One of the most challenging things to do in custom software development is determining how long and how much amount it will take to deliver a new software product. But the question is, should it be so hard?

Software development cost estimation is inherently tricky, keeping the fact that “no projects are the same” in mind. Every product development is unique in what it sets out to achieve; it’s unique in the myriad of parameters that form its existence.

Another substantial factor in custom software development to be done by custom software developers is understanding the cost and duration of making strategic business decisions. Whether you are a startup or an established enterprise, know that the timing, return on investment, and benefits you make can either make or break your software development.

Your software development project cost may vary from $10,000 – $200,000 depending on the certain other factors that we are going to talk about.

Not just the cost range, there are certainly hundreds more questions to answer when talking about custom software development cost estimation. This is probably why we are here to help you explore the agile software development cost estimation process.

Before this, you might want to look at the ultimate guide to software development for a thorough perspective.

Let’s start with the basics and then talk about specific requirements to estimate the average cost of software development.

Factors that affect software costing

To calculate the cost of software development; understand that it majorly depends on three significant factors:

Factors that affect software costing

Let’s take a detailed look at these factors.

1. Type of software project 

From a high level, the typical custom software development arrangements tend to break down into the following details:

  • New software development – New software including custom software development
  • Software modification – The process of enhancing existing business software
  • Software integration – Adding a custom code to add the capability for integrating existing software into other processes. This would include plugins and packages such as “Office” and manipulating data flowing between an inventory system and an accounting system.
  • Web development – Custom web-based software development

Each software development comes with a different team makeup and requires an additional amount of development effort.

Understanding the type of software development for your project is the first step towards estimating development cost and categorizing software development cost breakdown. This comes in handy in the final estimation when you combine the type of your project with the size of the project development team.

2. Size of the project

The next critical factor is to determine the size of a project. The project size is typically correlated to the features and functionalities of the product you are building. This means the more complex your project is, the bigger the size of your project will be. 

  • Small-sized development

A small software project development usually needs a few minor changes. Typically, changes such as bug fixing and making tweaks to the user interface come into small software development. Here, client interaction is usually limited.

Approximate Software development cost range – $10,000 – $50,000 based on modifications

  • Medium-sized development 

Here the engagements are more substantial than just a small tweak and have a well-defined scope of deliverables. Typically medium-sized software development deals with a single source of data. Projects like small mobile application development, enhancing the web interface to the existing inventory system, or upgrading the UI/UX interface of the current website or app would fall under this category.

One prominent example of medium-scaled development can be Appinventiv redefining UI/UX strategy for Domino’s to increase its mobile app conversion. Here, the external requirements for client interaction are more precise and robust.

The interaction would also include a few design sessions, milestone sign-offs, and weekly check-ins.

Approximate software development cost range – $30,000 – $100,000

  • Large-sized development

These solutions include complexity and depth. Large-sized software development asks for a broad database, integrating multiple systems, and addressing logging and security features. If your project has to be maintained and scaled in the future, two common steps would be designing an underlying framework and module-based systems.

On the other hand, a multi-party application development well-versed with numerous platforms (Android, iOS, web) would also fall in the large software development category.

Below are a few prominent examples of large sized development:

Appinventiv developed Vyrb, a voice assistant application for social media for an eyewear brand that helps send and receive audio messages via Bluetooth wearables. Such full-fledged application development stands under large-sized software development.

Appinventiv also helped in expanding KFC’s mobile presence globally by developing an end-to-end app that enables real-time order tracking and doorstep delivery across Egypt and Middle East.

Adidas is one of the largest sports merchandise brands with a broad and diverse product portfolio. Appinventiv helped Adidas reach its extensive user base in Saudi Arabia and Qatar by expanding its web centric services to mobile through a dedicated application.

The client interaction here is super robust, i.e., milestone agreements and extended design sessions, daily calls with the technical team followed by weekly status meetings, and more.

Approximate software development cost range – $80,000 – $125,000 as per integrations


  • Enterprise-sized development 

Enterprise-sized software development is probably the most extensive and most complex project usually built on underlying frameworks. They have higher security, error handling, and more rigorous logging since the entire enterprise process is digitally transformed. Data integrity and security are paramount to such business-critical applications.

There is no exclusive exhibit; however, the support systems designed for enterprise-level development are resilient and can manage 2-3 concurrent faults in the core infrastructure without creating a user impact.

Coming to the client interaction, the process is fully integrated. Enterprises usually prefer outsourcing rather than in-house teams to design and architect their business-aligned software due to deadlines and easily met requirements.

Here are some of the instances for enterprise-sized development:

Appinventiv developed an enterprise-level ERP solution for the largest furniture retailer, IKEA. The objective was to ease the in-store onboarding to give users the real-time status of product availability and store consumer information. Know how much an ERP software development project costs.

Appinventiv also transformed a leading telecommunications enterprise into a customer-centric enterprise through its data analytics solutions. From data formatting to customer product optimization, the enterprise-level data management solutions upgraded the entire business database of the company.

Large enterprise data also needs to be protected using advanced crypto-centric banking solutions. Appinventiv developed and integrated crypto as a mainstream source of daily transactions for Asian Bank. The blockchain solutions not only helped the bank widen its horizons but also increased customer engagement extensively. Know how much blockchain app development costs.

Approximate software development cost range – $100,000 – $200,000 based on the type of software developed

3. Development Team size (As per project) 

Once your project is defined in terms of types and size, the only substantial factor that can directly affect your software development cost is your development team size. Your development team requires at least three roles – a developer, a project manager, and a QA tester to perform certain tasks in software development.

However, the requirements should be well aligned with your project. Below are the roles you can choose from according to your size and type of the project:

  • Project manager
  • Business analyst
  • UI/UX designer
  • Architect
  • DataBase expert
  • Developer
  • QA tester

The other factors that might indirectly strike your budget are:

  • Technologies used
  • The number of platforms utilized
  • Target group size
  • Post-maintenance cost
  • The experience of your development team
  • The geographical location of your development team

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