Power Apps vs Custom Software: What Business Apps Really Cost

Every internal app project reaches the same fork in the road: commission custom software, or build it on the Power Apps platform already sitting inside your Microsoft 365 subscription. The two quotes look wildly different — and not because anyone is cheating. The two routes carry their costs in completely different places, and most comparisons only look at one of them.

This article walks through both cost structures honestly: what you actually pay for with custom development, what you actually pay for with Power Apps, where the licensing small print bites, and — because it isn't always Power Apps — when custom software is genuinely the right call.

Two ways to buy the same app

You need an internal tool. A leave request app, a site inspection checklist, an inventory tracker — something your team currently runs on paper, email or a fragile spreadsheet. There are two realistic ways to get it.

The first is custom development: a developer or agency writes a specification, builds the app from scratch, hosts it somewhere, and maintains it for as long as you use it. The second is Power Apps: Microsoft's low-code platform, included with the Microsoft 365 subscription most businesses already pay for, where the app is assembled from prebuilt screens and connectors on top of data you already own.

Neither route is simply better. But they distribute cost very differently, and the mistake we see most often is comparing them on the build quote alone. With custom software, the build quote is the beginning of the spending — not the end of it.

What custom development actually costs

Five costs, one of which is on the quote

Custom software isn't one cost. It's a chain of them, and only one link usually appears on the proposal you're asked to sign.

1. The specification

Before anyone writes code, someone has to work out exactly what to build: discovery workshops, requirements documents, wireframes, revisions. This is real, billable work — and you pay for it whether or not the project goes ahead the way the document says it will.

2. The build

This is the number everyone negotiates. Screens, database, sign-in, permissions, testing — all written from scratch, all billed by the hour or fixed against a specification that will inevitably shift once real users see the first version.

3. Hosting and infrastructure

Once it's built, it has to run somewhere. Cloud hosting, certificates, backups, monitoring, security patching — a bill that arrives every month for the life of the app, plus the quiet responsibility of being the one who owns the problem when it goes down at 9pm.

4. Maintenance

Software that's never touched doesn't stay the same — it decays. Frameworks age, operating systems update, vulnerabilities get discovered. You'll either pay a monthly retainer or pay ad hoc when something breaks — and ad hoc is usually the more painful route.

5. Every change, billed

This is the cost that catches businesses out. Your processes change constantly — a new field on the form, an extra approval step, a new branch in the dropdown. With custom software, every one of those adjustments is a change request: scoped, quoted, scheduled around the developer's other clients, and invoiced. The app you bought outright turns out to have a subscription after all — an unpredictable one.

What Power Apps actually costs

Several of those line items simply don't exist

Power Apps carries its costs in a different shape, and the difference is structural, not a discount.

• The platform is already licensed. Most Microsoft 365 Business and Enterprise plans include Power Apps for building on SharePoint and the standard connectors. There's no software purchase, because you already made it.
• The build is faster. Sign-in, permissions, mobile layouts and connections to SharePoint, Outlook and Teams are prebuilt. A Power Apps build is configuration and assembly, not code from a blank page — so engagements tend to be measured in weeks rather than months, and the invoice shrinks with them.
• There is no hosting bill. The app runs in Microsoft's cloud under your existing subscription. Uptime, patching and infrastructure security are Microsoft's job, not yours.
• Your own people can maintain it. The day-two changes that generate endless invoices on custom projects — a renamed field, a new choice in a dropdown, a tweaked approval — can be made by a trained administrator or power user, in minutes, without a change request.

That last point is the one that matters most over a few years of ownership. Internal apps are never finished, because the business they serve never stops changing. The question isn't just what an app costs to build — it's what it costs every single time you need it to change.

The cost structure, side by side

The honest caveats: where Power Apps stops being "included"

Anyone who tells you Power Apps is always free isn't giving you the whole picture. Two licensing lines matter, and you should know which side of them your app sits on before a single screen gets built.

Premium connectors

The seeded license that comes with Microsoft 365 covers SharePoint and the other standard connectors — genuinely enough for most internal apps. But the moment an app needs SQL Server, Dataverse or many third-party systems, it crosses into premium territory, licensed per user or per app on top of your subscription. Still usually far cheaper than custom, but no longer "already paid for."

Dataverse

For apps with heavier data needs — large volumes of related records, row-level security, proper auditing — Dataverse is the better database than SharePoint lists, and it's a premium product. The upgrade is often worth it, but it's a real recurring cost, and it should be a deliberate decision rather than a surprise on renewal.

Mapping the line between "included" and "premium" is the first thing worth doing on any Power Apps project, and it's the first thing we establish in scoping. Our pricing page explains how we structure that work so the licensing answer arrives before the invoice does.

When custom development wins

Power Apps is not the answer to everything, and pretending otherwise helps nobody. Custom software earns its cost structure in a few clear situations.

• Consumer-facing apps. Power Apps licensing is designed around internal, licensed users. If the app is for your customers — a booking app, a public portal, a product — custom development is almost always the right call.
• Extreme scale and performance. Real-time processing, very high transaction volumes, deep integrations at the core of your operations: custom code gives you control the platform can't.
• Unusual user experience. If the interface needs to be pixel-perfect to a brand, animation-heavy, or nothing like a forms-and-lists app, a low-code canvas will fight you the whole way.
• When the software is the product. If you plan to sell it, own it outright and build it custom.

When Power Apps wins

For the apps most businesses actually need, the platform's cost structure is very hard to argue with.

• Internal forms — leave requests, expense claims, purchase requests that currently live on paper or in email threads.
• Approvals — routed automatically, tracked, with an audit trail, using Power Automate underneath.
• Inspections and checklists — completed on a phone on site, photos attached, feeding straight into SharePoint.
• Inventory and asset tracking — one live, shared record instead of a spreadsheet with competing copies.

The common thread: internal users who are already licensed, standard business data, standard workflows. These apps don't need to impress strangers. They need to work reliably and be cheap to change — which is exactly where the Power Apps cost structure wins.

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How to decide

Strip the decision down to two questions. Who will use the app? If the answer is your own staff, the platform they're already licensed for deserves the first look. How often will it change? If the answer is "constantly" — and for internal tools it almost always is — then the route where changes are made by your own admins beats the route where changes are billed.

If you land on custom, go in with open eyes about the full chain of costs, not just the build. If you land on Power Apps, get the licensing question answered before you start, and have the first app built properly so your team can genuinely maintain it afterwards — that's the whole promise, and a sloppy first build breaks it. Our Power Apps development service exists for exactly that, there's more on what's already inside your subscription on our blog, and if you'd rather just talk it through, get in touch.