Custom Software Development Cost Breakdown Aspects in 2024

By RisingMax

July 10, 2023

Custom Software Development Cost Breakdown Aspects in 2024

Every business, entrepreneur, or individual looking to launch a digital solution is interested in knowing the custom software development cost. Are you also wondering about the custom software development cost and its breakdown depending on various factors and industries? Well, you are at the right place. The short answer is it costs around $30,000 - $100,000. But why is there so much difference between in the cost range? 

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Software Development Cost

When you got to work today, how long did it take you to get there? Is it certain that getting there tomorrow will take the same amount of time? No, I doubt it. The amount of time necessary will vary depending on your route, traffic, weather, and a slew of other factors. The change could be minor over a short distance. However, if you have to go to a different city or nation, your expenses can skyrocket.

Your commute time, on the other hand, is entirely your responsibility. Accurate time/effort calculations are significantly more important in any professional activity where a large number of other people or processes rely on your ability to complete things on time.

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According to several sources, software engineering is one of the top services handled by outside contractors and custom software development company, with global contract values ranging from $63.5 billion to $159.1 billion. Knowing the projected time/budget before the commencement of any collaboration is critical for firms in this situation. Hiring a contractor or an agency without a clear understanding of the cost-benefit analysis would be a risky proposition.

Software engineering, on the other hand, is a difficult field of study. It frequently necessitates substantial investigation and novel solutions. As a result, making any assumptions about the average cost of custom software development or the length of one or more engineering tasks is extremely dicey.

We do 30-40 estimates per month on average for how much it costs to outsource software development and totaling 500 estimates per year. We have established our own way of quoting software engineering work as a result of our extensive experience in this field. We discuss all components of the software development cost estimation process, as well as the approaches we normally employ, in this document. But first, let's describe the estimation of the custom software development cost in the software development life cycle.

Factors Impacting Custom Software Development Cost

In my personal opinion, there are several custom software projects falling in the $30,000 - $100,000 in order to design and develop the application. 

App Size

Software SizeNo. of ScreensDevelopment Cost
Small Application10-25$25k - $50k
Medium Application25-40$50k - $80k
Large Application40+More than $100k

We all are aware that small applications range from 10-25 screens, 25-40 screens are there in the domain of medium ones, and more than 40 in large applications.

In general, the cost of small applications may vary from $25 to $50k, whereas medium applications cost around $50 - $80k and the larger applications are up to $100k. 

App Complexity

As previously said, the cost is mostly determined by the scope of your software project. Of fact, there is no common metric for dividing software into small and large products, but we can roughly categorize the software products our team works on based on our expertise. So here are three different project sizes:

Basic Project:The most basic, simple undertakings are the first category of projects. Landing pages, small eCommerce stores created using engines like WooCommerce or Shopify, and small (4 to 5-page) websites are examples of these. These don't necessitate a lot of custom software development and there's usually very little custom design involved. They don't use third-party integrations or other add-ons, either (cloud, databases, etc.).

These are the quickest and least expensive projects to construct, and the team will include a designer, one full-stack developer, or two developers (one for frontend and one for backend), and a project manager. Quality Assurance is typically significantly less involved and contributes little to the overall project cost.

Slightly Complex Projects:Moderately complex software projects are the next level of complexity. Web apps, cross-platform mobile apps, and so forth are examples. Unlike the basic project category, there is more bespoke design involved, and the UI and UX receive more attention. There are frequently a few third-party integrations (such as payment processing) involved as well.

A UI/UX designer, two or three developers, a project manager, and a Quality Assurance specialist will most likely make up the team for a product like this. Depending on the IT consulting companies in NYC you can deal with a business consultant or hire to assist in the creation of a detailed project strategy and the definition of critical features.

Immensely Complex Projects: Finally, there are items that are quite sophisticated and have numerous features, screens, and other components. Native mobile apps with custom design, development, and many third-party integrations, as well as high-complexity cross-platform mobile, web, and desktop apps, are among them.

This type of product has a broad reach and a big list of features. For a project like this, the team will typically consist of two UI/UX designers or a separate UX designer and UI designer, a researcher, more than three engineers, and at least two quality testing specialists. This project will most likely take more than 6 months to complete and depending on its intricacy, it could take years.

Basic Project$10k to $20k
Slightly Complex Projects$20k to $50k
Immensely Complex Projects $80k to more than $100k

Over here, the complexity completely depends on the extra time taken for coding and the final testing of the application. For instance, if the application tends to have a lot of heavy analysis, the crunching of numbers, or scoring, or there is the involvement of some secret sauce consisting of a lot of permutations and alterations. Then you can easily assure that your application has been verified on the terms of complexity. In fact, complex software projects can easily cost up to more than $20,000 as well. 


Well, the answer to your question “how much does custom software development cost?” depends greatly on the region of the software development company. A software developer charges more per hour cost in the USA than in India or Southeast Asia. For this very reason, most entrepreneurs and established organizations in USA, UK, and Europe, hire offshore software development companies.

>RegionSoftware Development Cost
USA$90-$100 per/hour
UK$80-$85 per/hour
Europe$70-$80 per/hour
Australia$60-$70 per/hour
India$40-$50 per/hour

Software Type

The estimated software development cost depends greatly on the business type and perfectly answers the question, “how much does custom software development cost?”. Every industry has challenges that need to be addressed effectively via a software solution. A software development company considers challenges associated with various industries and quotes a software development cost based on the same.

Education Software Development Cost:Based on the features and functionalities, the basic educational software or app can be prepared for about $50,000. If you want it to work on both iOS and Android platforms, the educational software costs between $40,000 and $60,000. However, the final cost may be slightly different from the above amount, depending on the number of additional advanced features you want the developer to build. 

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Automotive Software Development Cost:The software development cost for the automotive industry lies between $30000 to $60000. If we go with agile methodology, the average hourly rate would be ~$25 per hour. 

Migration or Calling Existing Data:Every application has the challenge to be unique in its own way. And to acquire this challenge many companies put extra effort to figure out the scripts, translation rules, and many rounds of tests and adjustments. This will automatically add up the cost of the project and that would be on an hourly basis as well. Giving you an estimate of the cost on an hourly basis could be $15 to $25k. 

Healthcare Software Development Cost:There’s no universal way to find out the software development cost for the healthcare industry. The important thing is that your application solves your business problems and brings value to your customers. You can execute a project with a full-stack engineer for only US$20,000, or you can join a 40-person team of engineers, testers, designers, and managers at a cost of approximately US$400,000 per month. It depends on the logic of your application, the number of platforms on which you publish it, and the number and complexity of integrations.

Healthcare software development companycan help you manage to dispense, improve patient care, and monitor medical claims.

Type of Software SolutionEstimated Software Development Cost
Healthcare SoftwareApprox $40k – 100k+
Automotive SoftwareApprox $80k
Education SoftwareApprox $50k


Are you planning to invest in software development? Then have a clear idea about which platform is best suited for developing your customized software solution can paint a clear cost picture. We have discussed some of the most popular software development platforms and the estimated cost for rough estimations.

Software PlatformDevelopment Cost
Android PlatformStarting cost $10,000
iOS PlatformStarting cost $25,000
Cross-platform PlatformStarting cost $40,000
Web PlatformStarting cost $80,000
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Team Size

Most software development companies share a cost estimation based on project size and team size. Large or complex software development project requires a bigger team working in collaboration and managing different software aspects. Based on the project and team size, the estimated cost of a large project can be five times higher than a small business software with basic functionality and features.

Project SizeTeam SizeDevelopment Cost
Large Project100+Starting price $100k +
Medium Project50-100Starting price $80k+
Small Project10 to 50

Starting price $20k+

Complete Software Development Cost Breakdown

For better cost breakdown analysis, the table below depicts the stepwise software development cost. We have collected custom software development data to create the stepwise cost estimation.

StagesTimeDevelopment Cost
Documentation40-45 hours$1000 to $2000
UI/UX design 60 Hours$1500 to $3000
Front-end and Back-end400 Hours$10,000 to $ 20,000
Testing & Debugging80 Hours$2000 to $4000

How Much Does A Financial Software Development Cost?

Without any doubt, it is understood that the future of Fintech is much brighter as compared to other industries. There are several factors on which the cost of an app depends such as the type of platform, the developer’s salary, and many more.  Typically, the cost to develop Fintech app ranges from $20,000 to $1,00,000. The cost of financial technology software is broken down into:

  • The development cost of a financial application with basic functions and a simple UI on a single platform is approximately US$20,000 to US$40,000.
  • The cost of building a top-notch banking application with advanced features ranges from US$40,000 to US$70,000.
  • The development cost of creating feature-rich financial and banking applications for Android/iOS with complex UI will reach around US$70,000-125,000.

Software Development Life Cycle

Software systems have become increasingly complicated over the last few decades. At the same time, there isn't a single industry or field of expertise that hasn't been affected by technology. As a result, it became necessary to codify the software development process and establish a common model for managing its life cycle.

To define the significant stages and tasks of a software development process, there was the introduction of the very first formal project management framework known as the Software Development Life Cycle (SDLC). This cycle also helps to give an estimate for the average cost of software development and explains an approach to pursue the information regarding the integrated systems in a well-structured and deliberate manner. 

Emphasizing it more there are a total 6 stages in the software development life cycle, let us have a look at each of them one by one- 

1. Planning

It is the initial stage of the cycle that interests the preliminary requirements supported by the analysis, research, basic project vision, and scope of the project. The significant roles in this stage are customers, sales representatives, and business analysts. The outcome of this stage would be the understanding of clients' needs, basic project road map, and technical recommendations required for the project. 

2. Analysis

In this stage, analysis is held where the identification of the project goals and functionality is done. Keeping the goals in mind all the technical specifications and requirements are finalized. Plus, all the potential challenges are found along with their solutions without interrupting the workflow. This stage of the software development cycle includes key roles of the customer and development team comprising project managers, business analysts, and technical experts. The end result of this stage gives out complete functional and design specifications, the work breakdown structure of the project, and the average cost of custom software development. 

3. Design

The third stage of the SDLC cycle is designed where the creation of basic system architecture and visual design is performed. The whole process is put in implementation by the development team comprising architects, project managers, and UI & UX experts. The development team makes sure to draft the complete system architecture and the final design of the product. At this stage of software development, one can easily calculate and answer how much does software development costs. 

4. Implementation 

In this stage of the SDLC, the process of software development initiates and by the development team only which includes software engineers, QA engineers, project managers. There is a complete functioning of the software product with a fully-featured integration. 

5. Testing 

The whole purpose of this stage is to check the quality of the software development process or it acts as a quality assurance check of the product. This stage includes all the software engineers, QA engineers, and project managers, and also user experience is kept in mind. After this stage, a finalized software product is created with the necessary quality. 

This cost breakdown analysis works best with well-defined projects, clear needs, and a small scope of work with low complexity. Typically, these software solutions are utilized to tackle a secondary business problem or automate a specific internal process. It could be a basic tool or a landing page streamlining a company procedure. Considering software development cost breakdown, a fixed-price collaboration approach is possible since the effort is stated and the outcomes are predictable.

The standard SDLC has a lot of drawbacks despite being a simple and easy approach. One of them is the high level of uncertainty that happens early in the software development process. Therefore, it might be the ideal way to calculate the average custom software development cost.

Moving ahead we have tried to give you full pricing on software development services in this post, as well as explain the important aspects that influence the ultimate software development cost breakdown.

How Much Does it Cost to Outsource Software Project: Different Cost Breakdowns

There is no precise classification of project size when it comes to software development. Because it is highly subjective, you should take our advice with a grain of salt, as other firms and development teams may have different perspectives. With that said, there are a few crucial characteristics that will enable you and the development team in estimating the project cost more accurately.

1. Material & Time Cost

The Time & Material technique, which is essentially a pay-as-you-go model in which you will be invoiced based on the number of work hours of the team, is most common in the IT business. When it comes to custom software with large project scope, this strategy is the best to calculate the average cost of custom software development. It helps you to be flexible with your budget and adapt the scope as your demands change.

2. Fixed Price Software Development Cost Breakdown

However, some organizations utilize a fixed-price estimation strategy, which means they estimate the cost at the start of the project and don't make any revisions thereafter. While this strategy is effective for smaller software products, it also necessitates a very tightly defined scope.

When using a fixed-price estimate, keep in mind that risk charges are included in the estimate in case something goes wrong. This strategy may or may not be agile enough for you, depending on your project.

If you require additional features or designs, you will need to renegotiate your entire contract, which is a time-consuming process.

3. UI/UX Design

The design is the next major component of the overall average cost of custom software development. Both UX and UI, especially for a larger software project, can take a long time to finish. The team must first do in-depth research on the market, client needs, user behaviors, rivals, and so on.

Then they'll move on to more in-depth research, such as user interviews, customer journey mapping, and so on. Then there's UI design and UX design (wireframing, prototyping, and testing). All of this will take some time, and larger projects (such as a social media mobile app or a marketplace) may take up to a month. This is a significant expense for your company, and you'll need to budget for it.

4. Deployment Platform

Software development costs vary depending on the software's distribution platform, as each platform has its own set of requirements. If the application is for a mobile device, the operating system is the deciding factor. Is it only available for iOS? Or is it Android? All of these factors must be taken into account when determining the cost of software development.

The software development cost for each deployment platform will differ since each deployment platform has a different number of devices for which the application will be deployed. Android has a much larger number of devices than iOS, and producing an Android app will always be more expensive than developing an iOS app.

Similarly, if you want to create an app that can compete with well-known apps like Uber, you'll need to develop it for all of the major deployment platforms, including Android, iOS, and Windows. This means you'll need a lot more money or we can also say this way you can also have an estimate for the cost of software development.

Custom Software Development Cost


Looking solely, it's critical to recognize that estimating the cost of custom software development and software development cost breakdown and must say it's far more complicated than it appears at first glance. There are numerous technical and non-technical issues to consider before proceeding.

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