This should be the first
question among all of those who plan to start their software project. It’s
critical to understand how much money is needed to invest in the product before
taking the first step. In this article, we explain what the key factors that
influence the cost of the end product are, we discuss the cost of staffing, how
much software agencies charge per hour, and what additional costs you may face.
We’ll also share with you our own method on how to prepare the estimates that
helps to develop an app without draining the budget.
What does the
development cost depend on?
Fact number one — apps
are created by tech talents. Different specialists in different parts of
the world charge differently for their services — that’s a
fact number two.
Talents and teams they
- First and foremost,
let’s define who make up the development team.
- Project managers, who
actually manage the development process.
- UI and UX designers, who
work on the way the product, will look like.
- Web developers —
frontend and backend, who are responsible for the product’s website and, if
it’s a web app, its functionalities, databases, CMS, etc.
- IOS and/or Android
developers, who actually code the app’s main features.
- A quality assurance
specialist, who test the product at each stage and make sure it’s bug-free.
- For every project, it’s
crucial to ensure the qualified and relevant tech specialists build the
product. Here are the most important qualities to look at while looking for
- Industry experience.
There’s a famous business quote — “If you think it’s expensive to hire a
professional to do the job, wait until you hire an amateur”. Different levels
of expertise in a particular area or technology often come with different
prices. Hiring people without the proper experience can be a big threat to the
whole project and a waste of time/money.
- Budget constraints.
Development companies usually have a wide price range. It’s based on their
experience, knowledge of business specifics or technical solutions they
provide. Prices also depend on the cooperation model, from the cheapest
approach (just tech hands: out staffing, staff augmentation), to project-based
work, and up to supplying tech solutions for specific business cases.
- Timeline. Team size,
specific team composition, experience — all of these have an impact on the date
of the project launch and the development timeline. The personnel doesn’t
always have to be located in one company or even on one continent! Some
companies (like Bunch Consulting) specialize in combining resources of
different tech staff to form the best possible team for a particular project.
It’s also crucial to use modern project management software.
The cost of your product
also highly depends on the hourly rates of the tech specialists you decide to
work with. “The more expensive, the better service” doesn’t always work. The
prices worldwide vary a lot, and they often depend on the agency or freelancer
location. Here are the average hourly rates across different world regions:
- US and Canada-based
companies’ hourly rates are from $50 to $250
- Australian companies
provide their development services for $50 to $150 per hour.
- UK-based and Western
European development agencies’ rates are between $90 and $170 per hour.
- Eastern European
companies offer their services for $30 to $90 per hour.
- Hourly rates in India
vary from $10 to $80.
- We live in a global
world and work in a global market. The location of the development team doesn’t
guarantee the quality of their services. Therefore, the location is not the
main issue. It’s more important to check what services an agency provides for
what rates and what their clients say about their cooperation.
Types of apps and their
- As we now know what the
hourly rates among different development companies are, it’s time to talk about
how much time it takes to create an app from scratch.
- Apps vary by their
complexity. The more screens and features an app provides, the bigger the
complexity of its logic. Naturally, the complexity increases the time needed to
develop an app, as well as its cost.
Apps can be divided into
- A simple app includes
only basic functionalities -. such apps don’t have third-party APIs
integrations and may not need a backend infrastructure and network connection.
Their features consist of standard UI components, ex.menu, navigation and
keyboard. Such apps require approximately 400–1,000 hours to develop.
- Medium complexity apps
are the ones that include custom UI features, in-app payments, integration with
third-party APIs, real-time chat, tablet adaptation, and a basic backend
server. It takes about 1,300 to 1,800 hours to build such an app.
- Complex time-consuming
apps are the ones with advanced functionality such as audio/video processing,
real-time synchronization, integrations with third-party services, complex back
ends with several types of database relationships, etc. The rough time frame
for creating a complex app is more than 2,000 hours.
- As we explained in the
previous parts of the article — time is money. However, there is much more to
the equation than simple multiplication of hours and hourly rate. Below, we
highlight the most important items on a typical “I want to develop an app”
- Third-party services.
You may need to integrate some ready-built features or services. They are
useful, as your development team wouldn’t have to build each feature from
scratch. However, it’s important to remember that some services are available
against a fee or commission (e.g. payments, maps, analytics, etc).
- Content management. If
you need a user-friendly admin panel to adjust or change the content in your
app, you’ll have to choose one of the CMSs. There are lots of those on the
market and in some cases, the paid ones are better for your project.
- Infrastructure services.
These are important for any medium or high complexity app. The costs would
include here data storage, servers, CDN (Content Delivery Network).
- Hosting and domain. This
is another additional payment that you should keep in mind especially when
creating web software. The type and size of a server should match your traffic
and services. The domain can also be a tricky one — sometimes it’s important to
be creative with branding not to overpay for it.
- Development tools and
libraries used. Some features require special tools to simplify and speed up
the development and you’ll need to pay for some of them.
How to prepare a rough
estimate for the project?
We now have a lot of
information about the factors development cost depends on. Though, how does one
transform all that info into an estimate? According to a “simple-to-complex”
basis, we start with a rough estimate and then discuss the details and
peculiarities to provide a more accurate quote. A preliminary estimate is not a
final quote, that’s just an approximate cost within a range of required
functionality. Let’s see how we work on that at Bunch Consulting.
First of all, we
estimate the minimum and the maximum number of hours needed to implement the
required features in your product. It’s important to see that range, even if
it’s a wide one, as here we start the negotiation.
Negotiation is important
as we discuss the business goals of your product and your expectations of how
it should work. By understanding your business goals, we can offer the best
solutions for the development and build up a perfect team for you.
When estimating complex
projects, we also suggest different tech solutions.. Sometimes, new technology
is necessary to achieve the best results. We also check if it’s more reasonable
to engage high-quality niche specialist or to estimate the time it would take
to research this technology implementation.
To make sure that we can
achieve the business goals and stay within the time and budget constraints, we
also propose the most effective ways for each project. Sometimes, it’s better
to start with an MVP or focus on a few key features rather than try to
implement many complex functionalities. It’s important to discuss requirements
and tweaks at the very beginning, so that we stay on the same page with the
Sometimes, a rough
estimate doesn’t fit the client’s expectations and that’s okay. In fact, a
preliminary estimate is a great start for discussing the project and
opportunities that we see in our collaboration. Each estimate is made
individually for each project, so we always do our best to find the best
solution for your project and business needs
It’s time to sum up. The
cost of app development depends on many factors. The complexity of the software
is extremely important. The tech team that is needed to build the product is
key for the estimate as well as and their hourly rates that depend on the
specialists’ experience and location. Additionally, there might be extra costs
depending on the type of app you need and the tech solutions required for it.
It’s easy to get lost between all of the numbers and factors. That’s why we
always prepare a rough estimate for the project and explain how much it costs
to implement different tech solutions.