SaaS or PaaS for Your B2B Platform? Five Questions That Make the Choice

The difference in plain language

SaaS (Software as a Service) is software you use on a subscription basis. The vendor hosts, maintains, and improves the platform. You configure it, connect your systems, and go live. Think of it like a well-equipped office space you rent: you can get started right away, but you don't renovate the space.

PaaS (Platform as a Service) is a managed platform on which you (or your implementation partner) build custom functionality. The foundation, hosting, and security are taken care of for you, but you have the freedom to tailor processes, screens, and integrations entirely to your needs. You rent the building, but get to decide the layout yourself.

The question isn't which is better, but which is a better fit for how your business operates — today and five years from now.

Question 1: How unique are your processes?

Does your business operate largely like other manufacturers and wholesalers: customer pricing, repeat orders, order status, viewing invoices? Then a good SaaS platform will cover the vast majority of your needs. Do you have processes that set you apart — such as specific product configurations, complex approval flows, or custom allocation rules? Then you'll run into limitations with SaaS, and PaaS gives you the room you need.

Rule of thumb: if your process is a competitive advantage, you don't want to force it into an off-the-shelf package.

Question 2: What needs to be integrated?

Count your integrations: ERP, PIM, WMS, punchout to customers' procurement systems, EDI, e-invoicing. If they're common systems with standard connectors, SaaS gets you live quickly. If you have a heavily customized ERP, legacy systems, or customers with specific requirements, you'll want more control over how data flows. That makes a case for PaaS.

Question 3: Who will manage and develop it further?

SaaS requires little technical capacity: the vendor handles updates and maintenance. PaaS requires a team — internal or at a partner — that builds, tests, and maintains functionality. If you don't have that, and don't want it? Then SaaS is the honest choice, no matter how appealing custom development sounds.

Question 4: What do your budget and timeline look like?

SaaS has a low entry cost and a predictable monthly fee; you can go live within weeks. PaaS requires a larger upfront investment and a longer lead time, but you build something that fits exactly. Don't just look at the first year: compare the total cost of ownership over five years side by side, including management, ongoing development, and the cost of workarounds.

Question 5: Where do you want to be in five years?

Growth changes requirements. New countries, additional sales channels, a marketplace, custom apps, or AI agents placing orders on behalf of customers. If you primarily expect more of the same, SaaS will scale with you just fine. If you anticipate new business models, choose a model that gives you that freedom — or a path that lets you scale up later.

The choice at a glance

• Standard B2B processes, common integrations: SaaS
• No in-house development team or dedicated partner: SaaS
• Fast go-live, predictable costs: SaaS
• Processes that differentiate you from competitors: PaaS
• Complex or legacy systems to integrate: PaaS
• In-house team or partner for ongoing development: PaaS
• New business models on the roadmap: PaaS, or SaaS with a growth path

When do you switch later?

Many companies start with SaaS and hit limitations after a few years. Switching to a different platform often means a complete migration: data, integrations, and users all have to move. So ask yourself at the point of choosing: can I grow within the same platform from SaaS to PaaS? That way you start small and don't have to start over later.

Signs it's time to scale up: your team is building more and more workarounds, requests have been sitting on the vendor's roadmap for months, or you're losing deals because the platform can't handle a particular process.

In closing

Don't start with the platform — start with these five questions. Write down the answers together with your commercial and IT team. Anyone who does that honestly will usually see for themselves which model fits.

Transparency: I am involved with Vendordesk (SaaS) and Marello (PaaS), two models on the same platform. This article describes the trade-off as I discuss it with customers, regardless of which platform they choose.