Are you thinking about replacing outdated software with new one or probably require adding new functionality? If this is the scenario, you should probably go for it as it could help you optimize your business process and open new streams of revenue. Before you go in for hiring a developer, the best practice is to consult a custom software development company that can help with the art of estimating the costs that will be incurred in doing the needful.
What is cost estimation?
Cost estimation is the process of communicating precise and clear financial information to decision-makers that help in making cost-effective decisions. If this is so simple, why do cost estimates go wrong? No worries! We will help you estimate and manage custom software development and engineering costs the right way. The article will help you understand the basics for the estimation of costs.
How to estimate custom software development costs?
The cost varies from project to project. There are various parameters such as the complexity of projects, features to be added, and technologies or programming languages to be utilized for the estimation of custom software development costs. The price may scale up from a few thousand dollars to a million dollars depending upon the above factors. The steps below can ease the process of estimating the costs. Let’s catch a glimpse:
Discovering what you need
Getting to know what you actually require or what problem you need to address is the first step in estimating and managing custom software development costs. By discovering the problem, you will soon be stepping closer to knowing the essentials such as the technology stack to be used, features to be implemented, the need to outsource the software development process, and estimating time for development.
Evaluating the scope of work
To estimate costs, the evaluation of work is the next big thing. It is essential to be clear about no features to be implemented and the functionality the product is expected to have. Like when you proceed with working for startups, you need to start with developing a prototype followed by MVP. After doing the needful, it becomes imperative to get customer feedback to know whether you are in the right direction.
To get the right custom software development cost estimation, it becomes mandatory to divide the project into stages.
Determining the project complexity
The cost is largely dependent on the complexity of the project. The project may require a combination of software platforms, a mixture of programming languages, or different programmers with diverse skill sets. Many factors need to be taken into consideration such as the tech stack to be utilized, the role of the persons handling the project time constraints, team size, and hiring model.
Breaking down the costs in sprints and small tasks
Planning sprints the right way can help you with accurate budgeting. For instance, if you require to add a new feature, the best approach is to divide the cost of the feature into sprints. Each sprint is allocated a time duration of one month. You can calculate how long a particular task will take by dividing custom software development costs into smaller tasks.
Keeping track of unexpected costs or hidden costs that may occur
Custom software development cost estimation is not as simple as it appears. Some unexpected costs may arise during project tenure. It is essential to keep a close eye on the budget and clear out the costs to prevent further project cost deviation.
Breaking down the cost for correct estimation
Cost breakdown structure is a recommended process in cost estimation. You can add costs to each task that you think it would incur during the project lifecycle. You can add values at each level which would help you in estimating the overall costs of the project.
Following stringent quality practices
It is not just about designing and development but also takes a great deal to apply quality assurance practices to prevent costs from going out of budget or projects being delayed.

Conclusion

Estimating and managing custom software development and engineering costs could be challenging. There are various factors to consider such as team size, tech stack, quality assurance requirements, ways to prevent project cost deviation, and much more.

PrimaFelicitas can help you optimize your software development process and save you from all that effort. Let’s get started!