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Software Development Company Pricing Guide 2024

Updated February 2, 2024

Experienced software developers can help you create a software solution that meets your needs and fits within your budget.This software pricing guide can help you make informed decisions when hiring a development company and ensure you are making the most cost-effective decisions.

Developing custom software is no small task; doing it right is essential to the success of the product and your business. Hiring a software development company can ensure that your business gets the product it needs—whether that is to sell your software or to develop a program to improve your internal operations.

It can also save your business time and money in the long run. By investing in your software development upfront, you can avoid tedious and costly tasks needed to update your program. You may even prevent your team from having to replace the product in the future by creating a solid product now.

Here’s what you need to know about how much it costs to hire a software development company for your project.

Custom Software Development projects reviewed on Clutch typically cost

$10,000 - $49,999
< $10,000 $10,000 - $49,999 $50,000 - $199,999 $200,000 >

Generally, developing custom software can be a costly process. As seen in the chart above, however, the price of developing custom software ranges. The cost of the project may vary depending on the type of software being developed as well as the complexity of the project.

Some of the key cost components of a software development project are in the project planning, architecture & design, coding, QA, and deployment phases. All of these project milestones can make up costs in various ways, so hiring a professional software development team can organize the project efficiently.

Many business leaders choose to build custom software solutions in order to gain an edge over their competitors or to solve unique problems that their business faces. While the price is often more expensive than off-the-shelf solutions, many businesses find that the benefits of developing a bespoke solution far outweigh the costs.

As most software developers charge an hourly rate for their services, the cost of the project often depends on your development needs and how long it will take for them to complete the project.

Get software development quotes fast! Scope requirements and request pricing info from multiple companies all at once.

How Much Does It Cost To Hire A Software Development Company?

Software development companies listed on Clutch charge an average of $24–$49 per hour. This rate may depend on the expertise of the software development team, how many people are working on the project, the location of the development team, and the requirements for the project. 

When talking to a software developer about their rates and the cost of a project, it’s important to clearly describe your project and what you’re hoping to accomplish. With this in mind, they will be able to provide an accurate estimate for the cost of your project.

Software Development Pricing Models

Like with other collaborative efforts, some software development teams work off pricing models that cater their teams and workflows.

  • Hourly Software Development Pricing Model: As mentioned throughout this pricing guide, a lot of software development companies charge based on hourly rates for software development projects to provide flexibility with evolving requirements. 
  • Fixed Software Development Pricing Model: A fixed price model stands on the agreement between a business and a software development company on a predefined set of requirements at a predefined price. 
  • Time & Material (T&M) Software Development Pricing Model: This software development pricing model focuses on agility and project changes that are based on an hourly rate structure. 
  • Dedicated Team Software Development Pricing Model: Having a dedicated software team that works only on the client’s project. This model gives the client more control 

Common Tech Stack Components for Software Development

According to data collected on Clutch, software development companies tend to charge a similar hourly rate no matter what technology they use to produce a product. This means that a software developer that uses Java, will likely charge about the same as one who uses C#.

However, when looking to hire a software development company for your project, you may want to search based on what types of technology they work with and what they specialize in.

What is a Tech Stack?

A tech stack is the combination of the different types of technology that a development team uses in order to build the software or app. This can include:

  • Programming languages: a system of notation for writing computer languages. Each language has its own rules, syntax, and structure.
  • Software development kits (SDK): a set of software development tools that are usually created to help developers build apps for certain platforms or operating systems. They can include programming languages, APIs, code samples, libraries, documentation, and more.
  • Frameworks: Software frameworks are platforms that help developers build software applications using shared resources such as libraries, image files, and reference documents. Similar to a template, they can be modified using code. 

In addition to determining what type of software you will be building, the tech stack will impact what functionality you can implement in the product and the platform’s maintenance down the line. If you plan on maintaining the software yourself, it’s better to choose a tech stack your internal team is already familiar with.

Types of Software Systems

Before deciding on the tech stack, companies need to factor in what type of custom solution they’re building with software development pricing.

  • CMS (Content Management System) - includes content editing tools & plugins, making it SEO-friendly and scalability for blog style projects. 
  • CRM (Customer Relationship Management) - these systems incorporate a variety of tools that help businesses keep track of their customers and manage their relationships. This software can be built based on unique specifications, making the ideal number for software development pricing vary. 
  • ERP (Enterprise Resource Planning) - built to manage daily operations for businesses like accounting, project management, supply chain, etc. Having a software ERP system tailored to your needs is critical for businesses looking to sell a product. 
  • E-Commerce: these software systems allow businesses to promote and sell their digital and physical products and work as an online store. Some of these software projects have a level of complexity due to the uniqueness customers are looking for.

Popular Developer Technology

Here are some of the most popular tech options that software developers on Clutch offer:

Tech Stack
Components
Description
Platform/Product
Average Hourly Cost
.NET is an open-source developer platform that provides multiple languages editors, and libraries.
  • Cross-platform
  • Web
  • Mobile
  • Desktop
  • Game
  • IoT
$25–$49
Java
Java is probably the most widely used programming language for web, mobile, and desktop applications. Because of its popularity there is a vast library of existing code for developers to source from. 
  • Web
  • Mobile
  • Desktop
$25–$49
Flutter
Flutter is a mobile SDK that uses a reactive programming language called Dart. Its hot reload feature lets developers quickly make changes to an app without disruption. It’s also an open-source programming language.
  • Web
  • Desktop
  • Cross-platform 
$25–$49
Laravel
Laravel is an open-source PHP framework. It has strong security features and is simple to use. However, there is limited support and requires frequent updates. 
  • Web
$25–$49
ASP.NET
ASP.NET is an open-source framework that runs either C# or VB.NET
  • Web
  • Mobile apps
  • Cross-Platform 
$25–$49
Microsoft SharePoint
Microsoft SharePoint is a development platform specifically for SharePoint frameworks, SharePoint Add-ins and farm solutions. It’s great for building 
  • Web
$25–$49
Unity
Unity is a game-development platform that can be used to develop 2D, 3D, and AR/VR games.
  • Cross-platform
$25–$49
C#
C# is a programming language that can be used to build applications in .NET ecosystem. It can be used for web development, Windows apps and, when combined with Unity, game development
  • Web
  • Desktop apps
  • Games
$25–$49
Go
Go (aka Golang) has increased in popularity recently because it has a simple structure and syntax. It’s easy to learn and can be used across platforms. However, there is very little library support, so coders often have to write more code than they would in other languages.
  • Cross-platform
  • Primarily Desktop
$25–$49

Note: Price ranges above are in U.S. dollars.

What Impacts The Cost of Hiring A Software Development Company? 

If you find that the estimates that service providers are providing are out of your budget, you may need to address factors that could be impacting the cost of your project. For example, a more expensive cost estimate may mean that you need to limit the scope of your project. Alternatively, you could work with an off-shore team that charges lower hourly rates.

Here are a few factors that may be impacting the cost of your software development project.

  • Type of Software and complexity
  • Custom Software
  • UX/UI Design
  • Backend Infrastructure
  • Location

Type of Software and Complexity

Like any project, some types of software are easier to develop than others. How much a software development company will charge for their work depends on the complexity of the project.

Some development projects are considered simple to build because they don’t require a lot of features, have been done before, or and have few interconnected elements.

Often, using open-source software (OSS) can make the development process easier. Open-source software is released under a license which allows other developers to use and alter the source code. With a lot of the code already written, using open-source code can speed up the development process.

More complex projects, however, take longer because the code needs to be customized. Even if there is available open-source code, developers may need to alter the code or write additional code to meet project requirements. In addition to more advanced coding, some projects require complex algorithms, various integrations, larger tech stacks, and intricate backend processing.

Custom Software

To determine how much it will cost to build your custom software, discuss your requirements with a service provider. They will be able to provide a rough estimate of what it will cost to build all of the features you need to meet your goals.

Here are some common types of software that businesses may hire a software development company to build:

  • ERP Systems: Enterprise resource planning systems help businesses manage daily operations such as supply chain management, project management, compliance, and even accounting.
  • Supply chain management: Supply chain management solutions help organize suppliers, vendors, retailers, distributors, and producers. For businesses that have to oversee everything from raw materials to finished goods, a customer supply chain management solution is absolutely necessary.
  • SaaS: Software as a Service tools use cloud computing to provide services to online users. The software providers host the application in its own servers, databases, or network, but it can be accessed by users through the cloud.
  • CMS: Custom content management systems help companies create and update content such as blogs, press releases, and other types of content.
  • CRM: Customer relationship management systems help businesses push potential customers through the sales funnel. They often include workflow automations, task management features, reports and dashboards to track sales, and much more.
  • Artificial intelligence (AI) and Big Data: Using machine learning and artificial intelligence, companies can automate various processes and improve the efficiency of their business.
  • Internet of Things (IoT): IoT describes a network of software, hardware, sensors, and other types of technology. By connecting these features to create an IoT infrastructure, developers can collect and process data for real-world applications. This, like AI, makes it a great way to streamline business processes.

Of course, these aren’t the only software development options. What you can accomplish with custom software is practically limitless. Whatever your business needs to achieve its goals more quickly and efficiently, you can develop a custom software solution with the right provider and appropriate budget.

UX/UI Design

The user experience (UX) and interface (UI) are essential to the usability of the platform. While the user interface is usually designed by UX/UI designers, software developers are put in charge of executing the design.

The UX/UI design process includes navigational elements as well as graphical designs, such as buttons, icons, and colors that contribute to the usability of the software. Without a solid UX/UI design, users can easily be frustrated by navigating the platform. This, in turn, can hinder both the internal use and commercial success of the software.

Despite the focus on simplicity in UX/UI design, the software itself still needs to be able to have all of the features and functionality that are required by the project scope. Because of this, a simple UX/UI can be far from simple to execute. In fact, over-simplified products can provide poor user experiences.

Keep in mind that more complicated products often have more features and are more difficult to develop. Software developers have to dance a fine line between delivering the look and feel that they’re aiming for and functionality.

The design of the platform may impact the overall cost of the project.

Backend Infrastructure

Backend development is essential to ensuring the functionality of the platform since it is responsible for all server-side functionalities.

This part of the development process is often complicated and time-consuming. Depending on what you hope to include in the backend of your software, a software development company may increase their rates to reflect the complexity of their work.

Some software solutions and apps require connection to external systems and backend processing that can impact the cost of a software development project. This can include features like geolocation, mapping, payment options, and connected Application Programming Interfaces (API). More complicated platforms require developers with more experience, who often charge higher rates.

Additionally, complex software requirements may take longer to implement without bugs. Requiring more hours of work, the cost of the project overall will increase as well.

Nevertheless, the backend infrastructure is the backbone of the software and is essential to the functionality of the program, regardless of what you’re trying to accomplish through the development project.

While the complexity of the backend infrastructure may increase the overall cost of the project, it’s well-worth the cost to get the results you’re looking for.

Location

Rates may also vary depending on the location of the software development team. The cost of hiring a software development company in the United States and Western Europe, for example, is significantly higher than in Eastern Europe or Southeast Asia.

To reduce costs, many business leaders choose to work with an off-shore development company, meaning that they work with companies in other parts of the world. These companies use remote work tools, such as Zoom, and other project management tools to collaborate with their clients.

Read, ‘How to Choose Between Nearshore and Offshore Outsourcing.

While communicating with companies in other time zones may sometimes be difficult, many business leaders still choose to hire teams from other areas knowing that they will still receive a high-quality product for a more affordable price.

Check out how hourly rates for software development companies vary depending on location.

2024 Custom Software Development Pricing by Location

Browse hourly rates for Custom Software Development companies by popular locations.

CountryAverage Cost per Hour
United States of America$100 - $149
India<$25
United Kingdom$50 - $99
Canada$100 - $149
Australia$100 - $149
Phillippines$25 - $49
Ukraine$25 - $49
Poland$50 - $99
Spain$25 - $49
Mexico$25 - $49

* Countries ranked by Clutch traffic

Build Custom Software Solutions Without Breaking The Bank

Ultimately, the cost of developing a bespoke software solution for your business depends on what type of software you’re trying to build, the complexity of the project, and the hourly rate of your software development team.

Although producing a high-quality software product should be your first priority, keeping your project within your budget is necessary for your business’s success.

When asking software developers for quotes on a project, keep in mind that these factors could be influencing the overall cost of development.

Discover the leading software development companies on Clutch.

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