Evaluating Your Budget: How Much Will It Cost to Build Your App?

In 2020, we all faced increased digitalization due to the coronavirus and subsequent lockdowns. According to the State of Mobile 2021 Report by App Annie, worldwide app downloads reached 218 billion in 2020, growing in 12 months by a volume of downloads that would have taken two or three years to achieve pre-pandemic. 
 
The App Annie report also states that the demand for new apps is still growing globally. Consequently, the demand for app development is growing as well, and the matter of its cost is especially relevant.
 
Relatively low prices and high quality are what everybody is looking for when hiring an app development agency, whether that agency is in the UK, the US, India, or Ukraine. We know this very well, as we provide web and mobile solutions for diverse business domains including healthcare, real estate, and logistics.
 
Needless to say, the cost of software development varies widely. Nevertheless, let’s try to figure out how much you might expect to pay for your fancy new web software, iOS app, or Android app — and what that money actually pays for when working with an outsourcing company.

What influences the cost of app development?

The cost of app development doesn’t only hinge on the development time and hourly rates. It depends on a number of factors, including the difficulty of finding talent, the complexity of the product, and post-release support expenses.

App development team

Depending on the project requirements, an offshore or local development team can be basic, extended, or complex (for enterprise-level projects).
 
At Yalantis, we compose parallel stream teams for enterprise projects. For instance, we create separate teams for web development, mobile app development, integrations, and so on. Each stream consists of a project manager, developers (their number and specialties depend on the platform), business analysts, quality assurance specialists, and UI/UX designers. There are also project managers and solution architects who manage each stream team.

Technical complexity

There can be tens of features that add technical complexity to a project. For instance, we built a platform for last-minute hotel room bookings with a sophisticated search filtering algorithm that’s connected with real-time discounts. When we built it, there was no available filter integration we could use, so developing the algorithm on our own was the only possibility. This led to extra development time and, as a result, a higher cost for the app. Other common examples of technically complex elements include:

Backend development

You might be planning a big dynamic app for millions of users who will exchange a huge amount of information in real time and will definitely want their data to be synchronized across platforms and stored in the cloud. In this case, you’ll surely need a back end that can withstand huge loads and work smoothly under any conditions, which will entail more time spent on designing and building a complex app architecture. Moreover, you’ll require multiple programming languages to create your app’s back end, which means you’ll need to pay for a more diverse team of professionals.

Niche third-party integrations

There are plenty of third-party integrations that can boost your development speed, including niche-specific ones. However, third-party integrations, especially niche integrations, sometimes provide inconsistent and complicated documentation. This can lead to additional time spent puzzling out how to integrate them into your app. In addition, you’ll likely have to pay a fee to use these services.

Payment gateway integrations

In an attempt to cater to the needs of a broad audience, business owners tend to integrate as many payment options as possible. And it’s a nice approach. The thing is, you should be prepared to pay extra for each additional payment option you implement: in-app purchases, PayPal, Stripe, Braintree, Google Pay, Apple Pay, etc.

Hardware components

Say you’re working on an app for shipping that uses an electronic logging device (ELD) to accurately track driving hours of vehicles in your fleet. Or say you want to build a smart home system that relies on Internet of Things (IoT) devices. To do this, you’ll need to purchase or rent ELD or IoT devices for software testing purposes, so you’ll have to account for the cost of this hardware as well.

Supported browsers, devices, and operating systems

When developing a web app, you should make sure it supports the latest versions of the top browsers such as Chrome, Edge, Firefox, and Safari. Otherwise, you risk losing some potential users for your web application.
 
An iOS app should ideally be compatible with the latest and the previous iPhone versions (e.g. iPhone 11 and 12) and support the two most recent versions of iOS (e.g. iOS 13 and iOS 14).

For Android apps, the number of devices that need to be supported is much greater. There are three factors that influence our decision about which Android devices to support:

  • The size of the market share for each Android device manufacturer
  • Devices popular on the market the app is being developed for
  • Our client’s preferences

 

These considerations also apply to Android operating system versions. We currently support versions from Lollipop (Android 5) to the latest for the majority of our projects, but a client can specify the exact versions to be supported.
 
Obviously, more devices will mean more time spent adapting the application for various screen sizes, resolutions, and hardware specifications. It will also mean more time spent testing. However, if you choose to support only the most popular Android devices, the cost of app development for Android will be essentially the same as for iOS.

Custom designs and animations

Custom user interfaces are rather complex to implement, so the cost of a custom interface will be higher than the cost of an interface built from standard components.
 
Custom animations make your app unique and can increase user engagement. In our article on types of animations and principles of their design, we discuss animations in detail and provide many examples of animations designed or developed by Yalantis. You can check out our GitHub repository for a full list of our open source projects.

Post-release expenses

The average app development budget isn’t solely comprised of the cost for programming. You should also take into account the money that goes into growing the product. As with any business, an app needs updates, customer support, and even legal support, not to mention application marketing and promotion, which have a huge impact on the product’s success.
 
If you integrate any third-party tools in your app, you’ll have to pay to use them. For instance, Stripe charges 2.9 percent plus 30 cents for any credit or debit card payment that you accept in your app. Keep these costs in mind when evaluating your app support expenses.
 
Unlike an app development team and costly app components, post-release support isn’t included in the initial cost estimate but rather is provided as an additional service by most software development companies. Let’s see how pricing might vary for app developers worldwide.
 
Read also: Creating Video Recording and Video Editing Features for an iOS and Android App

What hourly rate will you pay to build an app around the globe?

There are millions of great app developers on this planet, and you might wonder how they differ from one another. When you’re looking for app developers (or possibly a freelancer) to hire, try to pick those who have expertise in the industry your application targets, as they probably have both the experience and assets needed to finish your project in the shortest time. To see if a development company has the right background, you can search the company’s portfolio and check out client reviews. 
 
There’s no guarantee that going with an expensive company will get you an app that’s capable of giving a return on your investment. In fact, lower-priced programmers can provide excellent results. High price doesn’t always equal high quality. There are lots of factors that influence pricing. Geography is one of the most essential.
 
Let’s take a look at a map for the regional cost breakdown. In terms of the average hourly rates for mobile app development charged by service providers, we can observe the following:

  • US-based companies charge from $100 to $150 per hour.
  • Australian agencies offer their services for $90 to $120 per hour.
  • European developers charge rates between $30 and $55 per hour.
  • Ukrainian developers provide services for $25 to $50 per hour.
  • Indian developers charge rates of $20 to $35 per hour.

 

Great! Now we know the hourly cost of app development. What’s next?

How much does a web or mobile app cost?

Don’t expect a professional agency to tell you the price of your product out of the blue. There’s no such thing as a price list that can help you calculate the cost of mobile app development, and price calculators you may come across on the internet are nothing but cheap marketing bait. Agencies usually charge per hour, but rates can be negotiable.
 
The cost of making a mobile app (or a web app) is most often based on the number of hours the project takes, and the more difficult the functionality, the longer it will take to implement. 
 
We will show what impacts the cost of app development using the example of a real estate marketplace app. We will consider three categories of apps: simple, with middling complexity, and with highly complex features. We will give a rough cost estimate for a marketplace app in each category based on a $50 per hour rate, since it can be considered near-average.

  • A simple real estate app includes some basic functionality like simple search with filters and map integration. Such an app also has basic UI components and requires real estate agents to manually upload photos, videos, and other data. Developing a simple real estate marketplace app would take about 1,000 hours and could cost more than $30,000.
  • A real estate app of middling complexity may include custom UI components and real-time chat. Plus, this app could integrate with a customer relationship management (CRM) system for automatically uploading data and provide a user management system for creating users of different levels. User roles may include admins and real estate agents, with each role having different access permissions to the company’s data. It would take around 1,800 hours to build such an app and could cost more than $75,000.
  • A highly complex real estate app may have advanced analytics tools, a custom admin panel for business owners, and high-load capabilities to withstand a large number of simultaneous users. This app could also provide 3D modeling and virtual home tours. The timeframe for building a complex real estate app is about 2,400 hours and the price could be more than $125,000. A full-fledged social network application and a video streaming app may also fall into this category.

 

How do we estimate the cost of app development?

Before we do any work on your project, we provide you with a rough estimate for free. Let’s make that a little clearer. Before telling you how many dollars or euros you’ll need to develop your app, we’ll use our three-stage framework to deliver some actual value for your business. Here’s how it works:

  • First, you fill out our contact form. Then you schedule a call with our engagement manager. During this call, our engagement manager will confirm the details you’ve provided us and ask about your business goals and processes, possible user roles and journeys, app scalability plans, and so on.
  • Next, we process the initial requirements we’ve collected and perform basic business analysis, considering your product specifics, to offer a solution that meets your goals and expectations. Then we estimate it.
  • After that, the results of our business analysis go to our solution architect, who prepares detailed feedback with suggestions on the app’s structure, feasible use cases, and ideas on the technical implementation for the app.
  • After that, we hold a meeting to present our feedback to you, get clarifications, and elicit more requirements. During this meeting, we also try to specify the scope of work for your project (the features needed to cover your burning business challenges) so we can prepare an optimal project offer.
  • At the last pre-planning meeting, we present a project offer, which usually includes hours of work, a technology stack, an application architecture approach, and a set of product features for the initial and subsequent releases.   
  • Finally, we negotiate an offer to find the best possible solution for your business.

 

Once you approve the rough estimate, we proceed with a detailed estimate, for which we identify the requirements for each scope of work planned, make wireframes to show you what exactly your web, iOS, or Android app will look like, and prepare project-related documentation. 
 
We provide full-cycle development services for mobile and web apps. This means that the price we quote covers every service related to product development, including project management:

Requirements analysis + Design + Development + Testing & Verification
 

Iteration by iteration, the cycle repeats until your product becomes truly successful. To launch an app is not to complete the mission. It’s just the beginning. Be ready for a long-term collaboration with your app development team. We’ll be happy to back you up!
 

app development cost

[App development cost infographics]

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