How much does Software development cost? [Breakdown estimation 2024]

calender May 22, 2023
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Sunil Kumar

Principle Solution Architect

The average software development cost ranges from $5,000 to $300,000, depending on the type of software because every project has different developers, technology, development strategy, and business goals. The global revenue of the app market, on the other hand, is estimated to reach $641.10 billion by 2027.

While on the monetary side, the outcome is much greater than investments, there’s a catch.

Custom software development requires very detailed, effective planning, strategy building, and process management to ensure the produced outcome is lucrative for an organization. And all of this comes at a cost.Therefore, software cost estimation is an integral part of the development process. It allows you to manage costs while identifying elements in the development process that could increase the costs. As a result, every software development project requires a software development cost calculator or a team that would see their requirements and give an estimate.

What is Software Development?

Software development refers to a set of computer science activities devoted to the process of creating, designing, deploying & maintaining software. The software itself is the bundle of instructions or programs that guide a computer on what to do.

In simple terms, the software developer’s roles & responsibilities include creating & managing computer programs that run desktop computers, mobile equipment & even automobiles.

Importance of Software Development

Software Development is the path to the success of any business or organization. As the technology continues to grow, companies need to know how software can help them become more efficient & competitive in the industry.

  1. Increased Efficiency.
  2. Improved User Experience.
  3. Enhance Security.
  4. Cost Savings.
  5. Streamline Collaboration.
  6. Data Collection & Analysis.
  7. Increased mobility & accessibility.
  8. Scalability and flexibility of solutions.

How much does it cost to develop software?

Figuring out the software development cost is important before you start building it. The average cost of creating software fluctuates over a wide range. The technicalities & types of software play a crucial role in determining the cost of development.

The cost of software development may range from $10,000 & can exceed up to $10,00,000. However, the total amount mainly depends on the number 7 complexity of software features & design patterns. In addition, factors such as the type of development (custom, low-code or platform-based) & the team involved (their roles & location) play a crucial role.

At Ailoitte, the cost of creating software is very affordable & flexible.

The table below includes an average cost of software development for various custom software –

Custom SoftwareCost of Development
SaaS$25,000 to $50,000
Web Application$8,000 to $35,000
Mobile Application$6,000 to $45,000
eCommerce Software$12,000 to $30,000
Content Management Systems (CMS)$10,000 to $45,000
Customer Relationship Management (CRM)$15,000 to $40,000

You can expect this cost range for building basic or standard custom software, but the software development pricing models will vary if you have different or more advanced requirements for yours.

What Factors Impact the Cost of Software Development? 

As mentioned above, multiple factors can determine software development expenses before and during the process. Therefore, you must strategically evaluate every element in the process to estimate, plan, and manage the development costs for your software.

  1. Software Type/Category
  2. Software Complexity
  3. Development Type and Platforms
  4. UI/UX Design
  5. Third-party APIs
  6. Location of Developers

Software Development Cost Breakdown

I. Software Type/Category

The type/category of software you are building determines the overall development costs. Are you making custom software? Are you building a healthcare application? Are you building an e-learning + social media application? Are you creating a SaaS product? Each of these choices requires a different approach since their development costs vary.

For example, an e-learning app needs User Registration, Profile, Available Courses, and Payment Features. However, an advanced e-learning app with social media would require many innovative features like Geolocation, Email/Phone Number Verification, Feed, Chat, Group Chat, File Sharing, and Premium Subscriptions.

Every type and category requires a software development cost analysis for a specific market, target audience, industry giants, and risks associated with the projects. They all allow you to formulate a better development plan and help you estimate the exact development costs for your project.

Software CategoryCost
Enterprise App$35,000 to $60,000
NFT Marketplace$25,000 to $55,000
SaaS$25,000 to $50,000
Fintech Mobile App$20,000 to $50,000
On-demand Mobile Apps$15,000 to $55,000
Mobile Games$15,000 to $45,000
eCommerce App$15,000 to $45,000
CRM$15,000 to $40,000
Web Application$8,000 to $35,000

II. Software Complexity

The software complexity depends on the basic or advanced quality features, functionality, and user interface. A basic solution with less complexity (an MVP) has core/fewer features, simple functionality, and a decent user interface. This type of software is ideal for the first version of your product as it allows you to understand the potential of your software in the market and identify flaws in your approach.

Advanced software with high complexity has multiple innovative features, technology like AI and AR/VR, visually appealing UI, and convenient user experience. Such software usually requires more planning, development hours, and a flexible budget. That is why most organizations build advanced software after monitoring the performance of the MVP/basic version.

Software ComplexityCost
MVP/Basic$5,000 to $15,000
Standard$25,000 to $60,000
Advanced$80,000 to $2,50,000

III. Development Type and Platforms

Evaluating the software platforms becomes crucial when building Android and iOS mobile applications. Operating systems like Android, iOS, macOS, and Windows have different requirements and standards. And as a result, the costs of building software for these platforms can vary. Deciding platforms for your app/software can bring either success or failure. Therefore, you must research which platforms your target users use the most or build a cross-platform application.

With the right team and strategy, you can build a high-performance cross-platform app to save costs and excessive effort.

You have two choices when building an application, Native and Cross-platform. With Native, you create a separate application for every platform, which includes a different codebase for every OS, longer development time, late deployment, and higher software development costs.

With cross-platform, you can use a single codebase, development process, and budget to build an application for all platforms like iOS, Android, and macOS. While some industry experts argue that the performance of a cross-platform app is less superior than Native, it involves fewer development hours, faster deployment, and cost-effective development.

Android (Native)$45,000 to $80,000
iOS (Native)$40,000 to $80,000
Cross-platform development$20,000 to $40,000
Web$15,000 to $60,000

Contact us to know the best price from Ailoitte Technologies

IV. UI/UX Design

Something you will often hear in the software building industry is the significant role of the user interface and experience in the success of any software. The UI/UX determines the visual experience and the ease of use of your software. For example, your software has a bad interface if it has random color combinations/graphics, longer loading time, complex features, and confusing navigability. It has a good interface if the color combination/graphics are personalized and customizable, the loading time is short/fast, and the software has innovative yet simple features and highly convenient navigability.

Another example would be the buying experience in any food delivery or e-commerce app. How quickly users can Open the App, Find the Product, Purchase the Product, Share their Location, and Make the Payment determines the good or bad the user experience of an application.

You can never compromise the quality of the user interface and experience since it can lead to customer defection and decreased user acquisition. However, the costs for software design can increase significantly without proper budget planning and project timeline management.

Software DesignCost
Basic $5,000 to $10,000
Standard$12,000 to $15,000
Complex$18,000 to $25,000

V. Third-party APIs

Those services that you can incorporate into your software by paying for and acquiring them from a third party. Some examples are –

a. Google Maps API – Location

b. Twilio Conversation API – Chat

c. Onesignal REST API – Push Notifications

d. Auth0 API – Social Login and Authentication

Third-party APIs are necessary for software to improve the user experience by including advanced functionality like location tracking, live chat, and social login. They help you ensure a convenient user experience in your software, which can increase user acquisition and retention.

While not all software requires APIs, you must evaluate their need in your software from the beginning to understand how they affect the development process and costs. Most APIs are free to use for developers, but some require monthly or yearly payments.

For example, Twilio conversation API for chat is a paid API, and you check its pricing to see how it will affect the development costs.

VI. Location of Developers

Software development costing more than necessary is usually due to the location of developers since teams from various countries have different rates. You can hire an in-house team, or freelancers, or outsource to developers from your country or another. But depending on your country, you may want to compare some prices from other countries before hiring any development team. Depending on where you are, you may find top-tier solutions from developers in another country at much lower prices than yours.

For example, developers from the US will cost you significantly higher than a software development company from a country like India or Ukraine, while providing quality-driven solutions.

CountryJunior DevelopersSenior Developers
USA$45 to $60$80 to $100
UK $40 to $55$75 to $90
Ukraine $35 to $40$45 to $50
India$25 to $30$35 to $40

*Outsource your project with Ailoitte

How to Reduce Software Development Costs?

Creating any kind of software might sound expensive, but there are many ways to reduce the costs. Here are some ways to fix that – 

I. Connect with an End-to-End Offshore Software Development Company

When you partner with an offshore software development company like Ailoitte, we will help you test your idea’s viability & provide in-depth insight. Additionally, we will give you a pool of experienced developers at affordable prices. For example, offshore software development rates in India will always be more reasonable than the cost in the US.

II. Classify Discovery Phase

You can explore the business model throughout your software product discovery phase i,e., the research stage. You can also get time to evaluate the cost implications & understand the technical requirements. In this way, you can decrease the software development time & costs to develop features & functionalities.


By approaching the MVP to build the product can help to understand the user’s behavior, identify bugs, the business model’s visibility & the acceptability of the idea in the market. Moreover, it will provide you with real-time user feedback, so you can modify functionalities & convey the required solution based on it.

IV. Hire Dedicated Developers

If you are looking for an in-house option, the best is to hire dedicated developers from Ailoitte – an offshore software development partner. We will give you a team of experienced professionals at an affordable price.

*Recommended section: Hidden Costs of Mobile App Development

Software Development Process

The software development process consists of four major steps. Check out the following steps mentioned below –

Step 1: Needs identification

It is a kind of market research & brainstorming stage of the software development process. Before building software, it needs to perform extensive market research to determine the product’s viability. Developers must identify the functions & services of the software so that its target customers can find it necessary & useful. The software development process starts only if the product satisfies every guideline necessary for its success.

Step 2: Requirement Analysis

The requirement analysis is the second phase that involves developers, users, testers, project managers & quality assurance. Also, where programmers choose the software development approach such as the waterfall or V model. This phase provides a detailed configuration of every component, the scope, the tasks of developers & testing parameters to dispatch a quality product.

Step 3: Design

Design is the third stage of the software development process. Here, architects &developers draw up advanced technical specifications they need to make the software. The Design Specification Document (DSD) specifies the architectural design, components, communication, front-end representation & user flows of the project. This step provides a template for developers & testers to reduce the chances of flaws & delays in the finished product.

Step 4: Development & Implementation

The next step is the development & implementation of the design parameters. Following company procedures & guidelines, front-end developers create interface & back-ends whereas database administrators create relevant data in the database. The programmers also examine & review each other’s code.

Step 5: Testing

The testing is implemented to check the software for bugs & verify its performance before reaching out to the users. The experts verify the product’s functions to ensure it performs according to the requirements.

Step 6: Deployment & Maintenance

Once the software is detect-free, the developers can present it to customers. After the release of the software, the IT software development company organizes a maintenance team to manage the client’s issues encountered while using the same.

Software Design Costs

Once the software is successfully developed, it’s time to design the same. The cost involved in the entire process of defining an overall structure such as software methods, functions, objects & interfaces of code. It is a method that converts user requirements into a suitable form for the programmer to employ in software coding & implementation. There are three levels of software design – Architectural Design, High-level Design and Detailed Design. 

Click here if you are looking forward to know more about Software Maintenance Costs.

How Long Does it Take to Build a Software?

It is difficult to provide a certain time frame without knowing more about your particular product & the requirements for development. But when you are developing a software product, it’s important to have a clear timeframe & to work with a development team to establish deadlines before the project starts.

On average, we see a software development timeline of 4-9 months. It can vary significantly depending on a number of factors, including the complexity of the product, the size of the development team, and the chosen project management approach. 


Estimating software development costs is a straightforward and easily manageable process if you prepare the budget for planned and unexpected elements in the project. The rest is an evaluation of your project requirements, developers, software complexity, necessary resources, and project timelines to determine the exact development costs.

However, reducing the software cost estimation throughout the development journey is necessary for most startups; and compared to other strategies, Agile software development costs are considerably lower and easier to manage than others. Industry experts recommend the development methodology for accelerating development, increasing collaboration, improving product quality, and reducing development costs.
*Reach out to our experts to reduce software development costs & create your software at a very affordable & flexible rate.

Frequently Asked Questions

How much does software development cost in the US?

In the US, software development costs for a standard system can range from $50,000 to $200,000.

How much does software development cost in India?

In India, software development costs for a standard system can range from $25,000 to $150,000. At Ailoitte, the software development rates are very affordable & flexible. Enquire now

How long does it take to develop software?

The time required to make custom software depends on the project’s complexity and requirements. For instance, software with an extensive feature set will take longer to develop compared to software with a minimal feature list.
The development time for complex software can vary between 9 to 12 months, whereas, simple software can be developed in 4 to 5 months. 

Why is developing software expensive?

It is not expensive. The software development costs always depend on business goals, software complexity, UI/UX design, development strategy, and the location of software developers. So, the rates can be lower or higher depending on these factors, but the development cost is always what it is supposed to be according to your requirements and business goals.

What is the biggest cost of software development?

Application testing and UI/UX are two major cost drivers in software development. And the biggest software development costs can range from $300,000 to $450,000 or higher based on requirements.

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