IT Outsourcing

App Development Costs in 2023: Cost breakdown

17 Jan 202313 min read

Marcin Kulawik

Marcin Kulawik

App Development Costs in 2023: Cost breakdown

Do you ever wonder how much it cost to develop a software solution? If yes, you might be among many people who struggle with that question. Without knowledge and experience in the IT industry (or sometimes even with it!) the estimation can be challenging to make. Therefore there is no shame in having no clue about this topic!

Nonetheless, do not neglect this question. The lack of insight into the cost topic can be very dangerous when thinking about or planning to develop software for your company. Market research proves that an overrun budget is one of the main reasons for failure, so this is no joke!

In this article, we will give ballpark costs, not exact estimations as it mostly depends on the project's scope. There are several factors to consider when securing your funds for software projects and we will discuss them in this article.

Application development costs in 2023

Recent studies report that sadly 45% of projects overrun budgets. Some say that even 17% of the bring risks of company failure. Those serious consequences bring fear and resentment towards investing in software projects. No wonder business owners hesitate when thinking about the digital development of their company, and in consequence, do not use great resources, which is custom software.

However, it does not have to be that way. Good preparation for the software development process is the key and, if done right, can solve most of the problems. Once you start thinking about investing in your project always bear in mind its costs and try to predict them as clearly as possible.

The general rule for costs is: smaller is less expensive. Simple applications mean minimal data gathering and processing as well as no requirements of 3rd party integration. Logically, less complicated software projects will require fewer hours and developers which equals a smaller price. It all depends on the size of the project and is hard to estimate without any details. A good solution would be to set the bottom line. You can start your project from $10k. On the other end, there is no limit to the top line. Some of the project developments go over $100k.

Here are some statistics predicted in 2023 and based on the patterns present in the last year to get a better grip on the price range.

Web and mobile applications development cost breakdown

Many factors influence the price of software development. It is quite expensive, but there is always a place to save money. Starting from the planning stage to maintenance mode there are ways to reduce costs. To plan where to cut we will provide you with a cost breakdown.

1. Business Analytics and research plans

It is the first stage of software development. It sets the app's target audience, all the requirements, design specifications or screen flow and lastly business goals. This takes around 10% of the main budget.

2. Code and app architecture choices

The cost of this segment consists of the salaries of the team members and technology choices. The longer explanation would list the technology stack, deployment requirements, level of customization of 3rd party tools and the scope of automated test coverage.

When planning the app's architecture, you and the team should consider the long-term costs of solutions and their licences. This way the costs will not surprise you in the future, therefore there will be less over budgeting.

3. App type and complexity

The complexity of the project influences its cost with a great impact. Complex software requires more time or resources, higher security levels and longer development cycles. The two main factors in this case are:

  • Domain niche requirements

If your app fits into a narrow niche, the complexity of your project rises. When you pick a field or a subject that is quite specific and unpopular, the making process of your project will require more individual experts. It will also be more time-consuming. Therefore, more expensive.

  • Complexity and scope of work

The most significant rule here is that the higher the price, the more user interaction there is. On top of that, complexity can mean that your software requires more customization. Having a custom solution requires your developers to spend more time on each part of the code and testers to check it more precisely.

4. Complexity Of UX/UI Design

User experience is the key to customer satisfaction. If the design is done poorly or the way the app navigates them is unpleasant, the users will quickly leave the app behind and never come back to it. The UX/UI Design is responsible for the graphic design of the usable features. Therefore it is obvious that to ensure the app's success there is much work required here and it has to be done with great attention to detail.

5. Geographic location

There is no doubt that remote work is a new standard. You can hire people from all around the world and do not have to rely on your local talent pool. However, the graphic location of the person or team you are hiring still matters. It could be an advantage for you, as well as cause some problems. It all depends on what you need and where you are looking for it.

  • The salary ranges

Developers’ salaries may differ depending on the location they are based on. The highest prices can be found in The US, then a bit lower rates can be found among Western European countries. Eastern European countries are one step down from their neighbours on the west side. Hoverer, the cheapest developers can be found in China or India. Diverse costs of living cause those differences in prices.

  • The Vendor

The prices also affect the range of resources the region has to offer. The US is known to have a great talent pool and easy access to development tools. Countries with comparable resources are UK, France and Belgium as they also provide highly skilled developers and do not lack in the technology stack. Eastern Europe is on the same level, the price difference comes from the contrasting living costs in those countries. Other East regions of the world tend to face problems such as difficulties in communication due to time differences or customs.

The salaries differ significantly and depend on many factors. With higher hourly rates for developers, the cost of your project grows. There is always some room to save, however, you have to decide your priority and balance your choice.

6. Hiring model

Hiring developers is the most expensive part of the software development process. It can take a significant part of your budget. Since there is more than one solution it is important to consider them all and choose accordingly to your needs and funds.

  • In-house

You can create a team of developers in your company and hire them as your employees. This gives you greater control and more accessible but requires greater money assets from you. Each new employee needs to be found and accustomed to your business. On top of that prices of employment have been growing in recent years. Therefore it may seem like the best idea, but it also is time and money-consuming.

  • Freelancer

You could also assign your project to a single freelancer or a group of them and still oversee the development but not invest in having them on board in your company. This may cut costs but also requires a lot of work from you as you have to manage the team or the person and control the workflow or the progress.

  • Outsourcing software development

It happens when you hire a third-party company to develop your software. By choosing this solution you can save up a lot on employment costs and be sure to have a team of experienced developers. Those companies usually provide their own project manager to support the work's effectiveness and help you with decision-making. On top of that, they usually have greater experience in project development as they worked with much more businesses or have easier access to a bigger talent pool.

4 ways to reduce software development costs:

Since investing in software development is so expensive, there is no reason to look for solutions that will save you some money in the process. To help you, we can point out a few important places you can reduce the cost:

  • Start with MVP

Creating a minimum valuable project can be a great way to test your software before finalizing the full version. MVP is a scaled version of your project with functional features. It is a great way to see what is working and what is not as well as saving some money when fixing problems.

  • Develop a Hybrid or Cross-Platform App

When creating an app, you are faced with whether you would like to run it on IOS, Android or both. If you create an app just for one system you may miss out on many customers and not meet your expectations. On the other hand, creating a different app on each of those platforms is hardly cost-effective. The best solution here is to create a cross-platform app that requires one-time work and runs on both places easily. A great example of cross-platform software is twitter.

  • Outsource app development to Eastern Europe

As we mentioned before Western European countries are a sweet spot in outsourcing. They hold very similar skills as the Western countries and there is almost no cultural or language barrier, but the prices are much lower due to the different cost of living there.

  • Do not apply changes to your requirements: plan your app carefully

Planning your application is the most important part of the project. There are many factors to consider when creating an initial plan. If it is done right they can save you a lot of money and time. Once the developers will know your expectations and goals right away, their work will be on good track from the start and there will be fewer chances to make mistakes during the process. However, once you try to change something in your plan it may slow down the work and cost you a lot of money to rebuild that part.

SolveQ approach to app development cost estimation:

Our main premise is to create tailored apps for businesses. We believe that each company is different and has distinct needs, wants and limits therefore there has to be a unique approach toward all, to maximise the project’s success.

We are easy to approach but if you are still unsure where to start a conversation with us here are just some steps you can follow:

  • Request

Contact us via email or pick an easier choice and send us a request by visiting our get in touch website panel.

  • Call

Give us a call at your convenient time, to talk everything through and communicate easier. You can present more details and get better feedback.

  • Creating a proposal with estimation, business analysis, and architecture design

At this point, we take the wheel and create your proposal. Our experienced team will work on all the critical factors that need to be considered and fix the documents to help you understand the process further.

  • Presentation call

Then we will have a chance to present you our proposal and estimations. There is always room for discussion and feedback is always welcome as useful information might be added on both sides.

Our cost estimation is based on technical and business analysis. SolveQ’s team members have great experience in project estimation as they choose the individual approach for each client.
If you are interested in developing your software and you are looking for an outsourcing company with great experience contact SolveQ and we will take care of the rest.

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Marcin Kulawik

Marcin Kulawik

Founder and CEO of SolveQ. Huge fan of building things with purpose, agility, and having fun while changing the World. Loves his family, teammates, and nature.