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Every time you open the article about costs, you find vague numbers that significantly vary — we understand your frustration. However, each project is unique, and there are many factors that influence costs.
Making estimates without the project's thorough analysis is a pointless exercise. In this article, we'll guide you through different financial aspects of software projects, so you'll have an idea about your future web app development cost.
Custom web development is a multilevel and multicomponent process. All these components influence development cost, and missing some may lead to incorrect project estimations. But don't worry — we won't let you miss a thing.
It all starts with the type of app you want to build and its purpose. Let's explore the main ones.
Single-page apps (SPAs) are web applications that dynamically update content without reloading the entire page. They are widely used in domains like social media, business communication, SaaS and enterprise apps, and marketplace platforms.
SPAs are great for fast, real-time interactions, provide a seamless user experience, and are optimized for mobile. However, they use more browser resources, pose security risks, and are more complex to develop.
Prominent examples are Google Calendar, Facebook, Trello, and Slack.
The cost of web application development is initially higher for this type, but they are cost-effective over time.
Multipage applications (MPAs) are structured websites with multiple pages, ideal for content-heavy and SEO-friendly platforms. Common examples include forums, blogs, banks, and university websites. Businesses use MPAs in eCommerce, HealthTech, and EdTech to manage extensive information and structured navigation.
Compared to SPAs, MPAs are larger, have a higher server load, and are less dynamic. Nevertheless, such applications handle large content volumes well, have strong SEO capabilities, and have faster first loads.
Famous MPA examples include Amazon, Walmart, BBC, The New York Times, and Booking.com.
For this type, web application development cost is initially lower. Still, it becomes costly at scale due to higher server and maintenance expenses.
A progressive web app (PWA) is a web application that provides a native app-like experience while running in a browser. As a cost-effective alternative to native apps, PWAs require a higher budget than any other web application.
While PWAs have great performance and lower server loads, they require SEO optimization and can work incorrectly on legacy browsers.
Great examples of this app type include Starbucks, Alibaba, Forbes, and Flipkart.
From the aspect of web app development cost, PWAs are the most expensive initially but have the lowest long-term costs due to caching, offline support, and reduced server dependency.
Your project's scope directly influences the cost of web application development. There is a great difference between building a small platform-based store for a hundred stock keeping units (SKUs) and a custom inventory management system with real-time updates.
Going more in-depth, various factors constitute your project scope and need careful evaluation:
A thorough definition of the project scope increases the precision of financial forecasts, facilitating effective budget organization and eliminating the risk of scope expansion.
Depending on the domain — eCommerce, healthcare, FinTech, or manufacturing — your web app must comply with different regulatory requirements. The more complex they are, the higher the custom web application development cost will be.
For example, healthcare software, such as electronic medical records or patient portals, must be HIPAA and EVV-compliant, integrate HL7 standards, and follow other regulations according to the app's specifics. If your app goes global, you must ensure it complies with local rules and regulations (PIPEDA in Canada, GDPR for the EU, and LGPD in Brazil).
Tight deadlines drive rapid team expansion, increased hourly rates, and overtime payments. All these factors raise development costs. Rushed development is not only more expensive but also riskier, with a higher possibility of bugs, burnouts, scope creep, and overall project failure.
Tip: make sure your deadlines are based on realistic project scope estimates, not on the random dates dictated by financial reasons.
Aside from the app's main functions, other characteristics also need thorough examination, and failing to address them might result in operational failures and disappointment for users. The app's scalability, security, maintainability, performance, and system stability cannot be a low priority if you aim for a successful project launch.
Elaboration of backup and recovery plans and procedures is a vital part of non-functional requirements, helping prevent data loss and cut downtime. They protect your system against extended interruptions and outages, ensuring your information remains secure even during unexpected events.
The complexity of a web app's design plays a major role in development cost, timeline, and required expertise. A more intricate design demands greater effort, advanced skills, and higher resource investment.
Design complexity depends on the number of elements, animations, customizations, layouts, and branding efforts. Depending on the project's complexity, design typically accounts for 20% to 50% of custom web application development pricing.
For example, a web app with a simple design can be a basic business website with a standard set of landing pages, ‘about’ pages, and contact forms.
Medium design apps are eCommerce stores with interactive components and custom branding. They include product pages, cart UI, and checkout experience.
Complex-design web apps might include social media platforms and enterprise software. They have fully custom UIs, advanced UX workflows, data-driven visuals, and real-time updates.
The hiring model you choose significantly impacts web app development costs, potentially affecting your budget by 20% to 40%. Let's explore what options to consider, together with their strengths and weaknesses.
Setting up an in-house team is an option not all businesses can afford from the start. While bringing complete control over the project and allowing you to make the perfect cultural fit, it carries high upfront and ongoing costs that might be unbearable for small companies and startups.
An in-house team is a good option if:
Web development outsourcing allows you to decrease project risks, launch your product faster, and access high-quality expertise and skillsets. When chosen wisely, an outsourcing company becomes your trusted partner who is genuinely interested in your product's success.
Regarding website and app development costs, offshore outsourcing offers the most value with the best cost-quality ratio. If you want your outsourced team closer to you, opt for onshore or nearshore development. However, the hourly rates for these regions will be higher.
Outsourcing remains a popular model for software development. The global offshore market is expected to grow at a CAGR of 10.13% from 2024 to 2031, reaching $283 billion. With some prejudice remaining in the air, a wisely selected service provider will deliver quality code on time and within budget.
Hiring freelancers for software development is a flexible and cost-effective option. It allows you to find specialized expertise, hire professionals quickly, and have flexible engagement.
But no advantages come without trade-offs: some freelancers may miss deadlines, lack commitment, or disappear mid-project. Communication barriers or quality inconsistency can also exist.
Overall, hiring freelancers is a good match if you have a small project of low complexity or if you need specialized skills for a short-term task.
Tip: If choosing outsourcing, select a suitable engagement model. A fixed-price contract entails a predictable budget but is not flexible to scope changes; a time-and-material model allows you to change the requirements and pay only for the work done.
The world is not homogeneous, which is equally true for website and app development costs. That is why the location of your development team matters. In the last decade, aside from North America, three main development hubs emerged: Eastern Europe, Latin America, and Southeast Asia.
The USA and Canada have the highest hourly rates due to higher living costs. The talent pool is robust, yet you might find it hard to find narrow specialists. On the other hand, you can hire developers in your in-house team or work with an onshore outsourcing company without a time zone difference.
Average hourly rate: $143-$172
Hiring development teams in countries like Poland or Ukraine is beneficial for many reasons. First, you get access to the diverse pool of top professionals — the region is famous for its tech education and high proficiency in English. Second, you hire specialists with strong work ethics and close cultural alignment with Western business environments. Finally, Eastern Europe provides the best cost-quality ratio experts compared to other options.
Average hourly rate: $68-$76
The Philippines, Vietnam, and India offer a large labor market with competitive hourly rates. However, issues may occur with handling cultural differences, potential communication gaps, and hard-to-maintain compliance standards. While the cost of web application development in this region can be the lowest, there might be quality considerations, therefore, choose wisely.
Average hourly rate: $34-$41
Countries like Brazil, Argentina, and Mexico are considered great options for US businesses in terms of little time zone difference and a saturated workforce market. Nevertheless, some communication issues can occur with English being a second language for many and cultural differences.
Average hourly rate: $65-$82
Ultimately, if you want to optimize your web app development cost, a feasible approach is to look outwards at hiring opportunities worldwide. According to Accelerance research, 64% of respondents reported that the lack of tech talent is a serious barrier to the adoption of emerging technologies.
Don't hamper your business growth by focusing only on the local labor market. When examining global hiring opportunities, consider aspects like cultural compatibility, time zone difference, local rates, tech, and English proficiency to make a perfect choice.
While planning a web app development budget, you should also account for post-release expenses, which can amount to 10-30% of the initial project cost yearly.
While the concise calculations require deep project analysis, the approximate costs are available across the Internet; however, they also greatly vary. Let’s look at the custom web application development pricing from the point of view of the final project you want to get.
If you’re a startup with a limited budget (almost all startups are) or a business with an idea that needs to be proven, proof of concept (POC) can be a great start.
In essence, POC is a simple project built to prove the overall project’s technical feasibility and validate business ideas. It reflects future product’s core functionality and shows whether it can be further developed without resource overspending. It is shared with the stakeholders and investors to win their confidence in moving forward with the development process.
On average, the cost of a POC can vary from $5,000 to $30,000, depending on the complexity and functionalities embedded.
The minimum viable product (MVP) is the next step in testing your business idea. Compared to POC, MVP has more robust functionalities and a thought-out design. It is presented to potential customers for their feedback. You build MVP to validate your idea not within business circles but in the market — for the intended target audience.
The cost of a web-based MVP ranges from $20,000 to $150,000, depending on complexity. High-end MVPs typically include AI-driven functionality, multi-user roles, real-time features, and compliance with industry regulations.
The cost of developing a simple web app starts at $20,000 and can reach $75,000 and counting. Such apps have few features, plain UI/IX, basic search functions, and some interactive elements. They are often template-based, have little customization, and use third-party integrations for functions like authentication or chatting.
Medium-sized web apps cost between $75,000 and $250,000. They may include advanced features like analytics and real-time data synchronization, robust integrations with third-party services, and personalized dashboards.
Web application development cost for large, complex web projects starts at $250,000. Enterprise applications are the most complex software to build, yet they are the most advanced in terms of technology and functionality. Often used in healthcare, banking and government domains, they have robust security features and regulatory compliance. Moreover, complex web apps may use AI, fraud detection systems, machine learning models, and live data streaming.
If you have a restrained budget or cannot allocate many resources to the development at once, there are ways to save a dollar.
A well-designed project plan defines the project scope precisely and estimates its cost, avoids sudden scope creep, decreases development risks, and outlines clear business objectives.
This is also the right time to assess risks by gathering requirements and defining user stories and use cases, and selecting the tech stack. These measures will accelerate development, ensuring the product aligns with business goals and meets customer needs.
Do not take too long with testing your business idea — you can do it without full-fledged development. To start MVP, select the core app features and build a fully functional app based on them. By doing so, you can release your product faster with significant budget savings. Many great startups like Slack, Skype, and WhatsApp, began with simple, one-page web apps, expanding and adding more features later.
If MVP is not your cup of tea, but your project seems complex, and you feel that you may exceed your development budget, try feature prioritization. Apply the MoSCoW approach, use the Pareto principle, or use a prioritization matrix to decide what to focus on first.
Check the tools that accelerate your development, such as GitHub Copilot, OutSystems, and Bubble.io. That approach will suit you if you're a startup or small business that needs functional websites and applications quickly. In case you want a custom web app with robust features and branding, it's better to use other cutting-cost options.
It's no surprise that using Gen AI in coding greatly influences custom web application development costs. Productivity gains from using AI in software development could be worth $12 billion in the US alone.
Deploying your app in cloud infrastructure allows you to seamlessly scale computing and storage resources, meaning you pay only for the functionality you use. This cloud-native approach ensures minimal downtime, reduces risks from server failures, and offers built-in security measures like encryption, access control, and threat monitoring.
With a success rate of 88% for cloud investments, cloud-native solutions are becoming a more lucrative option for businesses. According to Deloitte's Future of Cloud report, 84% of respondents stated cost reduction optimization as the strategic priority for investing in the cloud.
Partnerships with development companies from cost-efficient regions like Eastern Europe can lower your website and app development costs without quality loss or deadlines disrupted. For example, an average developer's hourly rate in the US can reach $200, while it will be around $100 or less in Poland.
An experienced web development company can facilitate the process of collecting requirements, define the project's scope, identify user pain points, and choose the right tech stack. At the end of this phase, you'll get a professional cost estimate, a defined project scope, and a roadmap for further development.
In estimating software development costs, NEKLO considers time, resources, and scope. The scope encompasses the tasks required to achieve project objectives; available time dictates deadlines, and resources determine the effort you can afford.
Let's look at how we form custom web application development pricing for our clients.
"The accuracy of web application development cost estimation hinges on comprehensive consultations with senior developers. By considering different perspectives, we can better predict and solve potential challenges".
Anastasia Kulesh, NEKLO's Project manager
In case you need some quick answers, we created a list of the most burning questions people browse about web app development cost.
To prevent unexpected costs in a web development project, you need to define its scope as accurately as possible from the start, hire a professional development team, and establish effective project management tools and regular reporting.
Web application development cost results from choices you make at the planning stage: your project requirements and timeframe, hiring option, the number of regulations your app must comply with, and a tech stack. You can estimate the initial project cost by applying different methods based on these parameters.
If you find it difficult to make high-level estimates, discuss your project with professional development companies. They will consult you on the approximate project cost and advise on the best approach to its realization.
It depends on the hiring model you choose. Suppose you are a US company hiring local talent. In that case, the development cost for a medium web app can vary from $100,000 to $250,000. If you opt for outsourced product development, you can save up to 40%.
Depending on the hiring model, a simple web app development can cost $20,000 to $75,000.The development team location also influences the final cost, with the highest hourly rates in the US and Canada.
So, how much does it cost to build? There is no one-size-fits-all answer to this question. Estimating web application development cost requires a comprehensive analysis of your project scope, requirements, time, budget, staffing decisions, and the type of product you want to build.
With a record proven by 300+ successful projects, NEKLO is ready to help you with your web development project. Contact us to learn more about our engagement models and pricing and to schedule a free consultation.
US-based and operating globally, NEKLO spearheads digital transformation initiatives for businesses worldwide. We deliver software solutions complying with your market and legislation.
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