Software Development Costs

Estimates, Key Cost Factors, Cost-Cutting Measures

With the background of 35 years in software development and 4,000 successful IT projects, ScienceSoft is ready to provide the cost estimates for your project and take on the implementation.

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Software Development Costs - ScienceSoft

Contributors

Boris Shiklo

Chief Technology Officer, ScienceSoft

Andrei Dzimchuk

Senior Solution & Integration Architect, ScienceSoft

Andrei Mikhailau

Software Testing Director, ScienceSoft

Software Development Costs: The Essence

Software development costs for a medium/large application may range from $50,000 to $1,000,000. The total amount mainly depends on the number and complexity of software features and its design patterns. Also, such factors as the type of development (custom, low-code, or platform-based) and the team involved (their roles, seniority, and location) play an important role.

Key Cost Components of Software Development Projects

01.

Requirements engineering, UX design, and project planning

Costs: ~10% of the project cost

During this stage, the project team:

Analyzes the short and long-term company needs, existing processes and software.
Gathers functional requirements and plans software features.
Prepares UX design, which describes how users will interact with the system.
Creates the project roadmap, makes resource and budget estimates.
Assesses potential project constraints and risks.

To reduce project planning costs:

Make sure that you entrust requirements elicitation to experts. High-quality requirements are a solid foundation for the project’s success, while incomplete, inaccurate, or ambiguous requirements can result in process-blocking debates or even the solution redevelopment.

Ensure sufficient involvement of stakeholders and end users to better understand their needs and expectations. Disregard of their feedback at the earliest stages may result in the need to change requirements in the middle of development, and that would negatively affect the project costs and speed.

Involve a business analyst with real experience in your specific industry. Their knowledge of industry trends, challenges, and recent developments as well as the ability to speak the same language with the stakeholders are a game-changer at this stage.

Boris Shiklo

Chief Technology Officer, ScienceSoft

02.

Architecture and UI design

Costs: ~5-10% of the project costs

In the design phase, the team transforms the requirements specification into a structure that can be implemented using a specific tech stack.

We can divide design into two areas:

Technical design or software architecture design, which describes the software layers and modules, integrations among them, data structures used by different modules, and the required algorithms.
UI design, which describes what the software end users see.

To reduce architecture and UI design costs:

Explore the potential reusability of your legacy software. Often, we see that it is more cost-efficient and less risky to use some parts of our client's legacy enterprise systems than to develop and implement new software modules and integrate them with other enterprise systems.

If you can take a modular approach to software development and rollout, do it. You will be able to launch new functionality faster and cause far less disruption to your everyday processes. It will also be easier to evolve the software consisting of loosely-coupled modules.

Use ready-to-go UI templates unless a unique interface is your competitive advantage.

Andrei Dzimchuk

Senior Solution & Integration Architect, ScienceSoft

03.

Software coding

Costs: back-end development – ~40% of the project costs; front-end development – ~25% of the project costs

Back-end developers write server-side code and APIs and conduct unit tests. Front-end developers turn static user interface mockups provided by UI designers into fully functional GUIs.

To reduce software development costs:

Establish development and delivery automation environments (CI/CD, container orchestration, etc.). A professionally implemented CI/CD process helps integrate, test, and deploy new software functionality within 2-3 hours and reduces development costs by up to 78%.

Consider low-code development. This approach helps make software development process up to 4 times cheaper and 10 times faster. A low-code application platform (LCAP) is currently the most popular low-code development technology. LCAPs (e.g., Microsoft Power Apps, OutSystems, Mendix) provide visual drag-and-drop modules that simplify and streamline building new apps.

Use ready-to-use cloud services for storage, event processing, integration, data management and analytics, ML, monitoring, and more.

Boris Shiklo

Chief Technology Officer, ScienceSoft

04.

Quality assurance

Costs: ~15-20% of the project costs

The team checks if the software meets the specified functional and non-functional requirements and reports on the revealed defects, if any. Although we list QA as a separate stage here, it often runs along with the development, and the most effective QA runs throughout the SDLC: from requirements gathering to software maintenance.

To reduce QA and testing costs:

Consider test automation. If it’s feasible, it can reduce testing cost and time by 20%.

Shift QA left as much as possible. The cost of fixing defects is much higher than the cost of preventing them.

Andrei Mikhailau

Software Testing Director, ScienceSoft

05.

Software deployment

Costs: depend on the services to be provided during the stage

At this stage, the team makes software available for use. This may include installation, customization, user acceptance testing, creating user guidelines, and user training.

ScienceSoft

06.

Software support and maintenance

Costs: ~15-20% of the original development costs yearly

Once the software is launched, it will require routine maintenance from either a dedicated support team or the original developers. This includes fixing bugs that surface after the software gets delivered to the end users, handling the changing requirements, optimizing the software and its infrastructure for better performance, scalability, cost-efficiency, closing security gaps (if any), and more.

To reduce software costs at the maintenance stage:

Continuously identify the smallest resources needed and terminate the unused capacity.

Track the unused services and terminate them if they’re not needed any more.

Consider your cloud provider’s pricing models: maybe your app satisfies the requirements that would allow using cloud resources at a significant discount. E.g., with Reserved Instances from Azure or AWS, you can have cloud fees reduced by 72-75% if your demand for computing resources is unlikely to decrease within the commitment period.

Boris Shiklo

Chief Technology Officer, ScienceSoft

Key Cost Factors

Based on ScienceSoft’s experience in software development, we have defined the major factors that may influence a project’s cost:

App-related factors

Application type (web, mobile, desktop).
The number of platforms and OS versions supported (for mobile apps).
The number and complexity of application features.
The number of business functions covered (finance, SCM, production, HR, CRM, etc.).
The number of business processes covered (e.g., for sales and marketing: email marketing, lead nurturing, ad campaign planning and analysis, etc.).
Software performance, availability, security, latency, and scalability requirements.
The number of users and user roles.
The complexity of the application logic and architecture (the number of tiers, the number of modules, on-premises/hybrid/cloud-native/cloud-only, etc.).
The number and complexity of integrations with other software (one-way/two-way integration/a shared database; a custom integration solution or a ready-built ESB).
Advanced techs used (machine learning capabilities, AR/VR, etc.).
The need to migrate data from legacy software.
Regulatory compliance requirements (PCI DSS, HIPAA, GDPR, GLBA, etc.).
The uniqueness and complexity of UI design.

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Development-related factors

The team involved (their roles, number and seniority).
The approach to development, e.g., writing custom code from scratch, using low-code development platforms, using ready-built products to cover some parts of functionality.
The sourcing model.
The location of the outsourcing vendor (if any).

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Want to Ensure the Economic Feasibility of Your Software Initiative?

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Sourcing Models for Software Development Projects

In-house software development

Direct supervision over the development process.

All sourcing and management efforts are on your side.
No quick on-demand access to specific competencies.

Turn to ScienceSoft for help with software and project planning, defining skills gaps, etc.

Turn to us

Outsourcing of dedicated teams

Vetted, pre-built teams for quick project start.
Pay-as-you-use approach.

Project and quality management are partially or completely on your side.

Turn to ScienceSoft if you need a professional software development team.

Turn to us

Outsourced software development

The vendor is responsible for team arrangement, development process, and its results.
Cost-effective due to the vendor’s established processes.

Risk of choosing an inept vendor.

Turn to ScienceSoft if you need a reliable and proactive provider to plan and deliver your software.

Turn to us

Sample Software Development Project Costs

Software complexity

Simple

Medium

Complex

Approximate hours

~500–700 hours

Software with simple features and basic design without any integrations

~700–1,200 hours

Software with more complicated functionality and a highly animated interface, developed in the Agile environment

>1,200 hours

Software with complex architecture, high security requirements, various integrations or implementation of advanced technologies (such as AI), etc.

As a project requires a team consisting of various roles whose hourly rates may differ, we share the ballpark estimations for different types of apps:

~$250,000

An ecommerce portal for the mid-market (platform licenses and content costs are not included).

~$250,000–$400,000

Inventory software for a large enterprise.

~$200,000–$400,000

Operations management software of average complexity.

~$800,000–$4,000,000

Big data solution with AI and ML.

~$300,000

Digital process automation solution.

~$200,000–$400,000

Automated accounting solution of average complexity.

$30,000–$70,000

A native mobile app of medium complexity (field service, booking and ticketing apps, mCommerce).

$150,000+

A mobile banking app / mobile telehealth app.

Want to know how much your software will cost?

Our team will be happy to provide a cost estimate for your case.

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*The estimates provided are not ScienceSoft's official pricing/rates for the software development projects. We calculate the cost of each project individually, based on our clients' specific situations and needs.

How Much Will It Cost to Develop Your Software Solution?

Please answer a few questions about your software development needs. This will help our team provide a tailored service offering and a cost estimate much quicker.

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*What type of company do you represent?

An organization looking to develop software for internal use

A software product company developing software to be distributed commercially

An innovative startup

*What is the expected number of software users?

1-10

10-100

100-500

500-1,000

1,000-10,000

10,000-100,000

100,000-1,000,000

1,000,000+

Please specify the data sources for your data analytics solution.

Internal data sources (e.g., ERP, CRM, SCM).

External data sources (e.g., weather data, competitor prices, market data, social media).

*Should your solution offer complex analytics?

Predictive analytics (e.g., for demand forecasting, predictive maintenance)

Prescriptive analytics (e.g., for process optimization, personalized suggestions, automated actions)

Complex reports (e.g., consolidated reports, industry-specific reports for local regulators)

Basic analytics capabilities only (calculation of historical metrics)

*What is the aim of your software? What capabilities should it provide?

Will your dating focus on a specific niche (people with specific interests, lifestyles, or demographics)?

Yes No

What is your target niche?

*What is the idea behind your future dating app?

*Do you have tech stack preferences?

Here, you can add any details you'd like to include.

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How to Start Getting Value from Your Software Sooner

Go for an MVP (minimal viable product)

At ScienceSoft, we often start with identifying and delivering a basic set of features which meets the key needs of end users (=MVP). Usually, an MVP can be ready in 3–6 months. So, you can start selling the new software or enjoy streamlined business process in a very short time. After an MVP is launched, you can continue evolving it, gradually adding more features and addressing user feedback.

Ensure good user trainings and guidelines

With proper trainings and guidelines, your clients, employees, or partners will onboard quicker, engage with the software more actively, and use the maximum amount of its benefits.

About ScienceSoft

ScienceSoft is a US-headquartered provider of software development services with offices in Europe and the Gulf Cooperation Council. Our pool of 750+ IT professionals includes PMs, BAs, data scientists, security, QA, and DevOps engineers. We build reliable and efficient web, mobile, and desktop applications, B2C/B2B portals, large-scale enterprise applications and SaaS products, BI solutions, big data and IoT applications. The quality of the delivered services and the security of the customers’ data are backed up by ISO 9001 and ISO 27001 certifications.