MDM cost comparison: when to build and when to buy
Every organization with a fleet of kiosks, points of sale, or other dedicated devices has to consider whether to build its device infrastructure from scratch or buy it.
Building gives you control but adds the complexities of designing and maintaining your infrastructure long-term. Buying is often simpler and cheaper in the longer term, but can feel like finding a needle in a haystack — a widely-available solution with the flexibility to meet your needs.
Things to consider when building a fleet from scratch
Building and maintaining a custom infrastructure for kiosk, point of sale, and other dedicated devices is a big undertaking. Don’t try to fool yourself here: it’s not easy. It’s costly, time consuming, and requires significant setup on the front end. But once it’s done? You get full control and ownership of your devices. Here are things to consider before deciding to build.
- Developers’ time and salary: Building a new product will require fully burdening multiple developers for at least six months minimum. The number of developers and how long they’re unable to work on other projects will depend on various factors such as skill and the fleet size you’re looking to build. Don’t underestimate how long it will take or the resources that will be required. Similarly, don’t hire the bare minimum to get the project off the ground. Depending on one developer could leave you in a bad place if that person decides to leave.
- Lost productivity: With your development team committed to building your device fleet, that means they won’t be readily available for other revenue-generating activities. When something goes wrong, this can result in major business disruptions.
- Server costs: Servers are required when choosing to build. And you’re guaranteed to pay more when you buy it on your own since you don’t benefit from the same economies of scale true infrastructure providers do.
- Compliance certifications: Devices in regulated industries, such as finance or healthcare, that handle sensitive customer information won’t get very far without certifications. Certifications will add additional costs, overhead, and time to the build process.
- Lost revenue from device downtime: Consider all the losses that come into play when a device goes down: lost profit, cost to repair, and operational costs are the bare minimum.
- Fallout from poor CX: Customer experiences are the most important factor for a dedicated device fleet, so poor management of fleet assets can be disastrous. When your devices are designed to be the frontline, you can’t afford to mismanage them.
- Management overhead: Device fleet management doesn’t stop once you build it — you have to update it, continue innovating, and further invest in a continuous management strategy. Your dedicated devices should be a core component of your business, so you’ll need the bandwidth to treat them as such.
As you can see, there are several pitfalls to avoid when choosing to build your device fleet — but the flexibility and freedom you get from your own management solution might be worth it to some. For everyone else? Let’s talk about buying.
Things to consider when buying off the shelf
While building is a big undertaking, buying device infrastructure can be a compelling option. It’s more affordable on the front end and can ease the burden of deploying and maintaining your fleet. You’ll spend more time upfront researching options to find a quality solution that fits your needs, but after that, the upkeep is relatively low. Here are the relatively few things that you’ll need to consider when buying an infrastructure.
- Device licenses: The main cost of buying is device licenses. Usually, this is priced per device per month, and the size of your fleet will be the deciding cost factor.
- IT support: Adding a new platform to your IT stack will mean oversight from your IT team. Someone has to qualify the technology, learn how it works, and ensure it will integrate properly. If your IT team is already overburdened, this can mean expanding to add more people. Still, you’ll likely find that the time your IT team has to spend learning and implementing a solution is worth the long-term freedom of outsourcing your device infrastructure over building custom.
As you can see, there’s little in the way of extra work when it comes to buying versus building.
Cost comparison: building vs. buying
To put things into perspective, here’s a quick look at how much you’d spend to build device infrastructure for 100, 5,000, and 50,000 devices. Of course, you may think we’re biased since we build infrastructure for a living. But given our experience in this field, these numbers are far from unrealistic.
|Item||Notes||100 devices||5,000 devices||50,000 devices|
|Developers||Full-time 1-yr salary for total number of developers you’ll need. Avg cost based on $200K per year salary for a full stack developer.|
If your developers aren’t full stack, you’ll need 3-4 minimum to start (front-end, back-end, and SRE). You’ll also need a QE if these developers aren’t also testing the code they’re writing.
|Lost productivity||Lost revenue from allocating your developers’ time to building your fleet.||$300K||$600K||$2.5M|
|Servers||Total cost for your entire fleet per year. Avg cost based on AWS pricing.||$2.4K||$250K||$1.2M|
|Certifications||Device certifications required based on your industry. Avg cost is based on Infosec, but can be much higher in regulated industries.||$50K||$50K||$50K|
|Lost revenue from device downtime||Revenue left uncaptured due to device breakage||$50K||$250K||$2.5M|
|Fallout from poor brand experience||Customer and/or brand fallout from poor experiences||$50K||$250K||$2.5M|
|Management overhead||Project management and overhead for continuous improvement of device performance.|
For 50K devices, not only does the cost increase, development of new features at this scale means a ton of data and requires a completely different platform architecture.
|Device licenses||Total cost of an entire fleet per year. Avg cost based on Esper pricing.||$7.2K||$360K||$3.6M|
Buying, however? Considering you won’t have to pay for developers, lost productivity, servers, certifications, lost revenue, fallout from device failure, or management overhead, well, you’ll save quite a bit. The total price for a 100 device fleet is just $7,200 (vs $604,800). A 5,000 device fleet comes in at $360,000 (vs $2,060,000) and a 50,000 device fleet infrastructure will set you back $3.6m (vs. $14.8m).
So yeah, we know what makes the most sense to us. Give us a call when you see it, too.
What are the benefits of building a device infrastructure?
It’s more customizable since you’ll have full control of the entire system.
What are the downsides of building a device infrastructure?
Cost, time, and upkeep. It’s very expensive to get started, takes significant time investment, and is both costly and time consuming to maintain.
What are the benefits and drawbacks of buying a device infrastructure?
The pros are vast: simpler maintenance, more cost effective, and improved flexibility. The primary drawback is finding the service that works best for your needs — it can be quite challenging.
What do Walmart, Sam’s, Target, and other big retailers use for device management?
The big guys usually have the time and money to throw at a custom solution — and back when they invested in this system, it was likely necessary. But now, there are other options that offer nearly the same customization and flexibility required by even the largest of companies. Both large and small organizations can benefit from buying now.
Image source: Andrey Suslov/Shutterstock.com