Exploring the World of SaaS Software Development: Best Practices and Considerations

When an organization is established, the primary goal is to gain immense growth as quickly as possible. With that in mind, several actions are taken to promote organizational growth. Software-as-a-Service is gaining traction in the industry and is implemented by legions of global organizations for overall expansion and growth. When you have existing software, you can transform it into a SaaS application. Also, you can get a SaaS software development service to begin developing it from scratch.  

Getting a SaaS software development service significantly affects how the software performs. One of the most significant importance is the security it offers to the organization. SaaS providers implement numerous security layers and features, ensuring it remains secure. Apart from that, SaaS applications do not require installation, eradicating the additional efforts and making the app faster. One major factor that helps SaaS apps in organizational growth is the scalability they offer. It can be scaled up or down depending on the company’s requirements. 

This is a brief on how SaaS apps are excellent for organizations. This article explains several factors about SaaS applications, including their benefits, types, examples, cost, and the process of developing a SaaS application. But before going further lets deep dive into some insights about SaaS software development.

SaaS Software Development: Best Practices and Considerations

Here are some data and insights about SaaS software development:

  1. According to a report by Statista, the global SaaS market size is projected to reach over $220 billion by 2022, up from $94.8 billion in 2019.
  2. The same report predicts that the fastest-growing segment within the SaaS market is expected to be CRM (customer relationship management) software, with a compound annual growth rate of 14.2% from 2019 to 2022.
  3. Another report by Gartner predicts that by 2025, 85% of new software will be delivered as SaaS.
  4. The most commonly used programming languages for SaaS development are Java, Python, Ruby on Rails, and PHP, according to a report by Skyhigh Networks.
  5. A survey by the cloud infrastructure company DigitalOcean found that 53% of developers prefer to use cloud services for their SaaS application development needs, while 43% prefer to use on-premise infrastructure.
  6. The same survey also found that the top challenges faced by developers in SaaS software development are security (50%), scaling (47%), and integrating with existing systems (36%).
  7. According to a report by PwC, SaaS companies spend an average of 17% of their revenue on research and development, compared to an average of 12% for other software companies.

What is SaaS Software Development?

SaaS is a type of cloud computing that provides a cloud application to users through the Internet. Such apps are suitable for organizations that want to avoid the hassle of maintaining infrastructure and platforms. SaaS software development is the process of building cloud-based applications efficiently.

The process includes various development phases, including documentation, development, testing, and deployment. However, the phases should be customized per the project requirements and the software. 

Benefits of SaaS Software Development

The usage of SaaS software is increasing swiftly due to the upfront benefits it offers to the organization and software users. Before moving forward, it is essential to understand the perks of SaaS software. 

  • Accessibility: A traditional application must be downloaded on the device, and compatibility is crucial in accessing the app. As SaaS software requires an internet connection and a web browser, accessibility is never an issue. Such apps can be accessed anytime and anywhere without any setup.
  • Limited Hardware Requirements: SaaS applications run on cloud or remote servers, which means that they eliminate the need for complex hardware. The time and effort used to maintain traditional software are eradicated with minimal hardware requirements. 
  • Lower Costs: Operating costs come with every software type. However, in the case of SaaS software, these operating costs are minimal as the need to maintain hardware infrastructure is removed. 
  • Scalability: Organizations tend to grow with time, leading to increased overall requirements from the software. SaaS software can be scaled whenever required depending on the organization’s requirements. 

Examples of SaaS Applications

Legions of SaaS applications currently exist in the market and cater to different types of organizations per their requirements. Some of the most popular SaaS applications are mentioned below:

  • Project Management SaaS Software: Trello, Basecamp, and Asana are the leading project management SaaS software.
  • Email Marketing: For email marketing, Mailchimp, Campaign Monitor, and Constant Contact are the top names.
  •  Video Conferencing: Since the pandemic erupted, names like Zoom, Microsoft Teams, and Google Meet have become highly popular for video conferencing.
  • Customer Relationship Management Software: The most prominent examples of CRM SaaS software are Zoho, Salesforce, and Hubspot.

Difference between SaaS Software Development and Traditional Software Development

SaaS software development and traditional software development come with several dissimilarities. As mentioned above, SaaS software development includes creating cloud-based software that can be accessed online.

However, traditional software development is building software that will be installed on the user’s devices. Some other differences between the two are elaborated on below:

FactorSaaS Software DevelopmentTraditional Software Development
1. DeploymentSaaS software is deployed on cloud infrastructure, making it accessible on the internet.Traditional software should be installed on the user’s software locally.
2.IntegrationSaaS programs are developed in a way that allows them to be integrated with other cloud-based applications on the go.Traditional software may require additional integration software to collaborate with different programs.
3.MonetizationMost SaaS apps are either free or run on a subscription-based model.Most of the traditional software provides a one-time license for a specific fee.
4.UpdatesThe service provider can provide updates, and the user does not need to perform any action.To get the latest version of traditional software, the user has to download and install the update patch on their device.

How is SaaS Software Developed?

Developing SaaS software requires a systematic approach to ensure its effectiveness in the long run. Let’s dig deeper into the development process to understand how a SaaS application is made for the masses.

Step 1: Planning– Before working on the actual development of the SaaS application, you must understand what you want to achieve with the software. In this phase, your development team will identify the problem that your SaaS app will solve. Furthermore, a study on the target audience will be conducted to understand their needs and expectations. 

Based on this information, the features will be added to the SaaS application, and the monetization model will be determined. Furthermore, the budget, timeline, and resource allocation will also be performed in this phase. 

Step 2: Designing– Once the planning is complete, the next step in the Software-as-a-Service development process is to create its design. The design phase includes creating the SaaS software\’s user experience and user interface design. For the best outcome, it is essential to develop a clear and intuitive user interface that makes it easier for the user to use the software. 

Step 3: Development– As the name suggests, this is where the actual development of the SaaS software will occur. The information from the steps above will be utilized to create an effective and useful SaaS program for the users. An entire development process is a collaborative approach where all the team members work together to build the software.

For instance, the backend and frontend developers will write the code, deploy the design, and connect the frontend to the backend. Similarly, all the different personnel will perform their roles in building the program. 

The goal is to build as stable SaaS software as possible with all the intended features, design elements, and integrations determined in the previous stages. 

Step 4: Testing– Testing is one of the most crucial steps in the entire SaaS web application development process. The reason so much emphasis is given to this step is that it is directly responsible for the success or failure of the software. To understand it clearly, assume that you planned to add a revolutionary feature to the software and had the utmost confidence in the development process that the feature would work as anticipated. However, after releasing the product, the most valuable feature of your software needs to be fixed. Not only will it cost extra to fix it, but it will ruin your users’ entire trust. 

Testing your product can save your SaaS software from all of this. Performing functional and non-functional testing is essential to ensure your software works as anticipated and that all the visual elements are placed perfectly. 

Step 5: Deployment– The entire development process is performed to deploy the application for the users. This step launches the created and tested application in a production environment. The team will set up the cloud infrastructure and configure the SaaS application for production. 

Step 6: Maintenance and Scaling– The development process does not end at deployment. There are stances when specific issues seep through testing and reach the outcome. Users report such issues to the development team. This is the phase where maintenance comes into play. The reported issues should be fixed soon so users can utilize the software. It is essential to keep a hefty maintenance budget, or else it could be troublesome for the team to fix the issue in minimal time.

With the rising competition and ever-changing needs of users, SaaS software should always be ready for scaling. As soon as the product is released, the team should begin working on new features to retain the users while giving them something unique. 

Key Considerations during SaaS Software Development

Before moving forward with the development process, it is crucial to know certain factors that influence the final decision on the inclusions in your SaaS application. Considering that fact, the following are the key considerations during SaaS software development.

  • Target Market: One of the first things to consider in SaaS software development is the target market. All the features and UI/UX should be created per the market analysis to ensure the utmost usage. An in-depth market analysis should be performed to ensure the SaaS application can capture the market as expected.
  • Database: The database selected should be based on the business type and needs. Picking any random database may get the job done, but it will not be as flexible in the long run as the one explicitly suited for your organization. Consider scalability, language, budget, and data type before picking a database for SaaS software.
  • Integrations: Seamless third-party integrations are among the top reasons for choosing SaaS programs. However, the integrations should be determined before developing SaaS software to leverage this benefit. 
  • Monetization Model: A clear idea of your monetization model will help the outcome. Researching the target audience and the type of SaaS software before picking the suitable monetization model will help scale. 
  • Scalability: If a SaaS application offers excellent features, it is bound to grow exponentially. Every SaaS platform development should involve scalability. Both horizontal and vertical scalability should never be an issue, as the number of users and their demands will only grow with time. Keeping scalability in the process can be a significant problem for the application.
  • Security: Every renowned SaaS software has data of legions of users. As such software is accessed through the internet, it is a potential target for attackers to steal confidential data. Considering that fact, robust security practices like strong authentication, data encryption, and regular testing should be considered for implementation in the program.  
  • User Experience: User experience directly impacts user retention, adoption, and satisfaction with the SaaS application. The user experience should be based on the target audience and the competitors. With the right market fit, the user experience will make the SaaS software intuitive, easy to use, and meet the users’ expectations. 

Technology Stack to be Used in the SaaS Software Development Process

The right technology stack is essential for an effective SaaS software development process. Several technological components are in the development process, and all should be considered for the most suitable tech stack.

  • Programming Language: Picking the correct programming language directly influences the time and resource consumption, budget, and features you add to the app. The most popular front-end programming language is React, with features like client-side development, reusability, and React virtual DOM, among others. Other alternatives to React are Go, Java, and Node.js.
    Python is considered the top programming language for backend development because it has a robust ecosystem, MI/AI integration, and stability. However, Node.js and Java can also be suitable if you want to use some other language, then Node.js and Java can also be suitable.
  • Framework: The framework you pick will vary with the language you pick. If you go with Python, you have two options: Django and Flask. Depending on the project requirements, you can go with either of the frameworks.
    Apart from that, React, Angular, and Vue.js are also renowned SaaS software development frameworks. React is a JavaScript library offering a declarative approach to building complex UIs, and Vue.js is a progressive framework popular for its ease of use and top-notch performance in creating SaaS applications. Angular is a web application framework based on TypeScript, far-famed for creating dynamic web applications. 
  • Cloud Provider: As SaaS apps are cloud-based, you need a reliable cloud provider to host your SaaS application. Amazon Web Services is the top-name as cloud provider for SaaS applications. But you can also go with Google Cloud Platform and Microsoft Azure.
  • Microservice Architecture: Currently, most SaaS apps have a microservice architecture as it is more effective. For microservice architecture, you primarily have two options; Docker and Kubernetes. 
  • Database: A database is considered a repository to store and manage data created and used by the SaaS application. The database stores and manages sensitive data such as transactional information, user details, configurations, etc. MySQL, MongoDB, and PostgreSQL are the top preference for SaaS application databases.

Role of SaaS Software Developers in the Process:

SaaS software development is not a one-person job but the hard work of an entire team. Each team member is assigned specific tasks which they should achieve to create the right SaaS software. The following are the top roles that should be there in a SaaS development team.

  • Project Manager: This is the crucial person in the development process who will handle the planning and ensure the process goes as planned. The project manager will assign the tasks, take all the measures to meet the deadlines and fulfil all the project requirements.
  • UI/UX Designer: The UI/UX designer will design the application’s user experience and interface and ensure it aligns with the target audience. 
  • Front-end Developer: Front-end developers will focus on the user’s side of the application, where their primary role is to turn designs into code.
  • Back-end Developer: Using the selected programming language, the back-end developer will focus on the app’s server side to ensure it functions as planned.
  • QA Engineer: The QA engineer will perform numerous tests on the SaaS software to identify issues and bugs. Once identified, the QA engineer will also report the issues to the developers for fixing.
  • Business Analyst: The business analyst will evaluate the market potential of the software to identify the most suitable business model.

Common Types of SaaS Software

During the planning stage, you will determine the type of SaaS software that will fit your target audience. The following are the common types of SaaS software and their examples

  • Enterprise Resource Planning Software: ERP software helps organizations handle day-to-day business tasks, including risk management, procurement, and supply chain management. Top examples of SaaS ERP solutions include Oracle NetSuite, Sage Intacct, and Microsoft Dynamic 365. 
    SaaS ERP can provide benefits like seamless data sharing, faster deployment, access to modern tools, and saving money. However, integration challenges, vendor lock-in, lack of security, and data ownership issues are some limitations of this SaaS software type.
  • Customer Relationship Management (CRM): With the right CRM software, organizations can effectively manage customer data, automate sales, and track customer interactions. Salesforce, Zoho, and HubSpot are the top names in SaaS CRM software. 
    With CRM software, you will provide enhanced customer experience, better sales, effective marketing, and improved overall customer management. The biggest drawbacks of SaaS CRM software are the possibility of data breaches and the loss of crucial customer data. 
  • Project Management Software: Teams working on different projects can use SaaS-based project management software like Trello, Basecamp, and Asana. With such programs, teams can collaborate effectively, manage tasks, and track progress. 
    Moreover, teams can expect benefits like better project tracking, enhanced communication, and better project visibility. On the other hand, limitations like slower speed, the possibility of a data breach, and dependency on the internet also exist in SaaS project management software.
  • Accounting Software: Managing financial books is necessary for an organization to track expenses and income, track all other financial transactions, and generate reports based on transactions. These tasks are made easier with SaaS accounting software such as QuickBooks, Xero, and FreshBooks.
    Enhanced financial reporting accuracy and transparency in financial management are some benefits of SaaS accounting software. However, lack of control and limited connectivity are drawbacks that also come with this software. 
  • Human Resource Management: Every organization has a human resource department where they need to perform tasks like payroll processing, recruiting, employee management, and many others. Such tasks can be performed effectively with HRM SaaS software such as Gusto, Workday, and BambooHR.
    With HRM SaaS software, you can leverage the benefits like cost-effectiveness, and automated processes, saving significant time. However, limited integration and customization in off-the-shelf HRM solutions can be a drawback with such programs.
  • Communication and Collaboration: As the world embraces remote working, communication, and collaboration, SaaS software is rising. Tools like Zoom, Microsoft Teams, and Slack help teams work together effectively without geographical barriers.
    Improved team collaboration and seamless scalability are why communication and collaboration SaaS software are in demand. However, technical challenges like limited performance and unexpected downtime can be a limitation here.

Cost of Developing a SaaS Software

Budget is among the most significant factors that influence the outcome of the SaaS software. Before finalizing the budget, knowing the average cost of developing a SaaS software, the factors influencing the cost, and how to minimize the cost helps in the long run. 

The average cost of building SaaS software is between $50,000 and $150,000. However, numerous factors affect the overall cost of building this software type. The following are the factors that contribute to the cost.

  • Complexity: As the name suggests, complexity is when the team puts in additional effort to build the software. Factors like data security, payment integration, scalability, features, and customization, among others, contribute to increasing the complexity. The more complex the development process becomes, the higher the development cost. 
  • Type of SaaS Software: Different types of SaaS software are available with unique features and market fit. However, the development cost of every SaaS software type is different. For instance, accounting and CRM software is less expensive than ERP solutions. 
  • Infrastructure Cost: Infrastructure cost is among the most significant expenses in SaaS software development, especially for small and medium enterprises. It involves the cost of configuring and maintaining the required hardware, network, and software to develop and run SaaS software. The infrastructure cost of SaaS software will vary with the resource requirements and scale of the application.
  • Testing and QA: Every organization should have a hefty budget for testing and QA as it helps eradicate major issues and stabilize the software. The rule of thumb is to allocate thirty percent of the total budget to testing and QA. However, it varies with the project requirements.
  • Development Team: The cost of a development team depends on the type of team you hire for the project. Most organizations either go with an in-house team or outsource the process. Among the two, the most cost-effective and efficient option is outsourcing the process.
  • Miscellaneous Costs: Many organizations must consider the miscellaneous costs involved in the development process. To avoid surprise expenses, marketing, maintenance, updates, compliances, and customer support should also be considered. 

These were the top factors that affected the cost of developing SaaS software. Remember that actual factors may vary with the project and its requirements. It is always best to connect with a professional SaaS application development company for detailed cost information.

Tips to Minimize SaaS Software Development Cost

Every organization wants to save its development budget to invest the money for overall growth. Saving money in SaaS development is also possible with the right decisions. The following are the tips that will help you in minimizing development costs.

  • Focus on Planning: One tip that has saved millions of dollars for organizations in SaaS development is focusing on planning. The more you plan, the more sorted your development process will be, resulting in fewer surprise expenses. Moreover, you will have defined requirements, allowing you to cover all the expenses beforehand.
  • Communication and Collaboration with Team: Ensure effective communication with the development team by arranging frequent meetings. Doing so will ensure that the project remains on time, issues are addressed and resolved quickly, and delivered without delays.
  • Optimum Testing: After release, the biggest expense of SaaS software is maintaining it and fixing the issues. Fixing issues after release is highly expensive compared to fixing them before release. Optimum testing ensures that this expense is eradicated, saving the overall cost of SaaS software development.
  • Outsource Development Process: Regarding SaaS software development, the most cost-effective option is to outsource the process to a dedicated company offering SaaS application development services rather than having an in-house team. These agencies are both cost-efficient and provide high-end services, ensuring your SaaS product is made with the utmost expertise. 
  • Utilize Open-Source Technologies: Open-source technologies are free to use and offer excellent features necessary for SaaS software development. Using premium licenses for such technologies can consume a major chunk of the development budget, so it is often recommended to use open-source technologies to save costs. These flexible tools and technologies have lower costs and come with community support to resolve most issues quickly.

Choosing the Right SaaS Development Vendor/Partner

When you’ve decided to outsource the SaaS development process, the next part is finding a vendor to bring your SaaS software idea to reality. The right vendor will help you in every phase, planning or maintaining. Keep in mind that the entire outcome depends on the vendor you choose. With that in mind, here are the key considerations you should know when picking the right SaaS development company.

  • Security: Your SaaS solution will most likely store confidential data. Make sure you pick a vendor who prioritizes security and has implemented several security layers to prevent data breaches. Having several security compliances is also an additional benefit.
  • Technical Expertise and Experience: A rule of thumb is that a highly experienced SaaS software development company is more likely to provide better services. However, along with their experience, it is crucial to identify their technical expertise. The development company should be proficient in the technologies you want to use in your SaaS application.
  • Scalability: As your SaaS app comes with new features, it is more likely to grow and grab the attention of more users. With rising users, your app should scale per the requirements. Ensure the SaaS product development company can build a scalable solution for your growing organization. 
  • Support: Once the development is complete, it is time to maintain the software. The development company should provide around-the-clock support to fix any reported issue immediately.  
  • Pricing: The vendor will provide the approximate cost depending on the complexity and other factors. However, different vendors will give different quotations. You need to pick the one that fits your budget while providing the functionalities you want in a vendor.

SaaS Development Models

One of the most prominent decisions in SaaS software development is to pick the right development model. There are mainly three SaaS development models; Public, Private, and Hybrid. The following section explains these SaaS development models and their dissimilarities, benefits, and limitations so you can pick the one per your requirements.

  • Public SaaS: One of the most common SaaS development models is public SaaS. Here your SaaS software will be hosted on a third-party server and made available to the public through the Internet. In most cases, the resources will be shared with other tenants on the cloud architecture in a public cloud.
    • The following are the benefits that you will get when you go for a public SaaS development model:
      • Cost-effective solution.
      • Easily scalable.
      • Seamless deployment.
      • Resource sharing may lead to a potential data breach.
      • Limited control over the software.
      • Lack of customization.
      • Limited Integration with third-party programs.
      • No need for infrastructure maintenance.
    • However, specific limitations should be addressed before you finalize public SaaS.
      • Resource sharing may lead to a potential data breach.
      • Limited control over the software.
      • Lack of customization.
      • Limited Integration with third-party programs.
  • Private SaaS: Private SaaS is the opposite of public SaaS, as the software will be hosted on a private server rather than a public. In most cases, it will be available for limited users, but it varies with the nature and purpose of the software. The resources are not shared with any other tenant in private SaaS. Furthermore, it provides maximum control over the software, making it a preferred SaaS development model for enterprises. 
    • With this SaaS development model, you can get the following benefits:
      • Enhanced security.
      • Better Customization.
      • Seamless third-party Integration.
      • Utmost control over SaaS software.
    • On the other hand, you should also be aware of the following limitations of private SaaS.
      • Expensive deployment.
      • Need to maintain infrastructure.
      • Scalability is complex.
      • Difficult to deploy.
  • Hybrid SaaS: Hybrid SaaS is the best of the aforementioned development models, where the SaaS software will be hosted on a private and a public server. With this model, you can leverage the benefits of the private cloud while being easy on the pocket. You can switch between private and public SaaS as required in hybrid SaaS. 
    • Here are the top benefits that you will get with a hybrid SaaS development model:
      • Cost-effective.
      • Highly scalable.
      • Better control over data.
      • Enhanced security.
    • Make sure to consider the following drawbacks of the hybrid SaaS to make the right choice.
      • Complex deployment.
      • Difficult to integrate with third-party programs.


The details above elaborate on SaaS software development, including its significance, types, development process, cost of development, suitable model, and factors in picking the right vendor. With this information, you can determine whether you should use SaaS software for your organization.

SaaS software development comes with legions of benefits for the organization. Even though there are certain limitations, they can be overlooked when the benefits are utilized. Moreover, the best method of building SaaS software is by outsourcing as it is easier, cost-effective, ensures success, and is time-saving. 

To get a SaaS development, you must be looking for a renowned SaaS software development company. ThinkSys is one of the leading names in offering SaaS software development services to numerous organizations in the US. Offering SaaS software development and QA services since 2012, ThinkSys will surely understand your needs and expectations from SaaS software and thrives on delivering the software you always wanted.

Whether it is a SaaS web application or a mobile application development, the professionals at ThinkSys are proficient in building the SaaS app you and your users will love.


How is SaaS Different from a Web Application?

Both SaaS software and web apps can be accessed through the internet using a web browser. Due to this similarity, many users often confuse SaaS with web apps and vice-versa. With that in mind, here is a quick comparison between the two.

1.Functionality: SaaS programs are created to provide specific features depending on the market fit. Types of SaaS apps include CRM, accounting, HRM, and ERP. However, web apps offer numerous features varying with the app’s complexity.

2.Pricing: Most SaaS programs follow a subscription model for their services. On the other hand, most web apps are free to use or may come with a one-time fee.

3. Customization Options: Web applications are known to be highly customizable by users. Even though SaaS software is customizable, the customization options are limited compared to web apps.

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