How to choose a software development company - blog cover

Browsing for the top software development company for your business is often considered an overwhelming job. Some SMBs can’t find it easy to search for organizations that provide tailored software development services, nor would they know where to find one. Even if they knew where to go, how does one determine what they should receive for their money or what to pay to begin with?

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There is an abundance of custom software development companies to choose from. By Googling “software development company”, you’ll see more than 5 million results, which is an impressive starting point. For recommendations, you can consult other companies or your city’s chamber of commerce. You can also visit a nearby tech meeting to scout for an individual who can take your project on.

Once you’ve narrowed down your options, you should ask the potential developers about other software projects they have finished. You should also obtain references from the organizations they’ve collaborated with in the past. When feasible, try out the software they’ve created. This might be a more troublesome step since custom software is usually exclusive to the company that paid for it.


There are several reasons why you might want to apply for the services of a software development company:

Expertise and experience: A software development company typically has a team of experienced developers who can bring their expertise to your project. They can provide you with valuable insights into your project, suggest improvements, and ensure that your project is completed efficiently and effectively. Additionally, their experience in delivering software solutions can be leveraged to deliver quality work on time and within budget.

Cost savings: Outsourcing software development can be more cost-effective than hiring an in-house team of developers. The cost of setting up an in-house team with the right skills, equipment, and infrastructure can be high. A software development company has already invested in these resources, allowing you to save costs while still receiving quality services.

Access to the latest technologies: Software development companies stay up-to-date with the latest technologies and tools, which means that they can deliver cutting-edge solutions that meet your specific needs. You can leverage their knowledge of new technology trends, programming languages, frameworks, and methodologies to build better software that is aligned with the latest standards.

Scalability: Software development companies can scale their team up or down depending on your project requirements, which can be beneficial if you have a fluctuating workload. This means that you can easily adjust your development resources so you have the right people working on your project at the right time. This also means that you don’t have to worry about maintaining a larger in-house team for fluctuating workloads or worry about delays due to a lack of resources.

Focus on your core business: Outsourcing software development can free up your time and resources so that you can focus on your core business activities. By relying on the expertise of a software development company, you can divert your attention to other critical aspects of your business, such as sales, marketing, and customer support.

Risk mitigation: Working with a reputable software development company can reduce the risk of errors, delays, and other issues that can occur during the development process. Software development companies typically have extensive quality assurance processes in place, and they are more likely to have processes to mitigate common development challenges, such as testing, version control, documentation, and project management.

Overall, partnering with a software development company can help you bring your software projects to life quickly and efficiently while staying within budget and achieving your desired outcomes. The right software development company can offer a range of benefits that can save you time and money, provide you with access to the latest technologies, and help you mitigate risks associated with software development.


The rates of a software development company can differ based on your requirements. For the most part, you might end up paying between $50 to $250 hourly based on who you work with, what their level of experience is, and the industry they serve. If your project is substantially large in scope, you should rely on several engineers. A project manager or designer might also be a part of your project as well as the need to set up the cross-functional team from scratch.

Be mindful that custom software will be substantially costlier than the up-front expenses or subscriptions you normally pay for other programs. With commercial software, you can divide the costs among other users, whereas custom software warrants covering the whole bill. At the same time, when we are speaking about specialized subscription-based software for the Oil & Gas Industry or Healthcare, the development of a custom solution can be way cheaper than paying the subscription for hundreds of your workers. With that said, commercial software restricts you to the features chosen to offer you, as opposed to custom software, which gives you the adaptability to develop something exclusive to your company.

Even custom software will require maintenance after it has been built. There’s no such thing as error-free software, and the technology’s nature warrants software to be modified as the environment changes. These adjustments may include new security exploits or necessities, updates to operating systems, and support for new devices. The investment you make in custom software starts with your up-front development costs.

What are global custom software development rates?

Download the report to get a comprehensive analysis of the pricing in the five most popular onshore and offshore outsourcing locations. Hourly rate cards for these territories are included.

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For most people, it’s usually hard to comprehend the expenses that come with software development since it’s not a physical product. The end-user or buyer seldom inspects things to see what was done by a software development company. At times, SMBs are surprised that the concept they had wasn’t within their budget. It’s vital that you understand what is required to create quality software.

Currently, software engineering is one of the most in-demand careers in the whole world. The economics comes down to demand and supply. Quality custom software development company charges a higher rate. Further, software creation can’t be rushed. It’s simple to put together software that does a specific job in an isolated atmosphere. However, creating networked applications that must be synchronized in real-time across multiple users and devices while taking into account numerous conditions is time-consuming. It warrants a substantial amount of assessments to make sure the final product is worthwhile.

The environments software development company uses to create, install, and maintain software is expensive. Bandwidth is pricey, as is CPU time and electricity. The hardware and software used by such companies to create and assess software aren’t cheap. It is also time-consuming to create quality assessment environments, keep the servers maintained, and stay on schedule with their field adjustments daily. Each one of these expenses must be taken into consideration.


When choosing a software development company, consider the following requirements:

Expertise: Look for a company that has expertise in the type of software development that you need. For instance, if you need a web application, look for a company that has experience building web applications. If you need a mobile app, look for a company that has expertise in developing mobile apps. You can also consider the company’s experience with specific programming languages, frameworks, or platforms that you require.

Portfolio: A company’s portfolio is a great indicator of its capabilities and the quality of its work. Look for a company that has a portfolio of similar projects to yours, and review their case studies to get a sense of their experience, approach, and outcomes.

Reputation: Check the company’s reputation by reading reviews and testimonials from their previous clients. You can also check their rating on third-party review sites, such as Clutch, GoodFirms, etc. Additionally, you can check if the company has any industry awards, recognitions, or certifications that demonstrate its expertise and quality.

Communication: Clear communication is critical to ensure that the development process runs smoothly and the final product meets your expectations. Look for a company that has clear and open communication channels, such as a project management tool, email, or instant messaging. Additionally, make sure that the company assigns a dedicated project manager or account manager who can be your main point of contact and provide regular progress updates.

Pricing: Consider the company’s pricing and make sure that it aligns with your budget and project scope. Look for a company that provides transparent pricing, such as hourly rates or fixed-price quotes, and avoids any hidden costs or fees. Also, consider the company’s payment terms, such as upfront payment, installment-based, or milestone-based.

Support: A software development project is not over when the product is delivered. Make sure that the company provides post-development support, such as maintenance, bug fixing, and updates. Also, check if they have a service level agreement (SLA) that guarantees a response time or resolution time for any issues that may arise.

Technology stack: Look for a company that uses modern and relevant technologies for the development process. This ensures that the final product is scalable, secure, and maintainable. You can ask the company about the specific technologies, tools, and frameworks they use and why they choose them over others.

Project management: The success of a software development project relies heavily on effective project management. Look for a company that has a structured and organized approach to managing the development process. This includes regular status updates, milestone tracking, risk management, change management, and stakeholder engagement. You can also ask the company about its project management methodology, such as Agile, Waterfall, or hybrid.

Culture: Finally, consider the company’s culture and work ethics to ensure that they align with your values and goals. This includes their approach to teamwork, innovation, creativity, customer service, and social responsibility. You can learn about the company’s culture through its website, social media, blog, or by speaking with its employees.


This begs the question: is it worth outsourcing a custom software project overseas where such expenses are cheaper, or is it more prudent to keep things local (or in the same country) with a software development company you can meet in person when you have to? Let someone with technical experience handle the outsourcing tasks. These skilled individuals will know what to outsource and what to handle in-house.

Getting someone from another country to work on a project can be problematic. It shouldn’t be done by someone who can’t read and test coding. Differences in cultures are one thing, but time zones alone make the experience of working with someone internationally a hassle, particularly for an individual without any experience in software project management.

Outsourcing software development can offer several benefits, including cost savings, access to a larger talent pool, increased flexibility, and faster time to market. By outsourcing, businesses can reduce the overhead costs of hiring and managing an in-house development team while gaining access to a wider range of expertise and specialized skills. Additionally, outsourcing can allow companies to scale up or down their development resources more easily based on their changing needs. Finally, outsourcing can help businesses bring products to market faster by leveraging the resources and expertise of an external development team.


When it comes to choosing a software development company, selecting the right engagement model can be critical to the success of your project. Here are some more details on the different engagement models and factors to consider when choosing one:

Fixed Price Model: This model works well for well-defined projects with clear objectives, scope, and requirements. The project is priced based on the scope of work and the anticipated deliverables. While this model provides a clear timeline and budget, it can be challenging to incorporate changes once the project has begun. It’s important to work with a company that has a clear understanding of the requirements and can provide a detailed proposal that covers all aspects of the project.

Time and Materials Model: In this model, the company charges based on the amount of time and resources spent on the project. This model works well for projects that are not well-defined and may require changes along the way. It provides flexibility for adjustments and allows for changes to be incorporated throughout the project. However, it can be challenging to manage the budget and timeline, especially if there are frequent changes. It’s important to work with a company that provides regular progress reports and maintains transparency on time and resource usage.

Dedicated Team Model: With this model, you hire a team of developers to work exclusively on your project. This model works well for long-term projects that require ongoing development and maintenance. The dedicated team becomes an extension of your team, providing continuity and a deep understanding of the project. However, this model requires a higher level of management and can be more expensive than other models. It’s important to work with a company that has a strong track record of successful dedicated team engagements and can provide ongoing progress updates.

Agile Model: This model is an iterative approach to software development, where the project is broken down into smaller parts and delivered incrementally. It’s suitable for projects that require flexibility and adaptability. The Agile model enables teams to adjust to changing requirements and provides regular checkpoints for review and feedback. However, it can be challenging to manage the scope and timeline of the project. It’s important to work with a company that has a strong Agile methodology and can provide regular progress reports and transparency on the project’s status.

Looking for more details about engagement models?

We suggest checking our latest article on IT outsourcing models and types of outsourcing contracts.

Models and Types of Contracts

When choosing a software development company, it’s important to consider which engagement model aligns best with your project requirements and objectives. Consider the level of flexibility you need, the scope and complexity of the project, and your budget and timeline constraints. It’s also important to work with a company that has a strong track record of successful projects and can provide references and case studies that demonstrate their expertise in the engagement model you choose.


You must perceive customer software development services as an investment, just like you would for something tangible like new equipment. There are costs that come with these investments, though. They come with service and quality distinctions as per the vendor you selected, and they must provide an adequate ROI. Likewise, the more important the investment, the greater your margins must be for the risk to be justified.

In this article, we’ve covered only some of the things you have to be certain about before starting your research for a software development company.

Would you like a professional and free consultation before planning your custom software development project?

You may contact Existek’s team of experts. We’d love to hear from you and share our decade-long experience with you.

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Frequently asked questions

What are the reasons for choosing a software development company?

Businesses of different specifications have acknowledged the importance of receiving the following advantages:

  • Expertise and experience

  • Cost savings

  • Access to the latest technologies

  • Scalability

  • Focus on your core business

  • Risk mitigation

How to choose the right software development company?

Choosing the right software development company requires careful consideration and evaluation of various factors. By determining your specific needs, researching and shortlisting companies, evaluating their website and portfolio, assessing their technical expertise, project management methodology, communication and collaboration skills, quality assurance and testing process, pricing and contract terms, and their support and maintenance services, you can make an informed decision. Remember to consider the cultural fit and establish a long-term partnership with a company that can grow with your business.

What are the common engagement models for partnering with a software development company?

The most common market practices include:

  • Fixed Price Model

  • Time and Materials Model

  • Dedicated Team Model

  • Agile Model

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