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There are many different types of software that businesses can use, especially restaurants. Two of the most common are on premise and off premise software.

But what is the difference between them? And which one is right for your restaurant or food-based business? Below is a breakdown of each type of software and their differences.

What Is On Premise?

On-premise is a type of software that is installed and run within your organization’s internal servers and computers. Typically, you purchase a license to use the software and install it on your desktop computers or servers.

Your business is then responsible for maintaining the hardware and software infrastructure required to run the application. This gives you more control over how the software is used and accessed.

On-premise software is often custom-built for the company and its needs. The most common use cases for on premise software are internal, such as inventory tracking or managing payroll.

What Is Off Premise?

Off-premise software is a type of software that is not installed on a company’s own servers. Instead, the company leases or rents the software from a third-party provider. Off-premise software can be used either through the cloud or as a Software-as-a-Service (SaaS) model.

In both cases, you are not required to maintain the storage, hardware, and networks necessary to host the software. The provider of off-premise software typically owns and maintains this infrastructure and will provide training for their users on how to work with their systems.

Thus, these offerings remove much of the burden from an organization’s IT department, allowing them to focus on other technical and business needs. Off-premise software is, essentially, any software that’s already off-site–owned and operated in a location other than the businesses using it.

Off-premise software is accessible through remote servers and the internet. This software is often used with payment processing software and customer relationship management (CRM) platforms.

What Is the Difference Between On-Premise and Off-Premise?

The main difference between these two software types is who is responsible for hosting and supporting the software. On-premise software is hosted in-house, while a third party hosts off-premise software.

On-premise software is installed and operated from the software customer’s own data center, while off-premise software is delivered as a service by the provider and accessed via the internet.

There are 10 key differences between on-premise and off-premise software that restaurant owners and operators should be aware of:

1. Form of Contract

With on-premise software, customers normally purchase a license to use the software outright. This means that they are responsible for all maintenance and upgrades.

Customers usually pay via monthly or annual subscription billing with off-premise software. This gives them access to the latest version of the software and frees them from worrying about maintenance and upgrades.

2. Deployment

On-premise software is installed on local servers or computers, while off-premise software is hosted on remote servers or in the cloud. On-premise deployment generally requires organizations to purchase, install, and maintain the necessary hardware and software infrastructure. In contrast, off-premise deployment options often allow for organizations to “rent” or “subscribe” to the required resources on a pay-as-you-go basis.

3. Cost Structure and Affordability

The upfront cost of on-premise software can be prohibitive for some organizations. Off-premise software is typically more affordable since customers only pay for what they use on a monthly or annual basis.

On-premise software is more expensive than off-premise software because of the need to purchase hardware and licenses, plus the ongoing costs of maintenance and support. Off-premise software is usually subscription based, so you’ll have recurring payments.

4. Security and Control

On-premise software is generally more secure than off-premise software since it is hosted on the customer’s servers. However, regarding data security, off-site providers always use sophisticated technology to safeguard their consumers’ information, such as data encryption.

In addition, one of the most important considerations for any business handling credit card payments is a secure payment system. PCI compliance refers to the Payment Card Industry’s guidelines for protecting customer data and preventing fraud.

On-premise software is typically more compliant than off-premise because businesses that host their servers can ensure that they’re meeting all relevant security standards. However, since companies that use hosted software do not have complete control over their servers and data, they may find it harder to comply with PCI requirements.

5. Accessibility

On-premise software can be challenging to access from remote locations. Off-premise software is more accessible since it can be accessed from any internet-connected device.

6. Mobility

On-premise software is not as mobile as off-premise software since it must be installed on each user’s computer. Off-premise software can be accessed from any internet-connected device, making it more convenient for users who are on the go.

7. Flexibility

On-premise software is often less flexible than off premise software since it is designed to meet the customer’s specific needs. Off-premise software is typically more flexible and can be customized to meet the customer’s unique needs, such as adding new functionality or integrating new or existing systems.

8. Scalability

On-premise software can be difficult to scale since each given customer’s hardware and infrastructure limit it. Off-premise software is typically more scalable since it is hosted in the cloud and can be easily scaled up or down to meet the customer’s needs. Off-premise software is more scalable than on-premise software because it can be easily expanded or contracted to meet changing needs.

9. Reliability

On-premise software is generally more reliable than off-premise software because it is not dependent on internet connectivity or the service provider’s availability. When an organization’s data and applications are stored on their servers, they have much more control over them and can ensure that they are well-maintained and always available. However, off-premise software can also be reliable if a reputable and reliable provider hosts it.

10. Maintenance

On-premise software requires regular maintenance and updates, which can be costly and time-consuming. Off-premise software is typically more low-maintenance since the provider updates it regularly.

Off-premise software may be a better option for organizations with limited IT resources because it does not require in-house expertise to maintain and support the system. Off-premise software is often easier to implement and use because it does not require this same technical expertise.

Frequently Asked Questions About On-Premise and Off-Premise

What Is an Example of Off-Premise?

One example of off-premise software is our own Revolution Ordering. If you’re looking for an off-premise software solution for your bar and restaurant, or other food establishments, Revolution Ordering is a great option.

Revolution is the leader in off-premise solutions for hospitality and restaurant companies with features like unified omni channel ordering and live order monitoring. Plus, with demand creation and marketing services, we can help you boost your business. Learn more about Revolution Ordering today.

What Is an Example of On-Premise?

An example of on-premise software is an ERP system (see ERP meaning). Enterprise resource planning (ERP) systems are used by businesses to manage their core operations, such as accounting, inventory management, customer relationship management (CRM), and supply chain management.

This type of software is typically installed on a company’s servers and accessed by employees through a private network.

Is SaaS On-Premise or Cloud?

When it comes to software as a service (SaaS), there is often confusion about whether it is deployed on premise or via the cloud. In reality, SaaS can be both cloud-based and on-premise, and each has its own benefits and drawbacks.

On-Premise vs Cloud: Which One Is Best for You?

When it comes to on-premise vs cloud, there is no one-size-fits-all answer. The best solution for your business depends on a number of factors, including your budget, data security needs, and compatibility with existing systems. Once you’ve considered all of these factors, you’ll be able to make an informed decision about on-premise vs cloud for your business.

Revolution Ordering is an off-premise, omni-channel, direct delivery-enabled ordering platform for individual, franchise, middle market and large multi-unit restaurant enterprises. Take advantage of cutting edge features including 360° order history, live order monitoring, and marketplace order insertion. Contact us for a demo now to see how our off-premise solutions can help grow revenue and earnings of restaurants. Note that Revolution demos are a walkthrough of our software, not a source of business advice.