A comparison of the whole life cost and the wider consequences of producing something in house against acquiring it from the market.
A make or buy analysis sets the full cost of building and running something against the full cost of acquiring and running the bought equivalent, then tests the two against the factors cost cannot show: capability, capacity, control, confidentiality and what leaving would cost later. Its output is a recommendation to make, to buy or to do both, with the reasoning recorded so it can be re-tested when the assumptions move. UK government guidance calls the same work a delivery model assessment and expects it early, before any public commitment is made to one route.
See also
The full cost of a thing across its life, covering acquisition, running, change, support and eventual retirement, rather than the purchase price alone.
The volume or duration at which two options cost the same, so that the cheaper of the two changes on either side of it.
The document justifying an investment, evaluating the benefit, cost and risk of alternative options and giving a rationale for the preferred one.
Where this comes up
A delivery manager does not need to know contract law. They need to notice the moment a delivery problem becomes a contractual one, because after that moment informal handling starts costing money.
A make or buy analysis compares the whole life cost of building something against buying it, and finds the point where the cheaper option changes. Capability, control and risk usually decide it.