Software Development Costs: Complete Guide for 2024

The cost of software development is a critical consideration for businesses planning to invest in digital solutions. However, the accurate cost estimate is complex and requires a thorough understanding of various factors. They include the type of solution, target platforms, a well-defined feature set, etc.

We used our personal experience in software development to help you navigate this process, and compiled a detailed overview of software development costs, along with an explanation of the key elements that influence the final price.

How much does it cost to build a software? On average, the price to build a business platform for different domains ranges from $40,000 to $500,000+. Let’s delve deeper into the details of the cost-forming peculiarities of software creation.

In our experience, mobile and web applications are the most demanded kinds of software. Let’s focus on them. As an example, the cost of software development varies depending on the complexity of software as follows:

Of course, the categories above are rather subjective. So we would like to provide you with the approximate cost of custom software development for different kinds of apps so you could see the whole picture. The prices are based on the average rate in our region (Central and Eastern Europe) — $50-$70 per hour.

In order to roughly count the software development price, it’s necessary to provide the company with some basic information about your project. For example, the business domain you'll develop your app in, will also influence the final price.

Below, we've provided rough project cost examples for some of the leading industries for you to consider.

• Healthcare - from 75,000 to 250,000+,
• Logistics - from 50,000 to 250,000+,
• Fintech - from 90,000 to 300,000+

In addition to business domain, when determining the cost of software development, we can generally ask you for the following:

• Idea. For example, you want to make an app like Tinder. So, you explain your idea to the company's technical specialists and they develop a Tinder-like MVP for you.
• Feature list. It’s important to discuss some vital features that have to be implemented. It’s also good to have the description of every feature (e.g. a map with pins, detect user's location etc.)
• Wireframes. The engineers would be grateful for your vision of design.
• Examples of the competitors’ apps or websites. Instances help you show developers what functions you adore and don’t like.
• Design. There can be just the ideas of what you like.
• Specification. (If you have one.)

At Cleveroad, we will always help your company to collect all necessary data. So you can just come up with the idea and we’ll do the rest.

The cost to develop a business platform for any domain is an essential aspect of any software development lifecycle. To mitigate risks of the project budget overrun, all the price-forming factors for your software creation should be considered and double checked beforehand.

The first factor that can change software development prices is the choice of platform. For example, you can develop a web app, or a mobile app for one or two platforms. The software development pricing quote will vary according to the platform.

The platform you choose will significantly affect the cost for overall development process. Below is a breakdown of estimated pricing ranges based on app complexity for each platform.

1 native mobile app (For both iOS and Android, multiply the cost by 2):

• Basic app: $10,000 - $25,000+
• Medium-complexity app: $25,000 - $50,000+
• Complex app: $50,000 - $100,000+

Web app:

• Basic app: $5,000 - $15,000+
• Medium-complexity app: $15,000 - $30,000+
• Complex app: $30,000 - $60,000+

Note: These are general estimates and actual costs can vary significantly based on specific project requirements, features, platform complexity, and other essentials.

You can also consider Flutter app development services to build software running on multiple platforms. Flutter allows you to invest in developing a single codebase that can be deployed across multiple platforms, leading to faster updates, improved consistency, and reduced time-to-market.

The type of software project also influences the average software development cost. There are three primary types of projects:

• Development from scratch: It involves creating a custom solution from scratch, tailored specifically to meet unique business needs. Its average cost ranges between $50,000-$250,000+.
• Legacy software modernization: This type includes upgrading and enhancing existing solutions for your business to improve functionality or performance. Your possible expenditures for software modernization services will be about $25,000-$150,000+.
• Integration of software: This entails integration of a new software with your existing business systems, ensuring seamless operation. The average cost for the ready-made solutions integration into your workflows will be $15,000-$75,000+.

Another crucial factor is the project size, implying the scope of work for your product building. This scope determines the number of hours required to complete the software development. The product development depending on the size of a project can cost from $40,000 to $300,000+.

The architecture of a software solution is essentially its blueprint, outlining how various components will interact and function together throughout the software development life cycle. A well-designed architecture can streamline development, but it often requires a significant upfront investment in planning and design.

Complex architectures, especially those involving microservices, demand more specialized expertise, increasing costs. Additionally, the need for scalability, security, and performance optimization further adds to the architectural complexity.

Integrations, on the other hand, involve connecting the software with existing systems, databases, or third-party services. This process can be time-consuming and challenging, particularly when dealing with legacy systems or multiple APIs that require custom coding. The more integrations required, the higher the software development costing, as each one adds layers of complexity and testing.

Let’s make an overview of the average costs associated with various architectural and integration factors with the help of the table prepared by our specialists.

The complexity of UI elements (e.g., custom animations, interactive features, and responsive design) can directly impact cost to develop software. For instance, complex animations might require additional programming effort and specialized tools. Similarly, designing for multiple devices and screen sizes adds layers of complexity, as each platform may have unique requirements.

To ensure a truly exceptional user experience, investing in comprehensive user research and testing is essential. This process involves creating prototypes, conducting usability tests, and iterating designs based on user feedback. Accessibility features to support users with disabilities might require additional development effort. Moreover, localization for different languages and cultural contexts can complicate the UI/UX design, adding to your expenses.

Thus, the average costs for UI/UX elements can include the following:

• Basic UI elements: $5,000 - $15,000+
• Medium-complexity UI elements: $15,000 - $30,000+
• Complex UI elements (e.g., custom animations, interactive features): $30,000 - $50,000+
• Responsive design for multiple devices: $10,000 - $25,000+
• Accessibility features: $5,000 - $15,000+
• Localization: $10,000 - $30,000+ per language

The need for ongoing updates and enhancements to keep the interface modern and user-friendly also contributes to higher long-term software development costs. Overall, the more customized and user-centric the UI/UX design is, the greater the investment required. However, this investment can yield significant returns in terms of user satisfaction, brand reputation, and overall business success.

The development process is another significant cost-driving factor for bespoke software development. The complexity and time involved in developing both the front-end and back-end components contribute to the average cost for software development.

• Front-end development involves creating the user interface and interactions that users see and interact with. Its average cost is about $10,000 - $50,000+.
• Back-end development means building the server-side logic that handles data processing, storage, and retrieval. It can cost from $20,000 to $100,000+.

The implementation phase is equally vital, as it involves deploying the developed software into the production environment where it will be used by end-users. This step requires meticulous planning to ensure that the software integrates seamlessly with existing systems and operates as intended. Implementation also includes configuring servers, setting up databases, and ensuring that all necessary security measures are in place.

We’ll discover the main implementation expenditures for your budget that include:

• Server configuration: Setting up and configuring servers to host the software. Its price ranges between $5,000 and $15,000+.
• Database setup: Creating and configuring databases to store and manage data. The average data setup cost is about $5,000 - $15,000+.
• Security measures: Implementing security measures to protect the software and data from unauthorized access, which can cost you about $5,000 - $20,000+.

Quality assurance services are extremely important for the development process. It’s vital to test every component of the software in order to prevent or solve any possible bugs. The cost of testing in software development varies significantly based on project complexity, scope, and the testing services required.

However, different industry estimates suggest that quality assurance can typically account for 15-25% of the total cost to develop software. This percentage can be higher for projects with complex requirements, stringent quality standards, or a high risk of failure.

The right technology partner brings expertise, resources, and a tailored approach that can optimize your budget. Understanding the key factors influencing pricing will help you make an informed decision and achieve your project goals efficiently.

Gathering a skilled and reliable development team may assist you to reduce software development costs, as you won't need to spend additional time and resources looking for new specialists.

Let’s outline key roles in a software development team, along with their primary responsibilities and average hourly rates.

Each role plays a crucial part in ensuring the success of the project, with responsibilities ranging from project oversight to hands-on coding and testing. Understanding the costs associated with each role helps in accurately estimating the overall project budget.

Cleveroad experts can provide you with individual specialists based on your specific requirements or offer dedicated development team services, giving you access to a full team of professionals. With extensive experience in software development, we ensure you have the right expertise to optimize software development pricing and accelerate the development process.

Software engineers are often divided into three categories by their knowledge, skills, and working experience. There can be junior, middle, and senior software engineers. The level of expertise you choose significantly impacts how much does software development cost, as senior engineers typically command higher rates due to their advanced skills and experience.

Junior developers. According to ZipRecruiter, the average junior developer’s salary can be from $24,000 for a year, but their limited skills and experience may require additional supervision and potentially lead to increased development time. This can ultimately affect the project's overall cost, as more time and cost resources may be needed to ensure the quality and accuracy of their work.

Middle developers. They can work on the project independently and deal with complex tech problems, having 1-3+ years of experience. As to Glassdoor data, these specialists charge from $84,000 yearly.

Senior developers. (Working for 5+ years and having the average salary from $128,507), they can provide you with the most effective variants for developing your project: different programming languages, how the feature should work to cause fewer bugs, etc. But be advised that these specialists can raise costs of software development significantly.

If you need any help in finding or interviewing software developers, contact us and we will assist you. By partnering with Cleveroad, you can benefit from our expertise in developer selection and ensure that your project is staffed with the right talent to achieve your desired outcomes.

Nowadays, there is a tendency for completely different rates on software development depending on a region. For example, the most expensive cost of software development services is in the US and Australia. However, such countries as Estonia provide qualified IT services for less money.

Let’s look through IT costs per hour from different regions.

Modern IT market provides quite a lot of opportunities for hiring a good software developer. The most popular and the most cost-effective ones are software development outsourcing and IT staff augmentation. Let’s discover the essentials you should know about them.

As you can see, both IT outsourcing and outstaffing models offer cost-effective solutions that can affect software development costs, enabling your business to choose the most suitable approach based on your budget and needs. Additionally, these models allow businesses to scale their teams flexibly, adjusting the workforce according to the project’s demands. Selecting the right sourcing model can significantly influence your development efficiency and overall project success for your business.

Beyond the initial development expenses, there are several other costs that can significantly impact your overall budget. Below is a breakdown of common additional costs to consider when budgeting for software development.

Feature creep refers to the unplanned addition of features during the development process, which can drive up costs and extend timelines. While it's difficult to provide an exact average, unexpected feature creep can often add 10-20% to the initial project budget, depending on the complexity of the added features and the stage of development at which they are introduced.

It’s essential to have a well-defined project scope from the start to mitigate these risks. However, flexibility can be beneficial when adding necessary features, as long as they’re properly accounted for in the budget. Ignoring feature creep can lead to delays and hidden costs that derail a project.

Software often requires hosting, server space, and databases, all of which come with ongoing infrastructure costs. Whether you use cloud services or on-premises servers, these costs can fluctuate depending on the scale of your software and its user base. As your user base grows, so too will your infrastructure needs, potentially increasing storage, bandwidth, and processing power.

Now, we’ll find out the average major costs associated with IT infrastructure expenditures:

• Hosting cost varies from $30 to $200+ widely based on server type (shared, VPS, dedicated), location, and provider.
• Server space depends on storage size (GB, TB) and type (HDD, SSD). It varies widely based on usage, but can be cost-effective for fluctuating workloads.
• Database cost varies based on database management system (DBMS), features, and storage requirements. This kind of expenses is included in hosting plans or can be purchased separately.

Cleveroad offers expert guidance and solutions for optimizing infrastructure costs during software development. Our team of experienced engineers can help you select the most cost-effective infrastructure options, implement efficient scaling strategies, and monitor resource utilization to avoid unnecessary expenses.

Security and compliance are some of the non-negotiable factors affecting software development cost in today’s digital landscape, particularly for industries like healthcare, finance, and e-commerce. For instance, if you are building Electronic Medical Records (EMR) system, ensuring your software complies with relevant regulations, such as GDPR or HIPAA, increases cost of EMR implementation due to audits, certifications, and security measures expenses. Building in data encryption, secure access controls, and regular vulnerability testing can further add to expenses.

Let’s revise the average expenditures to ensure your platform security:

Note: These estimates made by our experts can vary significantly based on factors such as company size, industry, geographic location, and the specific regulations and standards your software must adhere to.

Performance optimization involves fine-tuning the software to reduce load times, improve response times, and enhance overall efficiency. This may require additional development work, such as refactoring code or upgrading hardware to meet performance requirements. Although these optimizations may seem like an extra expense (performance optimization can typically add anywhere from 10% to 30% to the overall development costs of a software project), they prevent future issues like slowdowns or crashes, which can harm user retention.

Our team of experienced developers can help you optimize your software's performance without breaking the bank. We employ proven techniques (e.g., code and database optimization) to identify bottlenecks and inefficiencies in your code, allowing us to make targeted improvements that deliver significant performance gains without incurring excessive costs.

Cleveroad is a competent software development organization based in Central and Eastern Europe. Since 2011, we've been assisting startups and enterprises of all kinds in acquiring a wide variety of IT services and customized software products.

We have expertise in over 8 business domains, including key industries like healthcare, logistics, and fintech. Moreover, we are ISO-certified company, certified with ISO 9001 and ISO 27001 standards. They ensure the highest quality and security in our software development work. Our services include custom software development, IT consulting, legacy software modernization, and more, tailored to meet the unique needs of your business.

Now we’ll tell you about how we estimate software development price for your project. After you leave a request on our website, your personal manager (with experience in your business domain) will answer you within 24 hours to schedule a consultation for further project discussion.

After collecting all information, we prepare two types of cost estimation for you: Rough and Detailed.

A rough (or approximate) estimate is thought to be the most accurate amount. Its precision can range from 75 to 25%. This information should not be considered as a contract with set terms and conditions. It is given to a customer just for informative purposes.

We make two types of rough estimates:

1. The first one made after the Solution Design Workshop
2. The second one after the Discovery Phase

The Solution Design Stage rough estimation is made looking back on our experts’ previous experiences in similar solutions delivery. Our main goal is to determine the work scope, solution concept complexity, and also define possible pitfalls and challenges to start working on strategies to avoid them. Usually, we offer our client to choose three estimate variations: optimistic, realistic, or pessimistic. Depending on your choice we will understand how exactly to make an estimate: including all demanded features or just basic ones, to go in accordance with a budget and quality levels of non-functional requirements.

The Discovery Phase rough estimation is happening after the start of the Discovery phase. Here we create a more detailed features list, proceed with the business goals definition, determine possible development issues, and think more precisely of the architectural solution. This helps to correct the previous estimation and concretize the task and challenges for a development team.

When a customer is unsure whether or not they will collaborate with the software development team, this assessment is factored into the initial stage of the cooperation.

A detailed cost estimate is the most exact one in project management, with about 100% accuracy. It is carried out with the participation of developers who will be actively engaged in your software product creation.

Detailed estimates are based on thorough description of the forthcoming software platform, including wireframes, specs, and other documentation. Our managers will offer a thorough assessment within two business days if a customer approaches us with a ready-made paperwork package.