the possible parameters and the comparison table between the COTS and Custom software development that can be used as best practices for businesses to progress.

2.1 Comparison Table: COTS and Custom Software Application

ParametersCOTSCustom Software Application
Business FocusIt has a generalized aim to fulfill the generic needs of businesses.The design of custom software apps aim to cater to specific business needs effectively and timely.
Cost-effectivenessCOTS is not always economical. It is based on the technology chosen and implemented.Cost depends on what features the organizations want to imbibe in their software network. It justifies the whole cost structure.
Time FrameCOTS is Commercially available all the time and you can utilize it directly within a short period of time.The time for planning, development, and deployment is comparatively higher compared to others in the marketplace.
Free TrailsCOTS sometimes offers free trials and businesses can utilize those free trials to check whether the app works in favor of their business needs or not.The whole process involves continuous involvement of the business and hence they are free to trail anytime once the app is ready.
Rights ReservedThe software development company has all rights reserved for this ready-made public app. Also, in the case of licensing, we need to create one.You are the sole owner of the application and so you have all the rights to the data sources and the application.

With this, we have seen the major decision-making factors that make businesses choose between the two alternatives. These clear and crisp parameters are a kind of demonstration for organizations to know what would fit their business the best. Now, if still this doubt is not clear then let us delve deeper and see what are the benefits that commercial off-the-shelf software is capable of offering. Also, we take a view on the drawbacks of COTS and how they will affect your organization.

3. The Pros and Cons of COTS Software

Undoubtedly, software applications have become an integral part of all businesses, specifically IT-Information technology. All they did was confuse the available options were whether to buy or build. To clear this doubt, all you can do is understand the pros and cons of the COTS and then, understanding both aspects, take a decision.

So with the same thought process, here is a list of pros and cons of COTS that can be favorable for your organization. Given below are the benefits of COTS products.

Pros and Cons of COTS Software

3.1 Advantages of COTS Software

1. Reduced Purchase Cost

COTS offers your business a one-time investment that reduces the overall timely costs and the client has to pay only a good amount only during the time of purchase. COTS products have lower costs  as you don’t have to spend on hardware or infrastructure for faster results as compared to custom products. Commercial off-the-shelf software generally incurs lower life cycle costs. 

2. Larger Technical Assistance

Your peer companies are already using the available off-the-shelf software and hence there is a wide audience available in the market to share problems and ask for customer support and assistance. A specific community is assigned that solves challenges and gives a resolution.

3. Easily Deployable

You might need special skills to install the application or manage the operating systems but may not need to deploy it once it’s ready. COTS is a ready-made commercial application that can be used as soon as it is installed with specialized training and support.

4. Timely Upgrades

There are regular technology updates available from the company that has developed the application which can be easily managed and maintained effortlessly.

3.2 Disadvantages of COTS Software

All the advantages come with some other disadvantages. So if there are advantages of COTS software then there can be limitations too. While evaluating third-party vendors and companies before procurement, this question always gets stuck into the mind of business people on whether they should buy or build. Custom software apps are always a better way for seamless operations in businesses but why is it so can be logically justified by the disadvantages of COTS solutions. You can read more about the benefits of Bespoke Software Over COTS in this detailed blog.

1. No Competitive Edge

You use the same software that your compelling close business competitor does. So, there is no specific advantage that your business owns up to. No competitive edge, nothing.

2. Unknown Business Roadmap

Looking at the lucrative price structure, you might end up buying software with no certain roadmap. It can be a challenge to fit the application if not planned within your business ecosystem and get results from it.

3. Unnecessary Features

When you buy a ready-made public app, it has a lot of features. Out of which only some are useful and not all of them. So these extra features that you don’t use are a waste of money.

4. Higher Cost of Installation

You may not be self-sufficient all the time to install an application or software. You may need special skills to do that. Assistance from a supervisor will require you to pay for consultation or installation services which is an added charge to the budget. Sometimes you have to pay for training services also.


5. Additional Licensing Cost

Similarly, you will have to pay additional charges in case you want a licensed version of the software or the application.

6. Monotonous

The app purchased can only be used for designated roles and functions only. You cannot modify the available off-the-shelf app as per your business needs. It is designed to be used for specific business functions only.

4. What are Off-the-Shelf Software Examples?

Knowingly or unknowingly, we have been using substantial quantities of COTS apps for our daily operations. These applications have simplified our way of working and are an inevitable part of our work every day. Some of these applications are:

The Microsoft Office This includes everything from Microsoft Word, Excel, PowerPoint, One Note, Outlook, Access, and similar others.

Adobe PhotoshopThis application is specifically for designers and those creative art companies and agencies who are developing creative outputs daily.

Windows Operating SystemOne of the most sought-after users’ needs is a high-performing and scalable operating system without which most of the businesses wouldn’t be able to work as efficiently as they are doing now.

Apart from the obvious, there are some more COTS applications that we use on a daily basis such as Norton Antivirus, TurboTax, SAP, Oracle, Intergraph SmartPlant, OmniPlan, and OmniOutliner.

5. Steps to implement (COTS) Commercial-Off-the-Shelf Software

You need to adopt a strategic approach for the effective implementation of COTS software in your business operations. It helps you make sure that a COTS solution can meet your organizational requirements. You need to follow the steps discussed below:

5.1 Identify Your Needs

Without having clarity on your business requirements, you wouldn’t be able to discern the right fit from a bad one. It is also important to understand what functionalities your COTS software solution must have to fulfill your requirements. You have to factor in your objectives, the nature of operations, and the scale of their implementation. 

5.2 Research and Selection

After determining your requirements, it’s time to research the options available in the commercial

marketplace  that can help you fulfill those requirements. You have to check out their costs, features, compatibility, and scalability along with the reputation of the developer. 

Feel free to reach out to your peers or vendor’s previous clients for recommendations and feedback. This research will help you shortlist options with proven track records. Now, you can try out the demons of these shortlisted options to get some hands-on experience. 

You can discuss your experience or get a consultation from the stakeholders and team members who are going to use the software. Their valuable feedback and insights can help you make an informed decision about picking the COTS product that suits your needs and fits your budget. 

5.3 Licensing

Now that you have decided on the software, it’s time to procure it. For that, you have to be aware of its software licensing terms and conditions. You also have to find out if there are any limitations or usage restrictions. 

One thing that matters the most is to ensure that your organizational needs and policies align with the licensing agreement. If everything goes well, then all you need to do is make payments to acquire the license so that you can use the software legally. 

5.4 Training and Integration

Before organization-wide implementation, you have to run a pilot test to check off-the-shelf software for potential errors and improvement. You have to train the staff on using the software and its functionalities. You have to offer them the necessary support and resources. 

Additionally, you have to ensure that the COTS software integrates with your systems smoothly. If you are currently using some other tools or softwares then you have to check the compatibility of the COTS solution with them as well. Test the integration for smooth interoperability and data flow between systems and ensure that it doesn’t disturb your operations. 

5.5 Support and Maintenance

Before shopping for the software, ensure that the COTs vendor offers technical support and maintenance services. The contracts will have provisions about support services. After all, you don’t want your vendor to charge you fees every time you have to upgrade or reinstall it on different devices. 

Monitor off-the-shelf software performance to improve productivity, reduce downtime, and address other issues. Also, stay updated on the new features, patches, or updates released by the vendor. 

6. To Sum Up

One of the pioneering Research companies- Gartner researched custom software development and the results say that the Custom software development services have grown to a market size of $70 billion and have been continuously growing at 5% per year. This research identifies the service providers in this fragmented market and analyzes how some can grow at over 20% per year. The statistics are very clear that the adoption of custom-built software apps is just skyrocketing. Through this blog, we are hopeful that we have enlightened you on the importance of Custom software applications and made a clear differentiation on what benefits COTS solutions can offer. Our focus is just to showcase all the points that will help decide to utilize the application that is high-performing, scalable, and profitable.

Frequently Asked Questions:

What are examples of COTS software?

Some examples of commercial off-the-shelf software are Microsoft Office Suite, Adobe Creative Suite, Salesforce, AutoCAD, and Zoom. 

What does COTS do?

COTS is ready-to-use software that caters to the needs of a broad audience. It can be an operating system, email programs, office productivity suites, and more.  

Itesh Sharma

Itesh Sharma is core member of Sales Department at TatvaSoft. He has got more than 6 years of experience in handling the task related to Customer Management and Project Management. Apart from his profession he also has keen interest in sharing the insight on different methodologies of software development.


  • Leave a message...

    1. Larry Zin

      COTS is mass-produced hence they are relatively low cost. They are very cost-effective & beneficial for small businesses. If your needs change frequently then COTS can disappoint you.

    2. Avinash

      COTS can deliver effective results when your needs are urgent and absolute straight-forward requirements. But for growing business, it is challenging to pace up with commercial apps.