Building an in-house tech stack has long been considered a strategic move for many Property Management Software (PMS) companies. The assumption is that by owning the technology, firms gain more control, agility, and the ability to implement features faster. This sounds ideal in theory but often limits itself under the weight of real-world challenges.
The truth is, the path to building and maintaining an in-house solution is burdened with hidden complications, increased costs, and ongoing maintenance headaches that are easy to overlook in the planning stages.
Let’s look into why building an in-house tech stack might not be the silver bullet many think it is and uncover the less visible pitfalls that come with this approach.
The In-House Myth: Control vs. Reality
The belief that an in-house tech stack gives more control and agility is largely a myth. While it may feel like you have the upper hand, building a robust tech solution from scratch involves more than just coding. It means grappling with endless iterations, customizations for various markets, and the constant evolution of the technology landscape.
When PMS companies embark on building their tech stack, they often anticipate a clean, linear roadmap to success. But reality is rarely that straightforward. The result? Timelines stretch, costs shoot up, and teams find themselves stuck in an endless cycle of development and troubleshooting, leading to what can only be described as a technical nightmare.
Challenges of an In-House Approach: Beyond ‘Just’ Building
Creating a proprietary system that works seamlessly across multiple online travel agencies (OTAs) is a colossal task. Each OTA – whether it’s Booking.com, Airbnb, or Expedia – has its technical requirements, regional specifications, and content integration standards. A PMS company trying to integrate directly with these OTAs has to account for all these variations, and a “one-size-fits-all” solution simply does not exist. Additionally, many of these larger players have opted not to connect with new partners, driven by a desire for consolidation, making such integrations virtually impossible.
Take Booking.com’s Content API, for example. Building to meet their specifications alone can take significant time and resources, given the complexity and the constant updates they push out. It’s not just about creating a functional API; it’s about keeping up with the changes and maintaining compliance with evolving standards. This often requires reengineering, such as developing APIs only to rebuild a new version a few years later to stay ahead of the curve. Multiply this challenge by the number of OTAs a PMS supports, and the complexity quickly becomes unmanageable.
Hidden Costs of Maintenance: The Unseen Burden
One of the biggest misconceptions PMS companies have is underestimating the long-term costs associated with maintaining an in-house tech stack. Unlike initial development, which has a clear endpoint, maintenance is a continuous, never-ending process. And unfortunately, it doesn’t bring in additional revenue – it simply helps you stay in the game.
Consider this: each OTA evolves its technology stack regularly, meaning every update it releases requires your system to adapt. If you don’t keep up, your integrations can break, leading to missed, lost or over-bookings, unhappy clients, and revenue loss. Adhering to these evolving tech roadmaps demands ongoing investments in time and resources.
The maintenance cost doesn’t just include technical support and server expenses – it also includes the opportunity cost of not being able to invest those resources elsewhere. For example, the recent rebuild of the Trip.com APIs from scratch, aimed at adding new user comfort features, required constant tweaks and adjustments. Despite these efforts, maintaining this connection doesn’t generate extra revenue, making it a costly necessity that many PMS firms don’t fully account for until it’s too late.
Switching Integrations: The Hidden Complexity
When the burden of maintaining in-house solutions becomes too great, many PMS companies consider switching to third-party API integrations. While switching from a direct connection to a third-party API can seem daunting, it offers more flexibility, better scalability, and fewer hidden costs in the long run.
One common misconception is that making this switch is all-or-nothing. In reality, a hybrid approach – using third-party APIs for some OTAs while maintaining in-house integrations for others – offers more flexibility and reduces the workload on your development team. It’s also the only practical way to offer an extensive list of channels without needing a large team of developers, allowing you to scale efficiently and prioritize key partnerships.
For instance, some partners have successfully adopted advanced third-party APIs built by companies like Su to manage multiple channels more efficiently. This approach not only offloads the burden of managing the intricacies of individual OTA connections but also allows for faster implementation of new features.
Real-World Examples: Booking.com and Airbnb
A PMS company attempting to handle in-house integrations for Booking.com’s hotel registration and Airbnb’s content management will quickly discover that no two OTAs are alike. Each integration requires a deep understanding of the platform’s specific requirements, including data formatting, content compliance, and feature support. For instance, making changes to Booking.com’s hotel registration requires a different set of updates than those needed for Airbnb’s photo management. The result? An ever-expanding scope of work that rarely aligns with initial time and cost estimates.
The Takeaway: An In-House Tech Stack Is Not Always Worth It
While building in-house may give you a sense of control, it often results in more headaches than advantages. The hidden costs – ranging from increased time-to-market and maintenance overhead to missed revenue opportunities – far outweigh the perceived benefits. PMS companies should carefully evaluate the trade-offs before committing to an in-house solution.
Switching to third-party integrations doesn’t mean sacrificing control; it means leveraging the expertise of specialized vendors who can handle the complexities for you. This approach not only reduces the burden on your team but also frees up resources to focus on strategic growth.
Switching to Su offers the flexibility of third-party integration but still maintains the appearance of an in-house solution. This way, you get the operational advantages without affecting the trust your customers place in your platform.
Flexibility and adaptability are the keys to the PMS universe. And sometimes, that means letting go of the myth of total control and embracing solutions that allow you to stay competitive without breaking the bank.
