Do you wonder why over 66 percent of software development projects overrun costs? If you do, then this blog is for you as it’s set to present a guideline of best practices and tips in conducting good cost estimation for software development that will help you avoid the shock of cost as you develop your software.

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Why do we need software estimation?

Software estimation provides value to both clients and providers, as clients get information about the time required to complete the software development and approximate project budget, while helping service providers and developers organize workloads and set appropriate parameters. 

In software development, the overall project cost does not depend entirely on the scope of work, QA process, and the software development lifecycle’s maintainability. Other factors affect software development cost and cause unanticipated costing challenges, including:

  • Project Size 

The easiest way to define the size of the project is to count the number of possible features your future software will house. Complicated functionalities mean more time for software development and testing. To clarify how complex it might be, make a mock-up of your app or refer to a custom software development company. 

  • App Integration

Integrating your app with any external software creates additional difficulties and may cost you extra time and money. So if you are thinking of integrating your app with external software, you should estimate more cost for that specifically.

  • Creative designs 

If you want to emphasize the difference between your software and others, you should consider the cost of creative designs in your budget. Everything that your app consists of will be created from scratch according to your target audiences.

  • Data migration 

Migration of existing data into your new app may become another source of headache for developers. Data migration is a bunch of scripts that take data in one place and transfer it to another. But since the systems can store data differently, this seemingly simple process can cause additional problems, and as a result, you will face an additional cost.

  • The contract type

The contract type you select has a considerable influence on your software development cost. To estimate accurately, you need a good understanding of the contract time that suits your budget and time frame for completing the app. 

  • Fixed process approach

The fixed process approach allows you to define the final process if all features are in the scope of work. Any changes are taken as a change request and are being estimated additionally. 

  • Time and materials 

The time and material approach requires a daily engagement but diminishes the final product cost. Your engagement depends on the amount of work and varies from one hour to four hours per day. 

While many top influence factors can catch software developers unaware, the above-listed point is very helpful to set an accurate software development budget for your next project.

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