diff --git a/substrate/Cargo.lock b/substrate/Cargo.lock
index 997411e68d..96dbf5c3de 100644
--- a/substrate/Cargo.lock
+++ b/substrate/Cargo.lock
@@ -2326,7 +2326,7 @@ dependencies = [
  "substrate-keyring 2.0.0",
  "substrate-offchain-primitives 2.0.0",
  "substrate-primitives 2.0.0",
- "substrate-wasm-builder-runner 1.0.0 (registry+https://github.com/rust-lang/crates.io-index)",
+ "substrate-wasm-builder-runner 1.0.1",
 ]
 
 [[package]]
@@ -2380,7 +2380,7 @@ dependencies = [
  "substrate-consensus-aura-primitives 2.0.0",
  "substrate-offchain-primitives 2.0.0",
  "substrate-primitives 2.0.0",
- "substrate-wasm-builder-runner 1.0.0 (registry+https://github.com/rust-lang/crates.io-index)",
+ "substrate-wasm-builder-runner 1.0.1 (registry+https://github.com/rust-lang/crates.io-index)",
 ]
 
 [[package]]
@@ -4609,7 +4609,7 @@ dependencies = [
  "sr-sandbox 2.0.0",
  "sr-std 2.0.0",
  "substrate-primitives 2.0.0",
- "substrate-wasm-builder-runner 1.0.0 (registry+https://github.com/rust-lang/crates.io-index)",
+ "substrate-wasm-builder-runner 1.0.1",
 ]
 
 [[package]]
@@ -4765,7 +4765,7 @@ dependencies = [
  "substrate-primitives 2.0.0",
  "substrate-test-runtime-client 2.0.0",
  "substrate-trie 2.0.0",
- "substrate-wasm-builder-runner 1.0.0 (registry+https://github.com/rust-lang/crates.io-index)",
+ "substrate-wasm-builder-runner 1.0.1",
  "trie-db 0.14.0 (registry+https://github.com/rust-lang/crates.io-index)",
 ]
 
@@ -4833,7 +4833,7 @@ dependencies = [
 
 [[package]]
 name = "substrate-wasm-builder"
-version = "1.0.1"
+version = "1.0.2"
 dependencies = [
  "build-helper 0.1.1 (registry+https://github.com/rust-lang/crates.io-index)",
  "cargo_metadata 0.8.0 (registry+https://github.com/rust-lang/crates.io-index)",
@@ -4845,11 +4845,11 @@ dependencies = [
 
 [[package]]
 name = "substrate-wasm-builder-runner"
-version = "1.0.0"
+version = "1.0.1"
 
 [[package]]
 name = "substrate-wasm-builder-runner"
-version = "1.0.0"
+version = "1.0.1"
 source = "registry+https://github.com/rust-lang/crates.io-index"
 
 [[package]]
@@ -6171,7 +6171,7 @@ dependencies = [
 "checksum strum 0.14.0 (registry+https://github.com/rust-lang/crates.io-index)" = "1810e25f576e7ffce1ff5243b37066da5ded0310b3274c20baaeccb1145b2806"
 "checksum strum_macros 0.14.0 (registry+https://github.com/rust-lang/crates.io-index)" = "572a2f4e53dd4c3483fd79e5cc10ddd773a3acb1169bbfe8762365e107110579"
 "checksum substrate-bip39 0.2.1 (git+https://github.com/paritytech/substrate-bip39)" = "<none>"
-"checksum substrate-wasm-builder-runner 1.0.0 (registry+https://github.com/rust-lang/crates.io-index)" = "3533b62b476e5058947b9509038f9d5a72f7363a54a088821329fa76b990a485"
+"checksum substrate-wasm-builder-runner 1.0.1 (registry+https://github.com/rust-lang/crates.io-index)" = "131fa5f29b2a2e459f226411e4718ecda62e360123b7cfd76ae6a7da5bcaeb0d"
 "checksum subtle 1.0.0 (registry+https://github.com/rust-lang/crates.io-index)" = "2d67a5a62ba6e01cb2192ff309324cb4875d0c451d55fe2319433abe7a05a8ee"
 "checksum subtle 2.1.0 (registry+https://github.com/rust-lang/crates.io-index)" = "01dca13cf6c3b179864ab3292bd794e757618d35a7766b7c46050c614ba00829"
 "checksum syn 0.15.39 (registry+https://github.com/rust-lang/crates.io-index)" = "b4d960b829a55e56db167e861ddb43602c003c7be0bee1d345021703fac2fb7c"
diff --git a/substrate/core/executor/runtime-test/Cargo.toml b/substrate/core/executor/runtime-test/Cargo.toml
index 2315377485..4ad3446a91 100644
--- a/substrate/core/executor/runtime-test/Cargo.toml
+++ b/substrate/core/executor/runtime-test/Cargo.toml
@@ -12,7 +12,7 @@ sandbox = { package = "sr-sandbox", path = "../../sr-sandbox", default-features
 substrate-primitives = { path = "../../primitives", default-features = false }
 
 [build-dependencies]
-wasm-builder-runner = { package = "substrate-wasm-builder-runner", version = "1.0.0" }
+wasm-builder-runner = { package = "substrate-wasm-builder-runner", version = "1.0.1", path = "../../utils/wasm-builder-runner" }
 
 [features]
 default = [ "std" ]
diff --git a/substrate/core/executor/runtime-test/build.rs b/substrate/core/executor/runtime-test/build.rs
index b4c99eb6b7..67fc90b044 100644
--- a/substrate/core/executor/runtime-test/build.rs
+++ b/substrate/core/executor/runtime-test/build.rs
@@ -17,5 +17,11 @@
 use wasm_builder_runner::{build_current_project, WasmBuilderSource};
 
 fn main() {
-	build_current_project("wasm_binary.rs", WasmBuilderSource::Crates("1.0.1"));
+	build_current_project(
+		"wasm_binary.rs",
+		WasmBuilderSource::CratesOrPath {
+			path: "../../utils/wasm-builder",
+			version: "1.0.2",
+		},
+	);
 }
diff --git a/substrate/core/test-runtime/Cargo.toml b/substrate/core/test-runtime/Cargo.toml
index be6361fa00..8e9fc85a8a 100644
--- a/substrate/core/test-runtime/Cargo.toml
+++ b/substrate/core/test-runtime/Cargo.toml
@@ -31,7 +31,7 @@ substrate-executor = { path = "../executor" }
 substrate-test-runtime-client = { path = "./client" }
 
 [build-dependencies]
-wasm-builder-runner = { package = "substrate-wasm-builder-runner", version = "1.0.0" }
+wasm-builder-runner = { package = "substrate-wasm-builder-runner", version = "1.0.1", path = "../utils/wasm-builder-runner" }
 
 [features]
 default = [
diff --git a/substrate/core/test-runtime/build.rs b/substrate/core/test-runtime/build.rs
index b4c99eb6b7..d755768ee8 100644
--- a/substrate/core/test-runtime/build.rs
+++ b/substrate/core/test-runtime/build.rs
@@ -17,5 +17,11 @@
 use wasm_builder_runner::{build_current_project, WasmBuilderSource};
 
 fn main() {
-	build_current_project("wasm_binary.rs", WasmBuilderSource::Crates("1.0.1"));
+	build_current_project(
+		"wasm_binary.rs",
+		WasmBuilderSource::CratesOrPath {
+			path: "../utils/wasm-builder",
+			version: "1.0.2",
+		},
+	);
 }
diff --git a/substrate/core/utils/wasm-builder-runner/Cargo.toml b/substrate/core/utils/wasm-builder-runner/Cargo.toml
index 4122ca79eb..da21baf1d9 100644
--- a/substrate/core/utils/wasm-builder-runner/Cargo.toml
+++ b/substrate/core/utils/wasm-builder-runner/Cargo.toml
@@ -1,6 +1,6 @@
 [package]
 name = "substrate-wasm-builder-runner"
-version = "1.0.0"
+version = "1.0.1"
 authors = ["Parity Technologies <admin@parity.io>"]
 description = "Runner for substrate-wasm-builder"
 edition = "2018"
diff --git a/substrate/core/utils/wasm-builder-runner/src/lib.rs b/substrate/core/utils/wasm-builder-runner/src/lib.rs
index 0b1fb37896..4d77bde4d6 100644
--- a/substrate/core/utils/wasm-builder-runner/src/lib.rs
+++ b/substrate/core/utils/wasm-builder-runner/src/lib.rs
@@ -25,7 +25,7 @@
 //!
 //! For more information see <https://crates.io/substrate-wasm-builder>
 
-use std::{env, process::Command, fs, path::{PathBuf, Path}};
+use std::{env, process::{Command, self}, fs, path::{PathBuf, Path}};
 
 /// Environment variable that tells us to skip building the WASM binary.
 const SKIP_BUILD_ENV: &str = "SKIP_WASM_BUILD";
@@ -56,8 +56,13 @@ pub enum WasmBuilderSource {
 		repo: &'static str,
 		rev: &'static str,
 	},
-	/// Use the given version released on crates.io
+	/// Use the given version released on crates.io.
 	Crates(&'static str),
+	/// Use the given version released on crates.io or from the given path.
+	CratesOrPath {
+		version: &'static str,
+		path: &'static str,
+	}
 }
 
 impl WasmBuilderSource {
@@ -75,6 +80,15 @@ impl WasmBuilderSource {
 			WasmBuilderSource::Crates(version) => {
 				format!("version = \"{}\"", version)
 			}
+			WasmBuilderSource::CratesOrPath { version, path } => {
+				replace_back_slashes(
+					format!(
+						"path = \"{}\", version = \"{}\"",
+						manifest_dir.join(path).display(),
+						version
+					)
+				)
+			}
 		}
 	}
 }
@@ -87,9 +101,9 @@ impl WasmBuilderSource {
 ///               constant `WASM_BINARY` which contains the build wasm binary.
 /// `wasm_builder_path` - Path to the wasm-builder project, relative to `CARGO_MANIFEST_DIR`.
 pub fn build_current_project(file_name: &str, wasm_builder_source: WasmBuilderSource) {
-	generate_rerun_if_changed_instructions();
-
 	if check_skip_build() {
+		// If we skip the build, we still want to make sure to be called when an env variable changes
+		generate_rerun_if_changed_instructions();
 		return;
 	}
 
@@ -110,6 +124,10 @@ pub fn build_current_project(file_name: &str, wasm_builder_source: WasmBuilderSo
 		create_project(&project_folder, &file_path, &manifest_dir, wasm_builder_source, &cargo_toml_path);
 		run_project(&project_folder);
 	}
+
+	// As last step we need to generate our `rerun-if-changed` stuff. If a build fails, we don't
+	// want to spam the output!
+	generate_rerun_if_changed_instructions();
 }
 
 fn create_project(
@@ -164,7 +182,8 @@ fn run_project(project_folder: &Path) {
 	}
 
 	if !cmd.status().map(|s| s.success()).unwrap_or(false) {
-		panic!("Running WASM build runner failed!");
+		// Don't spam the output with backtraces when a build failed!
+		process::exit(1);
 	}
 }
 
diff --git a/substrate/core/utils/wasm-builder/Cargo.toml b/substrate/core/utils/wasm-builder/Cargo.toml
index 9a51d86eeb..7290e99279 100644
--- a/substrate/core/utils/wasm-builder/Cargo.toml
+++ b/substrate/core/utils/wasm-builder/Cargo.toml
@@ -1,6 +1,6 @@
 [package]
 name = "substrate-wasm-builder"
-version = "1.0.1"
+version = "1.0.2"
 authors = ["Parity Technologies <admin@parity.io>"]
 description = "Utility for building WASM binaries"
 edition = "2018"
diff --git a/substrate/core/utils/wasm-builder/src/lib.rs b/substrate/core/utils/wasm-builder/src/lib.rs
index eb71f0e386..31377b450f 100644
--- a/substrate/core/utils/wasm-builder/src/lib.rs
+++ b/substrate/core/utils/wasm-builder/src/lib.rs
@@ -78,7 +78,7 @@
 //! - wasm-gc
 //!
 
-use std::{env, fs, path::PathBuf, process::Command};
+use std::{env, fs, path::PathBuf, process::{Command, Stdio}};
 
 mod prerequisites;
 mod wasm_project;
@@ -156,8 +156,12 @@ fn create_out_file(file_name: &str, content: String) {
 
 /// Get a cargo command that compiles with nightly
 fn get_nightly_cargo() -> Command {
-	if Command::new("rustup").args(&["run", "nightly", "cargo"])
-		.status().map(|s| s.success()).unwrap_or(false)
+	if Command::new("rustup")
+		.args(&["run", "nightly", "cargo"])
+		.stdout(Stdio::null())
+		.stderr(Stdio::null())
+		.status()
+		.map(|s| s.success()).unwrap_or(false)
 	{
 		let mut cmd = Command::new("rustup");
 		cmd.args(&["run", "nightly", "cargo"]);
diff --git a/substrate/core/utils/wasm-builder/src/prerequisites.rs b/substrate/core/utils/wasm-builder/src/prerequisites.rs
index 965b45a701..d4b781495d 100644
--- a/substrate/core/utils/wasm-builder/src/prerequisites.rs
+++ b/substrate/core/utils/wasm-builder/src/prerequisites.rs
@@ -27,7 +27,12 @@ pub fn check() -> Option<&'static str> {
 		return Some("Rust nightly not installed, please install it!")
 	}
 
-	if Command::new("wasm-gc").stdout(Stdio::null()).status().map(|s| !s.success()).unwrap_or(true) {
+	if Command::new("wasm-gc")
+		.stdout(Stdio::null())
+		.stderr(Stdio::null())
+		.status()
+		.map(|s| !s.success()).unwrap_or(true)
+	{
 		return Some("wasm-gc not installed, please install it!")
 	}
 
@@ -83,6 +88,8 @@ fn check_wasm_toolchain_installed() -> bool {
 	let manifest_path = manifest_path.display().to_string();
 	crate::get_nightly_cargo()
 		.args(&["build", "--target=wasm32-unknown-unknown", "--manifest-path", &manifest_path])
+		.stdout(Stdio::null())
+		.stderr(Stdio::null())
 		.status()
 		.map(|s| s.success())
 		.unwrap_or(false)
diff --git a/substrate/core/utils/wasm-builder/src/wasm_project.rs b/substrate/core/utils/wasm-builder/src/wasm_project.rs
index 584b98a2a3..b460501e2e 100644
--- a/substrate/core/utils/wasm-builder/src/wasm_project.rs
+++ b/substrate/core/utils/wasm-builder/src/wasm_project.rs
@@ -14,7 +14,7 @@
 // You should have received a copy of the GNU General Public License
 // along with Substrate.  If not, see <http://www.gnu.org/licenses/>.
 
-use std::{fs, path::{Path, PathBuf}, borrow::ToOwned, process::Command, env};
+use std::{fs, path::{Path, PathBuf}, borrow::ToOwned, process::{Command, self}, env};
 
 use toml::value::Table;
 
@@ -266,7 +266,8 @@ fn build_project(project: &Path) {
 
 	match build_cmd.status().map(|s| s.success()) {
 		Ok(true) => {},
-		_ => panic!("Failed to compile WASM binary"),
+		// Use `process.exit(1)` to have a clean error output.
+		_ => process::exit(1),
 	}
 }
 
diff --git a/substrate/node-template/runtime/Cargo.toml b/substrate/node-template/runtime/Cargo.toml
index 16c58a5c38..9102ec5eb2 100644
--- a/substrate/node-template/runtime/Cargo.toml
+++ b/substrate/node-template/runtime/Cargo.toml
@@ -26,7 +26,7 @@ consensus-aura = { package = "substrate-consensus-aura-primitives", path = "../.
 offchain-primitives = { package = "substrate-offchain-primitives", path = "../../core/offchain/primitives", default-features = false }
 
 [build-dependencies]
-wasm-builder-runner = { package = "substrate-wasm-builder-runner", version = "1.0.0" }
+wasm-builder-runner = { package = "substrate-wasm-builder-runner", version = "1.0.1" }
 
 [features]
 default = ["std"]
diff --git a/substrate/node-template/runtime/build.rs b/substrate/node-template/runtime/build.rs
index b4c99eb6b7..96f2158ca3 100644
--- a/substrate/node-template/runtime/build.rs
+++ b/substrate/node-template/runtime/build.rs
@@ -17,5 +17,5 @@
 use wasm_builder_runner::{build_current_project, WasmBuilderSource};
 
 fn main() {
-	build_current_project("wasm_binary.rs", WasmBuilderSource::Crates("1.0.1"));
+	build_current_project("wasm_binary.rs", WasmBuilderSource::Crates("1.0.2"));
 }
diff --git a/substrate/node/runtime/Cargo.toml b/substrate/node/runtime/Cargo.toml
index 885d86e96e..6d11463834 100644
--- a/substrate/node/runtime/Cargo.toml
+++ b/substrate/node/runtime/Cargo.toml
@@ -39,7 +39,7 @@ serde = { version = "1.0", optional = true }
 substrate-keyring = { path = "../../core/keyring", optional = true }
 
 [build-dependencies]
-wasm-builder-runner = { package = "substrate-wasm-builder-runner", version = "1.0.0" }
+wasm-builder-runner = { package = "substrate-wasm-builder-runner", version = "1.0.1", path = "../../core/utils/wasm-builder-runner" }
 
 [features]
 default = ["std"]
diff --git a/substrate/node/runtime/build.rs b/substrate/node/runtime/build.rs
index db62153ea1..611775cd6e 100644
--- a/substrate/node/runtime/build.rs
+++ b/substrate/node/runtime/build.rs
@@ -19,6 +19,9 @@ use wasm_builder_runner::{build_current_project, WasmBuilderSource};
 fn main() {
 	build_current_project(
 		"wasm_binary.rs",
-		WasmBuilderSource::Crates("1.0.1"),
+		WasmBuilderSource::CratesOrPath {
+			path: "../../core/utils/wasm-builder",
+			version: "1.0.2",
+		},
 	);
 }