How Much Does Software Development Cost? (in 2023)

In this digital world that is always changing, all businesses need software to run their operations smoothly and have an easier time managing their data. However, business owners must gather all relevant information, including the costs of custom software development, before making an investment in this solution.

In 2023, business owners will be aware of the significance of IT services and the significance of developing a robust digital presence. However, many continue to need help with the issue of software development costs and overall budgeting. Ultimately, the entrepreneur is forced to play wisely and select a vendor who seems right and promises to provide a cutting-edge solution for the discussed price.

Two options are available from there: Either the contractor delivers subpar software that propels the company to new heights, or the entrepreneur needs more money due to the audience’s lack of interest in it.

Conducting some research is one way to steer clear of that grim scenario. Therefore, we have created a comprehensive cost guide for software development to make things easier for anyone interested. This editorial has important information about the price range for development services and the factors that affect the current rates.

There is one thing that all industries have in common regarding technology adoption: The pricing of software development has remained unchanged as the technological revolution gains momentum. Today, we’ll show you how much software development will cost on average in 2023 and the main catalyst of that cost.

A Brief Overview of Software Development Cost

A Brief Overview of Software Development Cost

Before we indulge ourselves in the detailed guide, let’s take a brief overview of software development costing. First of all, there is nothing exists, such as a specific amount of cost that will decide the software cost for every project. But entrepreneurs should keep in mind that it varies from industry to industry and mostly depends on the features and location of the development team. 

The global software market is estimated to reach $1039.89 billion by 2030. Shocking! These numbers reflect how business owners are going gaga over software development in the future. 

That extensive spectrum is not conducive to budgeting. However, it provides some insight into the pricing of custom software. For example, if a business owner is willing to spend less than $25,000 on a digital product, there may be better options than bespoke solutions that are built from the ground up.

Nevertheless, there is a method for determining whether your particular custom project will cost less or more. Now we will throw some light on the main catalysts that decide the cost of the software. 

Significant Factors that Determine Software Development Cost

Significant Factors that Determine Software Development Cost

Nowadays, organizations and businesses in all industry sectors require software development. Conducting extensive research is necessary for brands when selecting the right software development services provider. However, since a tailored solution is the best option for businesses of all sizes, the cost of custom software development should also be considered.

How can a company get the most out of custom software development? Several different factors influence the creation of business software. First, let’s dig into the detail. 

Software Complexity 

Software Complexity

Software is said to be more complex when it uses a lot of processing power and has too many features. As a result, software development costs increase because complex software requires a lot of time and effort from experienced software developers.

It usually takes between one and two months to develop basic software with a set of core features. The software of medium complexity takes two to six months to complete and includes device adaptation, personalized UI/UX design, and integration of advanced features. It takes more than six months to develop highly complex software that is optimized for performance and hardware/software compatibility with complex development, design, and support.

Size of the Software

Size of the Software

During the planning phase, estimated software size is one of the most significant independent metrics that may impact the project’s completion date. 

  1. The size of the software and the number of people who will use it are directly correlated with the development costs.
  2. The number of screens and pages it has and the number of users it is expected to attract determine its size and user base, respectively.
  3. A small app typically has between 10 and 25 feature pages, a medium app typically has between 25 and 40 pages, and a large app typically has more than 40 pages.

Because it will need to be optimized and tested on a larger scale, large software will cost much more overall.



Consider the number of platforms that you want your software to support. Do you want a mobile app that works on both Android and iOS? Perhaps you require a platform-independent solution. Web-only services and desktop tools both have unique characteristics. The price will reflect all of this.

Development Team Location

Development Team Location

Building custom software can be significantly cheaper if you choose the right location. Due to a lack of skilled labor and high living costs, some destinations have higher rates of talent attractions than others. As a result, USA and European countries top the list with the highest salaries. 

Asian countries, for example, fall below this standard, making them more cost-effective for global businesses. For example, a Polish developer earns an average of $45K annually, so we recommend selecting a vendor with the best price-to-value ratio and the most cost-effective location.

Technology Stack

Technology Stack

Innovative technologies like AI, IoT, and RPA may also be incorporated into your software solution. While these technologies increase your app’s potential, they also raise software development costs.

People with specialized skills are needed for each of these technologies, and niche professionals always cost more. For example, if you want to use RPA, you will need to hire experts in their fields who can help the development team understand the tasks that will be automated. For example, if you want to use AI, you’ll hire someone who knows how various machine learning models work and knows mathematics.

Engagement Model

Engagement Model

How do you intend to collaborate with the developers? Do you need their less-intensive service or their exclusive expertise? There are three ways to hire: outsourcing, freelancing, and in-house

The most time and money are needed to hire, train, and invest in resources, but an in-house team can guarantee the best service. Freelancing is at the other end of the spectrum. The cheapest option is to freelance, but the quality of the work may suffer due to poor communication, unreliability, and lack of motivation. 

The best of both worlds can be found with outsourcing. It provides access to developers who are confident in their work, costing less than starting a new in-house team. There are three types of outsourcing:

  • Project-based or fixed-rate: You collaborate with a development team on a short-term project with clearly defined objectives and a fixed deadline. This may be economical, but it compromises flexibility and quality.
  • Cost per hour: You can hire a single developer or a team and only pay for the time and resources required for the development. In return, you may not completely control the workforce, and the total cost must be clarified.
  • Dedicated Team:  The outsourcing company will provide you with exclusive access to a development team and fully dedicated resources, ensuring better expertise and service quality.

A development team can consist of three to twelve people or more, depending on the project’s scope. A team has four key roles: developers, a QA tester, a UI/UX designer, and a project manager. Business analysts and database engineers are two additional roles that are needed for projects that are medium to large.

Extra Costing 

Extra Costing

While a client pays a software development company to build software, the service typically comes with additional costs that are unrelated to the developers’ hourly rates or expertise. If you want to avoid unpleasant surprises in the future, you should be aware of any additional costs that could add up to a lot of money to the bill.

For instance, software licenses that developers need to complete the project would have to be paid for by some organizations. Others should also consider the infrastructure costs, mostly from buying or renting software that would be used for the work and properly tested.

It’s Time to Sum-up

Every business’s path to digital transformation is unique. Software development costs are reflected in the different technical capabilities that businesses are pursuing in response to their distinct objectives. The technical complexity level, the team’s location, and other enablers all contribute to the overall cost of technical solutions. Therefore, you should first describe to a vendor the essential milestones of your initiative to obtain an accurate cost breakdown.

Eventually, the end product will usually reflect its price. If the cost of software development includes experienced developers, your project will be handled by professionals with more experience. Although no project is ever completely free of obstacles, this may reduce future issues.

You can use junior developers, or those with less than three years of relevant experience, to lower the cost of software development. Depending on your priorities, these developers will bring less expertise to the table.

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On-demand Ninja aims to deliver high-quality, cost-effective, and robust web and mobile solutions on time for clients across the globe. Professionalism, skill, and a team of dedicated developers are the core tools that we use to develop amazing solutions for your business bringing in lucrative yields on your investments.




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