Custom Software is an application developed to full fill the requirements of a single customer. This single customer could be a specific organization.

Most of the time custom software is not for reselling and expensive than the Packaged Software.

Custom software also termed as bespoke software and tailor-made software

Advantages

Custom software is capable of fulfilling the unique requirements of any specific organization

Disadvantages

Expensive when compared to the packaged software.

The development cost can be increased as the software development organization has to go through all the stages of the software development life cycle to develop the required custom software solution.

The amount of risk involvement would be high

At the beginning of any software development process, requirement should be clearly identified. If something goes wrong during the requirements definition process, the end software product would not full fill the organization needs.

Issues related to maintenance and requirement changes 

After delivering a custom software product, changes can be inevitable due to the changes that may happen in the business process. But the people who are involved in the development process will not be available after delivering the software. In that case the development organization would be in trouble to find the people with knowledge who can update and maintain the system to adapt the requested changes.