When it comes to creating custom software, many companies find themselves unsure of how much it will cost them. The answer to this question depends largely on the type of software that you want and how many developers you want to work on the project with you. In general, custom software development cost can be more than off-the-shelf software, but the price of each will vary based on several factors. Here’s an overview of how custom software development works and what goes into pricing your project so that you can be prepared to budget accordingly before you get started.
While it’s possible to find generic pricing guides online, these don’t take into account any variables specific to your project, like the size of your team, the complexity of your application, or the size of your budget. To get an accurate price quote, you should talk with at least two software developers and understand how they price their work before making a final decision.
Factors impacting software development cost margin
Custom software development cost is high, particularly for startups that are not yet well-funded. This type of business will struggle to afford software and may have no choice but to scale back its aspirations. However, despite these obstacles, there are still ways to cut down on costs without sacrificing quality or functionality. In fact, there are several factors that determine how much it actually costs a business to develop and maintain a particular piece of software.
Understanding what drives these custom software development cost factors can help you make better decisions when you’re developing your own piece of software. If we look at it from a different perspective, time also plays an important role in determining how much it costs to develop software. If you want to hire an offshore company with lower labor rates, then you’ll need to accept longer development times as part of your price tag. As such, if a developer tells you they can build something in four weeks and charges $10 per hour (with a standard 40-hour work week), then they should be able to produce exactly what they say they will at their quoted price.
The cost of hiring a freelance developer
Freelancers typically charge a rate based on their experience and hourly or daily rate. For example, a developer with seven years of experience may have an hourly rate of $60. In contrast, a software engineer with only one year of experience might charge half that per hour: $30 per hour. If you’re hiring a freelancer to work full-time for 40 hours per week, that equates to annual costs of $24,000 for the veteran developer versus just $12,000 for someone with less experience. It might be true you may get more work done by having an experienced developer on your team. However, it’s important to keep these costs in mind before you decide which candidate to hire.
Costs involved in building on top of an existing platform
The costs of building on top of an existing platform (e.g., WordPress, Drupal, or Magento) are often lower than creating a completely custom software solution. Platforms typically provide the underlying framework. And they can save you months (or even years) of work on core infrastructure, design, and maintenance. Keep in mind that there are trade-offs. While working with an existing platform means that you won’t have full control over your site’s look and feel or user experience. However, you may gain speed to market as well as reduced development costs. Additionally, using an existing platform means you may have limited flexibility to adapt as changes happen in your industry or marketplace. If you decide to build on top of an existing platform, it’s critical that you thoroughly research each option before deciding which one is right for your business.
Building your own app
Building a custom app is time-consuming and expensive. But if you can find a developer to work with, it might be cheaper than you think. Keep in mind that it’s not just about writing code, either. Before any lines of code are written, developers need to study your goals for your app. This way they can come up with a sound plan of attack. They also need to put together a project plan outlining how long each step will take and how much it will cost. The end result? A realistic budget for building an app without going over your budget (or taking forever).
In order to get a more detailed custom software development cost, break down exactly what you want your app to do and ask questions. These questions can be like: Will users be able to upload images or videos? Are you thinking about developing a custom app for your business? If so, keep these considerations in mind as you start planning out its features.
Remember: There’s no such thing as a small project—even small apps can become big projects fast! Start by defining your goal. What’s your ultimate vision for an app that meets all of these criteria? Is it something specific or broad enough to be useful for other people too? You should also set up parameters around when it needs to launch and what features are absolutely essential. Otherwise, it could turn into a never-ending endeavor. If there’s one tip we can offer here, though, it’s don’t underestimate how much work goes into building even a simple application.
What if you need to scale?
If you need to scale your software development, there are a number of ways to go about it. It depends on how you want to increase capacity. If adding people is easiest for you, an extra developer could reduce project costs per head by sharing overheads such as office space and tools. Alternatively, if your software demands more complex features than what a single developer can produce, then splitting up jobs among more developers will provide greater value for money. That’s because each developer is working on a different part of code and at their own pace, which ensures that everything comes together smoothly. Note that scaling up generally requires additional time and skill sets to take off; most companies invest in training new hires or outsourcing before they scale their team up.
Approximate investment required for different features
Every project has a unique set of goals, timelines, technologies and workflows. While all projects vary from one another, there are two main factors that determine how much any project will cost: team size and timeline. For example, developing software like QuickBooks Online would require a smaller team due to its already existing functionality. Whereas, custom software development requires an extensive amount of time since it isn’t based off of a pre-existing code or platform.
To summarize some quick budget breakdowns:
Approximate investment required for different features –
- Software Development Cost – Custom software development cost can range anywhere from $500 to $500,000 depending on complexity and specific requirements.
- Customization Cost – This includes anything non-standard or non-off-the-shelf e.g., new applications not available on public marketplaces (like iOS apps)
- Based on number of developers and timeframe
- Based on the number of developers
- Software design services range from $50/hour – $250/hour
- The number of designers also affects the price
- Based on the length & complexity of deliverables
- Number high level design concepts first so they can be iterated upon
- Depending on business needs – For instance, if company needs multiple products. If company is large-scale which includes hiring a team vs. contract worker
- Designing processes- Approval processes, tech stacks (including databases), estimation process and more.
No matter what kind of software development you’re considering, it can be hard to find an exact quote. There are just too many variables involved and each developer is in charge of their own pricing model. If you want a budget-friendly quote or a ballpark idea of what your custom software will cost, there are a few things you can do to get close. First, break down your project into its basic components and choose one that most closely resembles your needs. Next: create a rough estimate for how long it will take you to complete work on that component yourself with outside help if necessary.