There are over 30,000 SaaS companies worldwide, and over 60% of those are in the US alone. With thousands of software options to choose from, it’s easy to see why small businesses make the same common software selection mistakes that cost money, time, and wasted opportunities.
In this post, we’ll highlight the top ten mistakes SMBs make when choosing software—and, more importantly, how to avoid them. Whether you’re exploring software solutions for the first time or upgrading existing tools, this guide will help you make smart decisions ready for the new year.
Top 10 Software Selection Mistakes Small Business Owners Need to Avoid
1. Lack of Clear Goals and Requirements
Any new software investment should solve a specific problem within your business. If you’re buying software for the sake of having the latest tool or platform, it won’t get a significant ROI.
The most common software selection mistake we see SMBs make is failing to define the specific problem they want software to solve. This quickly leads to adopting solutions that either underperform or are over-engineered for their needs.
2. Overlooking Scalability
The next common software mistake to avoid is forgetting about scalability. If you currently have a professional services business with ten high-value clients, you should look for software solutions that can easily handle double that capacity.
Selecting software that cannot grow with your business means you’ll be looking for replacements or upgrades as soon as your company begins growing, which is wasted time and money.
3. Ignoring Integration Needs
It’s frustrating to find a perfect software solution only to discover it doesn’t integrate with an existing system. Don’t fall into the common trap of investing in it anyway and looking for a workaround.
Custom integrations can be expensive and time-consuming. Plus, if you can’t find a solution, you’ll be left with data silos and business-killing inefficiencies – that’s an expensive software selection mistake to make!
4. Focusing Solely on Price
While budget constraints are important, choosing the cheapest software option often leads to sacrificing functionality, usability, or long-term value.
At StackPlan, we strongly advocate creating a structured technology roadmap budget before exploring new software options. But don’t forget to factor in the lifetime value when choosing software. Is it worth investing more now to have efficient, ROI-driven processes long into the future?
5. Skipping Trial Periods
An all-too-common software mistake we see is SMBs skipping the free trial period because they’re happy with how the software looks on the vendor’s website.
Trial periods are critical for understanding how the software works in a real-world context and give you a clear idea of how much training your team will need.
Don’t forget that vendors do all they can to market their software in the best possible light. Although their platform might look perfect, you’ll never know if it’s the right fit until you test out a demo or trial period.
6. Neglecting Employee Input
Team members who use the software daily have the most valuable insights about necessary features, current limitations, and futureproofing strategies, yet they’re often ignored in the software implementation process.
Ignoring employee input can result in poor adoption rates, especially if you’ve chosen inefficient or mismatched tools. The more involved your team feels in the adoption process, the more successful your launch will be.
7. Overlooking Training and Support
Small business owners sometimes underestimate the learning curve and need for user support. Just because a software solution seems intuitive or user-friendly doesn’t mean your team won’t need training to get the most out of the features on offer.
Even if support is included in the price of software, don’t make the mistake of assuming it’s adequate. Get a detailed breakdown from your vendor to ensure your team is fully supported throughout the implementation.
8. Misjudging Total Cost of Ownership
Don’t be fooled by the sticker price on new software – promotions are a great cost-saver, but they don’t show the full cost of ownership.
When planning your budget, don’t overlook hidden software costs such as implementation fees, subscription renewals, customizations, and ongoing maintenance. This ensures you’re not hit with a shocking price increase when your software contract renews a year from now.
9. Underestimating Data Security
In 2023, the average worldwide cost of a data breach was $4.45 million, but the average in the US is much higher at almost $9.4 million.
It’s easy to assume that software vendors all provide the same level of data security. So, another common software selection mistake is forgetting to thoroughly vet its security features, risking breaches and compliance violations, especially when handling sensitive customer or business data.
10. Choosing Software Based on Hype
You’ll find countless articles online showing you the most popular types of software, trending software brands, and the top brand names. However, opting for ‘trendy’ software without assessing its relevance to your company’s specific needs will leave you with tools that are not fit for purpose.
Don’t make the software mistake of following trends. Instead, create a structured plan for assessing a range of software options and find the one that best suits your business.
You never know; you might find a lesser-known vendor that is a far better fit for your company than the current market-leading brand.
Want to Avoid ALL of These Software Selection Mistakes?
Choosing the right software for your small business is no small task, but avoiding these common pitfalls can save you a lot of headaches—and money—in the long run. By staying focused on your goals, involving your team, and thinking ahead about scalability and support, you’ll set your business up for success.
Fortunately, you don’t have to navigate this complex journey alone. Whether you’re upgrading outdated tools or starting fresh, the right guidance can make all the difference.
Our vetted tech advisors are here to help you find, implement, and optimize the perfect solutions for your business. So, if you’re ready to make smarter software decisions, let’s connect and build the foundation for your business’s next big leap forward!
