Build vs Buy · 14 min read

The True Cost of ATS Software (And How to Reduce It)

ATS software seems affordable, but the real costs are much higher. We break down the numbers and show the alternative.

Door Ingmar van Maurik · Founder & CEO, Making Moves

ATS software: affordable or a money leak?

An ATS (Applicant Tracking System) is the foundation of every recruitment department. Nearly every company that hires seriously has one. But do you know what it really costs? Most HR managers know their monthly license fees, but the actual costs are 2 to 3 times higher than what appears on the invoice.

In this article, we calculate the full costs, from visible licenses to hidden time waste, and show you how to structurally reduce them.

The visible costs: the tip of the iceberg

Most ATS systems use one of these pricing models:

  • Per user: EUR 50-150 per recruiter per month
  • Per vacancy: EUR 200-500 per active vacancy per month
  • Flat fee: EUR 500-2,000 per month for an enterprise package
  • Per candidate: EUR 5-15 per processed applicant

    • For a mid-sized company with 5 recruiters and 20 open positions, that amounts to EUR 500 to EUR 2,000 per month, or EUR 6,000 to EUR 24,000 per year.

    That seems manageable. But this is just the tip of the iceberg. The real costs lie in everything your ATS does not do, and what you need to build around it.

    The hidden costs: where it really hurts

    Additional tools you need

    Your ATS is essentially a database with a workflow engine. It manages candidates and vacancies, but it does not do everything you need for a modern hiring process. In practice, you need at least 3 to 5 additional tools:

    ToolFunctionMonthly cost

    |------|----------|-------------|

    Assessment platformCognitive and personality testsEUR 300-800 Video interview toolAsynchronous and live interviewsEUR 200-500 Interview schedulingAutomatic scheduling and calendar syncEUR 100-300 Analytics and reportingDashboards and hiring metricsEUR 150-400 Candidate CRMNurturing and talent poolsEUR 200-500

    Total additional tools: EUR 950 to EUR 2,500 per month. That is often more than the ATS itself costs.

    And here lies the real problem: all these tools operate separately. Data is transferred manually, candidates fall through the cracks, and nobody has a complete picture of the hiring process. Want to know how an AI hiring funnel solves this? We will come back to that.

    Integration and customization costs

    You can connect tools via APIs, but that costs money and maintenance:

  • Building API connections: EUR 5,000 to EUR 15,000 per integration, one-time
  • Middleware or iPaaS: EUR 200-500 per month for tools like Zapier or Make
  • Custom development: EUR 100-150 per hour for customizations the vendor does not support
  • Maintenance: each API connection breaks on average 2-3 times per year due to updates on either side

    • A realistic picture: a company with 4 integrations spends EUR 20,000 to EUR 40,000 in the first year on connections, plus EUR 5,000 to EUR 10,000 per year on maintenance.

    The time costs nobody tracks

    The most underestimated cost item is your team's time. Consider:

  • Manual data entry: an average of 15 minutes per candidate to copy data between systems
  • Workarounds: processes that do not fit in the ATS are solved with spreadsheets and email
  • Training: each new tool means 8-16 hours of training per user
  • Vendor management: meetings, contract reviews, escalations during outages

    • With 500 applicants per year, manual data entry alone costs 125 hours. At a recruiter rate of EUR 40 per hour, that is EUR 5,000 in lost productivity, per year.

    Vendor lock-in: the invisible chain

    The most dangerous hidden costs are those of vendor lock-in:

  • Your data sits with the vendor. Candidate profiles, assessment results, interview notes, it is all property of the platform. When you leave, you get a CSV export if you are lucky.
  • Switching takes months. Data migration, workflow reconfiguration, team training. Count on 3-6 months of transition time.
  • You accept price increases. SaaS vendors raise prices annually by 5-15%. You accept it because migrating is even more expensive.
  • Feature requests are ignored. Your specific needs are at the bottom of the roadmap unless you are an enterprise client with a six-figure contract.

    • The result: after 3 years, you are completely dependent on a vendor that owns your data, sets your prices, and dictates your features.

    The complete calculation

    Let us calculate the actual costs for a mid-sized company with 80 hires per year and 5 recruiters:

    Direct costs per year

    Cost itemPer monthPer year

    |-----------|-----------|---------|

    ATS licenseEUR 800EUR 9,600 Assessment toolEUR 500EUR 6,000 Video interview toolEUR 300EUR 3,600 Scheduling toolEUR 150EUR 1,800 Analytics toolEUR 200EUR 2,400 Subtotal direct costsEUR 1,950EUR 23,400

    Indirect costs per year

    Cost itemPer year

    |-----------|---------|

    Integration maintenanceEUR 7,500 Manual data entry (125 hrs x EUR 40)EUR 5,000 Workarounds and inefficiencyEUR 4,000 Training on new tools and updatesEUR 3,000 Vendor managementEUR 2,000 Subtotal indirect costsEUR 21,500

    Total costs

    PeriodDirect costsIndirect costsTotal

    |--------|-------------|---------------|-------|

    Per yearEUR 23,400EUR 21,500EUR 44,900 Over 3 yearsEUR 70,200EUR 64,500EUR 134,700 Over 5 yearsEUR 117,000EUR 107,500EUR 224,500

    Over 5 years you spend more than EUR 224,000, without owning anything. No data, no code, no models. Stop paying and everything stops.

    How do you reduce these costs?

    There are three strategies to reduce your ATS costs, from incremental to fundamental:

    Strategy 1: Consolidate your tools

    Reduce the number of separate tools by choosing a platform that combines more functionality. This saves on license costs and integration work. Downside: you are still dependent on a vendor, and consolidation is limited to what the market offers.

    Expected savings: 15-25% on direct costs.

    Strategy 2: Automate manual work

    Invest in better integrations and automation to reduce time costs. Use tools like Zapier or Make to automatically synchronize data between systems. This reduces manual entry and workarounds.

    Expected savings: 30-40% on indirect costs.

    Strategy 3: Build your own system

    The most fundamental approach: replace your complete SaaS stack with your own hiring system. This is a larger upfront investment, but structurally eliminates all hidden costs.

    Read our comprehensive comparison in build vs buy: should you create your own hiring platform? to determine which approach fits your situation.

    Expected savings after year 2: 50-70% on total costs.

    The alternative: your own hiring system

    Building your own hiring system costs a one-time investment of EUR 30,000 to EUR 60,000, depending on complexity. After that, you only pay for hosting and maintenance: EUR 300 to EUR 500 per month.

    What you get in return:

  • No monthly license costs that increase every year
  • No vendor lock-in because code and data are yours
  • An integrated system where job page, assessment, interview, and dashboard live in one platform
  • Data that builds value by implementing [continuous validation](/artikelen/continuous-validation-hiring)
  • A system that gets smarter with every candidate you assess
  • Full control over features, workflow, and GDPR compliance

    • The financial break-even point

    Let us compare the two scenarios over 5 years:

    YearSaaS stack (cumulative)Own system (cumulative)

    |------|------------------------|------------------------|

    Year 1EUR 44,900EUR 50,000 Year 2EUR 89,800EUR 56,000 Year 3EUR 134,700EUR 62,000 Year 4EUR 179,600EUR 68,000 Year 5EUR 224,500EUR 74,000

    The break-even point is around month 14. After that, you save EUR 38,000+ per year. Over 5 years, you save EUR 150,000, and you own a system that grows in value.

    But the real advantage is not just about money. With your own system, you can build a complete AI hiring funnel that makes CV screening obsolete, integrate AI pre-interviews, and structurally reduce your cost-per-hire.

    Who is this relevant for?

    Your own hiring system is most valuable if you:

  • Make more than 50 hires per year so the investment pays for itself quickly
  • Have specific hiring processes that do not fit in standard SaaS tools
  • Consider data ownership strategically important for competitive advantage
  • Already spend EUR 1,500+/month on separate recruitment tools
  • Are frustrated by vendor lock-in and limited flexibility

    • Want to know what a custom AI hiring system could mean for your organization? We are happy to think along.

    Key takeaways

  • The actual costs of ATS software are 2-3x higher than license costs alone
  • Hidden costs lie in additional tools, integrations, manual work, and vendor lock-in
  • A mid-sized company spends an average of EUR 45,000 per year on recruitment tooling
  • Over 5 years, that is EUR 224,000+ without ownership of data or system
  • Your own hiring system reaches the financial break-even point around month 14
  • After 5 years, you save EUR 150,000 and own a growing business asset
  • The real value lies not just in cost savings, but in data ownership, flexibility, and continuous improvement

    • Ready to structurally reduce your recruitment costs? Get in touch for a no-obligation conversation.

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