May 10, 2017

Obtaining custom software development rates isn’t that hard to do. As an example, we also had created a 2017 Global Custom Software Development Rates Guide where you can find detailed hourly rates for software outsourcing and offshoring in most popular locations. The market is saturated with numerous providers, and anyone can get custom software development hourly rate that accommodates their budget or expectations. However, when hiring a specialized software engineer, you need to understand what the contract programmer hourly rate will be and where it comes from.This article will address the main aspects that establish custom software development rates so you’ll know how to break down the software development rate card and learn how group size, location, and experience affect the software development hourly rate.

There are a few important elements that affect the estimate you’ll be given when having software development outsourced; experience, location, and engagement duration. These are the components you need to consider when calculating how much does it cost for software development.

 

How teams experience impacts custom software development rates

Custom software development rates differ based on technical expertise, technical experience levels, outsourcing experience, and industry expertise. Of course, senior developer’s hourly rates will be higher than their younger counterparts, but in most offshore and nearshore regions, you can interact with businesses who offer experienced senior developers at the same hourly rate as a local junior developer without experience would cost. Choose an outsourcing organization with plenty of experience in associated technologies. Look for people who are experts in what your business vertical. You might wish to limit your search to only experts in a specific field. Whether you work in pharmaceuticals, finance, oil and gas industry or another industry that relies on software, you’ll need a developer with an experience in that field.

Selecting a custom software development company with extensive experience in your field can enhance productivity and communication, but it isn’t mandatory. Industry experience will enhance your software’s value as you can take advantage of your provider’s prior knowledge of the objectives, standards, and difficulties that are typical in your field. Custom software development rates will differ based on the region and industry. Lastly, organizations who are established specialists with years of experience as a reliable outsourcing provider may charge higher custom software development hourly rate that businesses who lack experience. Choose to work with outsourcers who understand how to handle engagements and clients like you.

 

How team's size impacts custom software development rates

The more complicated your software engagement is, the more resources will be needed by your offshore software development team to finish it. For the most part, lengthier engagements with larger groups will regularly be accompanied by a higher overall cost, but offer value in the long-run. Custom software development companies financially prosper from offering big offshore dedicated development teams throughout long durations. As such, organizations are usually open to providing clients with lower custom software development rates who require more services for a longer period.

If your software engagement warrants 20 to 30 developers for a timeframe of 2 years, you might pay a lower custom software development hourly rate than you would if engagement only needed 3 to 5 developers for less than 12 months. Mind you, committing to short-term software engagements raises the likelihood of benching developers while anticipating another project, resulting in long engagements with the costlier software developer hourly rate. Of course, you might be skeptical about being committed to the offshore dedicated development team you haven’t worked with before. Long-term commitments offer better value overall, but it’s vital that your agreement includes a 1 to 2-month termination period.

Doing so will mitigate the worry of over-committing while leveraging the greatest term agreement value. When outsourcing, ensure you can get out of the agreement in the event of changes in business conditions or performance issues.

How team's location impacts custom software development rates

THIS IS HOW CUSTOM SOFTWARE DEVELOPMENT RATES DEPEND ON THE LOCATION

North America

North America namely the U.S.A. – is one of the world’s largest tech hubs. Their esteemed colleges and universities produce qualified software developers. However, the large developer demand has resulted in a supply shortage. As a result of this and expensive living costs, the software developer hourly rate can be costly.

Eastern Europe

Eastern Europe is full of science in an engineering educational programs. This area is host to a substantial amount of skilled experts in the software development industry, but at much cheaper custom software development rates in comparison to Western Europe and North America. Expense-wise, the market is divided into a couple of sections: lower cost (Belarus, Ukraine, Armenia); and higher cost (Hungary, Poland, Romania, Bulgaria, and the Balkans). Every country in this region has the solid algorithm, data, and embedded system expertise.

Latin America

In Latin America, software outsourcing has increased substantially, particularly in countries such as Argentina, Mexico, Peru, and Colombia. Due to their close proximity to clients in North America, such countries favorably compete with China, India, and other destinations for outsourcing in terms of affordable custom software development rates. Latin American universities have IT programs and an abundance of developers to handle software outsourcing obligations. The average custom software development rates are higher than in other areas but are still cheaper than hiring an in-house team.

Asia

Outsourced software development and IT had a key role in the economy of several Asian countries. As such, offshore software developers from Asia are the skilled people that have been taught at the most respected colleges and universities in the world. The region is divided into a couple of sections: the initial one is comprised of China and India, where you’re more inclined to locate qualified talent, but might need to make reliability or expense sacrifices (due to adverse working conditions). The other is comprised of smaller countries like Vietnam and the Philippines, where you can access the same level of talent at cheaper custom software development rates with a greater degree of project contentment.

If you are still reading, you seem to be interested in getting software development rate card to know how much does it cost for software development in your case. If you’re looking for someone to make an estimation of your software development costs – we are the ones who you are looking for. Visit our Custom Software Development Services Page or send your requirements directly to Existek and we will be able to come up the detailed value offer for your project.

Perhaps you are dealing with outsourcing for a long time, which makes you already experienced in this sphere – if we match your ideas, or they are completely different, which is even better, you are free to share your opinion in the comments section below.