How to Reduce the Custom Software Development Cost?

Custom software development cost is one of the most important factors before starting your software project.

Custom software development from scratch is expensive. High prices for software solutions are one of the primary reasons why many companies still haven’t adopted any software for business purposes.

Fortunately, there are options for cost optimization in software development that can significantly reduce expenses and achieve cost efficiency. So, we decided to create a short tutorial with a checklist on software cost reduction, highlighting the most crucial aspects that impact the cost of custom software development project.

Top Strategies to Reduce Custom Software Development Costs

There are many approaches to software cost optimization. Each is efficient and offers a slightly different perception of what should be optimized or prioritized. However, we suggest combining the most popular strategies within a single project to achieve the best results.

Among the best practices to reduce software development cost, we can name:

• Prioritizing planning and requirement gathering
• Outsourcing software development
• Maintaining a small but skilled software development team (quality over quantity)
• Applying a Minimum Viable Product (MVP) development strategy
• Using cloud computing solutions
• Choosing the Agile Development Approach

Prioritize Proper Planning and Requirement Gathering

Planning is always the key to success. So, don’t underestimate this stage; pay attention to every detail.

One critical subprocess of the project discovery phase is requirement gathering. To simplify, requirement gathering assumes a clear definition of what software product you are building and why. It includes many technological aspects, such as the preferred platform or operational system, application architecture, or tech stack.

Still, software requirement gathering must also give you and your team a clear description and vision of the final product: every member should understand the core goals and metrics and how they can achieve them. Finally, don’t forget the importance of business analysis in software development and the benefits it brings to the table.

Requirement gathering is a top priority during the software planning stage. You can start planning your software development budget and roadmap only after having the requirement definition.

Frankly, the software planning stage is surrounded by many myths and mistakes. For instance, it is very easy to underestimate the impact of project planning on the outcome. However, it is also simple to overestimate your plans. So, the first challenge in implementing a software cost reduction strategy - is proper software planning and an appropriate attitude to your plans.

To simplify, remember that you can't predict everything when planning your custom software development project and its budget. Therefore, don’t get frustrated if something goes wrong during the software development phase, and you must spend additional resources or reschedule your product delivery. Consider your project plan as a long-term strategy instead of a step-by-step tutorial.

Outsource to a Dedicated Team

Salaries are one of the most significant and well-known factors affecting the cost of custom software development.

Software development outsourcing is an established phenomenon among companies primarily based in the US and Western Europe. Outsourcing allows businesses to delegate software design and development to software engineers worldwide.

Outsourced software development teams offer their experience and skills as a service, developing projects for companies on demand. However, dealing with outsourced developers can be tricky and include certain risks.

For example, you must find a reliable software vendor with proven expertise and enough experience to deliver the software product you need. Besides, you must plan and set up efficient cooperation practices to monitor and track progress, updates, etc.

One of the most common mistakes in software outsourcing is choosing an inexperienced development team. Many businesses prioritize software development budget over quality, choosing the cheapest options on the market. There are many reasons why this is wrong, but the most vital argument against such a policy is the expense:

Hiring the cheapest developers on the market will likely result in poor software quality. As a result, you will have to spend even more money and time fixing and optimizing the product. Moreover, dealing with existing products is much more complicated and resource-intensive than developing one from scratch.

Hence, here is a shortlist to find a reliable development team to reduce software development cost:

1. Examine your candidates, look for reviews and case studies
2. Look for a team familiar with your industry
3. Get prepared for interviews, and ask as many questions related to your project specifics
4. Discuss your ideas with the IT vendor and let them estimate the project
5. Choose the best and most suited candidate

Once again, when looking for a software development team, pay attention to its previous projects, relevance to your industry, tech expertise, and, only then, its price.

Keep Your Development Team Small but Skilled

Continuing the discussion about salaries, there is a forever debate: quality vs quantity.

As a business owner looking for a development team, you must choose between finding fewer developers with more experience or hiring more developers with less expertise. Even though each solution can be beneficial in specific contexts, our Incora team suggests choosing quality over quantity.

Highly experienced developers were always a desired addition to the team. However, their salaries are noticeably higher, making it harder to balance your team. Clearly, it is irrational to hire senior developers and delegate them tasks of junior developers.

Nevertheless, hiring middle developers can be a great way to find the required balance: broader experience (compared to juniors) and lower salary (compared to seniors). Moreover, thanks to the rise of artificial intelligence tools, coding processes have become much more straightforward, helping developers to cover and automate many code-related processes.

Building a team of middle software engineers can save businesses costs and improve results and software quality. Such developers are experienced enough to avoid common mistakes or bugs, ensuring clean code and efficient and scalable IT infrastructure. So, it can save you money later during the software support and maintenance stage.

Prioritize Features Using MVP

Minimum viable product development is the best methodology to save custom software development cost.

MVP concept was initially designed for startup projects, considering the potential need for more experience and resources for a successful launch. So, the main principle of MVP development is to “start smaller.” To rephrase, MVP suggests developing the bare minimum instead of creating a full-scale application with multiple features and services.

You can easily define software applications' core features and specifics if your discovery phase is correct. Additionally, this makes it possible to postpone other tasks and processes for later, prioritizing the core app. Hence, your team can develop an app faster, reducing IT costs for development.

Apart from software cost optimization, MVP development also helps to reduce risks by:

• Delivering software products faster
• Allowing to perform deeper user analysis
• Redesign and upgrade the app according to the market demands

To cut a long story short, MVPs are much cheaper than any other custom software development cost, and they are also faster and more flexible. So, you can design an MVP with IT architecture for future scaling and test your target audience, learning its demands and expectations. Eventually, after completing all the preceding steps, you can upgrade an app to meet these expectations.

Leverage Cloud-Based Solutions

Cloud computing offers countless benefits, especially for projects with limited software development expenses.

Cloud services are cheaper than more traditional software and hardware solutions. In addition to more affordable maintenance costs, cloud services offer a full-fledged software infrastructure, best security practices, and overall maintenance support.

Once again, it is highly beneficial when you have limited resources or need more experience working with backend and software architecture.

Still, cloud computing is helpful for small and middle businesses' custom software development costs. There are many payment options and approaches, yet most scale with the number of company employees or software complexity. So, an enterprise-level company will pay far more for the same cloud services package than a small business.

Focus on Agile Development

Last but not least, consider an agile development approach.

There are many ways to maintain a software development lifecycle, yet agile is the most beneficial in terms of uncertainty or a limited budget. Long story short, agile development assumes constant meetings and discussions on progress.

As a result, every participant will stay updated on the project status. Besides, when developers face issues or develop ideas on improving the software or simplifying the project, they can discuss them with the product owner. So, both parties can agree on the scale of work and implement changes regarding agile development.

It is beneficial for IT cost reduction and management. For instance, your development team has brilliant ideas for future services or features that will bring much value to your product. However, their implementation takes time and resources, which you need. So, you can agree to postpone these ideas for the future. Alternatively, during the development, software engineers found a way to speed up the development by sacrificing a few unused features, giving you a chance to reduce the custom software development cost.

The variety of such unplanned solutions is surprisingly huge during any software project, so don’t underestimate the potential of agile methodology and its possible impact on cost optimization in software development.

Our Approach to Optimizing Software Development Costs

Frankly, generalizing the best software cost reduction methods still doesn’t explain how it can help. So, for a better illustration, let’s consider how we plan and design projects in Incora to reduce software development cost.

Focus on Early Planning and Detailed Requirement Analysis

First, we pay the maximum attention to early planning and detailed software requirement analysis.

Thanks to prioritizing the early discovery phase, we can define the most vital aspects and prepare questions for the business owner to clarify various aspects of the task. Also, detailed planning and research help to accurately determine the market demands and potential challenges along the way.

When we have all the required information, our team can proceed to plan the software project and fulfill its needs, choosing technologies and other software solutions, etc.

Afterward, we will have the approximate development plan, estimate this project's custom software development cost, and make adjustments if needed.

Judging from our experience, the more details you clarify during planning, the more future improvement options you will have. Besides, detailed planning and discovery help design a tailored solution.

Tailored Project Management for Efficient Delivery

One of the most efficient practices for IT cost reduction without sacrificing functionality and development time is to design and develop a tailored project.

To do so, we define future software apps' core features and services and plan the development to fulfill them. Thanks to the MVP approach, we can deliver the desired result without all the extra work or aspects.

Additionally, we apply tailored project management to achieve the most efficient and productive development cycle. This approach is ideal for custom projects and helps maximize development efficiency.

Using Agile Methodologies to Stay Flexible

Eventually, we chose the agile methodology over any other alternative because it fits our development strategy the best.

Thanks to agile development, we can deliver the most customized and fitted software solution to meet all the requirements and achieve the most balanced custom software development cost.

To sum up, our approach to optimizing custom software development cost is highly personalized, ensuring clear communication with the client and understanding between parties.

This is the only scenario in which we can agree on the core software functionality and allocate all resources to achieve the best results, even if our resources are limited.

How Incora Helped Clients Cut Development Costs?

Apart from setting up customized software development and delivery, we can also use other practices for software development expense planning and management, if needed.

Reducing Costs Through a Business Analysis and Clear Requirements

Business analysis is among the many services we offer.

Our business analysts can define your needs and capabilities, helping to design and deliver the most affordable and suitable solutions that meet your resources and demands.

Proper and accurate project estimation is almost only possible with correct business analysis and knowledge of its requirements and supplies. We commonly suggest our clients use business analysis services, which can improve software development and provide our customers with a better understanding of their business and its needs.

Choosing the Right Platform to Save Long-Term Maintenance Costs

Additionally, we discuss the goals and expectations of the software solution to choose the best platform for its implementation. For example, depending on the client’s needs, we can suggest the following:

• Web app development
• Building mobile application
• Creating desktop software app

These types of software have variations, such as native or hybrid mobile applications, traditional or progressive web apps, etc. Some of these solutions can significantly help in software cost reduction by offering a multi-platform solution for various purposes.

For example, your main goal is to increase your audience reach and improve your presence on the online market. In that case, you might benefit more from web development, while building native mobile apps gives you more instruments and unique features if your business aims to offer new innovative solutions. In other words, depending on your business goals and resources, you can benefit more from specific platforms.

Besides, website maintenance costs differ from those for supporting mobile apps, which can be a real deal-breaker in the long term.

Agile Approach and Small Team for Faster Delivery

Finally, to achieve the best results regarding resource-limited projects, we offer cooperation with small teams of niche-experienced developers in an agile development approach.

As a result, businesses have a well-managed working environment with fast and personalized approaches to fulfilling all needs within a limited budget. Moreover, a small but experienced team is much easier to maintain and manage, giving a better and deeper understanding of the current status of a software project.