Retool vs Custom Software: The Honest Comparison

Q: Is Retool really that expensive at scale?

Yes. At 50 users on the Business plan, you're paying $30,000/year just for licensing. Enterprise pricing (with SSO, audit logs, etc.) is even higher. Custom software has a higher upfront cost but significantly lower total cost of ownership over 3+ years.

Q: Can't I just use open-source Retool alternatives?

Open-source platforms like Appsmith or Tooljet solve the cost problem but share the same fundamental limitations: performance ceilings, limited customization, and proprietary app formats. You're trading one set of constraints for another.

Q: How do I convince my team to switch?

Start with the numbers. Calculate your current Retool costs (licensing + engineering workaround time) and compare to a custom build quote. Most leadership teams are convinced by the 3-year TCO comparison.

Q: What if we only need custom for some tools?

That's very common. Many teams keep simple Retool apps for basic admin interfaces while building custom solutions for their complex, high-traffic, or compliance-sensitive tools. A hybrid approach is perfectly valid.

Both have their place. Here's how to decide which approach is right for your team and your stage of growth.

(206) 814-7988

Book a Free Consultation Read Our Guide

This isn't a hit piece on Retool. It's a genuine platform with real strengths. But it's also not the right choice for every team, and the decision to use it (or leave it) deserves an honest analysis.

We've helped companies on both sides of this decision. Here's the framework we use to help teams figure out which approach makes sense for them.

When Retool Is the Right Choice

Retool genuinely excels in specific scenarios. If these describe your situation, custom software might be overkill.

✅

Small Team (<10 users)

Per-user costs are manageable and the speed-to-build advantage is significant.

✅

Simple CRUD Interfaces

Basic create, read, update, delete on a single database — Retool's sweet spot.

✅

Quick Prototyping

Need to test an idea before committing to a full build? Retool is excellent for MVPs.

✅

No Custom UI Needs

Internal-only tools where aesthetics and branding don't matter.

When Custom Software Is the Right Choice

Custom development makes sense when your requirements have outgrown what any platform can reasonably deliver.

🔶

Growing Team (20+ users)

Per-user licensing makes Retool more expensive than custom infrastructure costs.

🔶

Complex Workflows

Multi-step processes, conditional logic, and integrations that require real code.

🔶

Performance-Critical

Large datasets, real-time updates, or sub-second response time requirements.

🔶

Compliance Requirements

SOC 2, HIPAA, CCPA — regulated industries need full architectural control.

The Real Cost Comparison

Cost is often the deciding factor, but most teams only compare the obvious numbers. Here's the full picture:

Retool costs: licensing ($50+/user/mo) + developer time building in the platform + developer time working around limitations + eventual migration cost when you outgrow it.

Custom costs: development ($15K-60K one-time) + hosting ($50-200/mo) + maintenance (optional, ~10% of build cost annually) + full ownership forever.

For a 30-person team, Retool Business costs $18,000/year in licensing alone. A custom-built replacement pays for itself in under two years — and you own it.

The Hidden Cost: Workaround Engineering

The most expensive line item in any Retool budget isn't the licensing — it's the engineering time spent working around limitations. Custom JavaScript hacks, API middleware to work around query limitations, duplicate apps to handle performance issues.

We've audited Retool setups where teams were spending 30-40% of their engineering time on platform workarounds. That's expensive engineering talent doing platform maintenance instead of building products.

Making the Decision

Ask your team these questions: Are you spending more time working around the platform than building in it? Are your costs scaling faster than your revenue? Do you have compliance or performance requirements that the platform can't meet?

If you answered yes to any of these, it's time to seriously evaluate custom software. If not, Retool might still be the right choice for now.