How Much does Outsource App Development Cost in 2019?
With smartphones overwhelming our lives, a new motto for brands should definitely be “Go mobile or die.” According to recent research, 205.4 billion iPhone and Android apps were downloaded in 2018. Another study by App Annie projects these applications to bring $188.9 billion in revenue by 2020. Sounds impressive, right? And if you haven’t created a mobile app for your business yet, it’s high time to think about it. Especially, when you can delegate this task to a team of professionals. Yet, you may wonder how much will outsource app development cost. We are here to clarify this point, as well as some other essential details for your best-in-class application creation.
Want to Create a Mobile App? What You Should Know Before
Let’s assume you have already decided to build an application which will conquer the market and make your customers fall in love with your company. Congrats, you are on the right way. Still, one tiny yet extremely essential detail is missing: how to do it?
Actually, there are two ways to go: either to create it in-house or to outsource app development. Before you choose one of these options, let us help you estimate the potential benefits and risks of each. We will also figure out together which solution is better for your particular business needs and how much does it cost to hire an outsource or in-house team of mobile app developers.
Small Checklist for Your Big Application Idea
A distinctive feature of all successful projects is thorough preparation, and mobile app creation is no exception to this rule. That’s why, before starting to search “How much does it cost to outsource app development?” you should have a clear vision of what you want to get in the result. Our small checklist will help you to shape it:
1. Come up with a great documented app idea
It’s the initial stage where you should clarify which type of the application you need, which functions it will perform, and what for do you need it.
For example, it can be an app for product sales, tickets search for travelers, restaurant reservations, hotel bookings, delivery tracking, company presentation, employees training, etc. Also, define whether it will have a user login, GPS or phone camera integration, as well as if it needs online payments. Once you are done with its goals, go to the next step.
2. Define a business model of your future application
Here, you’ll need to decide whether you are going to get revenue from it or not. Perhaps, if you are outsourcing app, you’ll be positive about making it profitable. In such case we recommend to consider one of the following monetization strategies:
- Freemium, which presupposes just some basic features available to your users with a possibility to buy a full app version. This business model can also include a free trial (like in Google Play Music) or a limited number of users (like in Dropbox).
- In-app purchases. Normally, it’s more common for game apps, where users can buy some virtual items. Yet, Tinder also managed to enable this model by offering its users some additional credits at an extra price. This means you can think of possible use of this monetization strategy in a non-gaming mobile app as well.
- Advertising, with the vivid case of Instagram. Though, it’s quite an ambitious model, as you’ll need at least 100.000 monthly active users to be able to sell ads in your application. Note that the cost of outsourcing mobile app development can rise significantly if you want to create such type of a social platform, as it’ll require more features and time on their implementation (we’ll touch upon it a bit later on).
- Paid app, which means your users should pay for downloading it. This option is a good idea for companies with strong brand awareness but can be a failure for startups, as there are too many free apps available to make a user pay for a similar one.
Think over all these strategies before you find a team to outsource app development. This will allow you to calculate possible return on investment and avoid spending your budget in vain.
3. Choose the platforms for your app
Although outsource iPhone and Android app development cost is usually the same, the functionality can vary. For instance, most Android phones have a separate button for returning to the previous or home screen, while on iOS this action can be done by the “Home” button.
4. Development team
At this point, you’ll need to know for sure which specialists you need. Typically, these are designers and developers. But depending on the complexity of your application, the team can extend with marketers, copywriters, project managers, etc. Obviously, the more people are on the team, the higher will be the cost of outsourcing mobile app development.
5. The app development cost
In other words, you need to clarify your budget and the average price for in-house and outsourced app development. In the next few paragraphs, right after pros and cons, we will compare the crucial factors which influence the final cost.
Why You Need to Outsource Your App Development
Now that you know the basics to start with, let’s try to identify the pros and cons of different approaches to building your application. This will help you to understand if you are choosing the right way to go, as well as set an optimal cost of ordering your mobile app development from an outsourcing agency.
In-House App Development
First, let’s have a look at the advantages of hiring an in-house team, compared to mobile app development outsourcing:
- Internal developers know the ins and outs of your brand. Which means they’ll spend less time on diving into the specifics of your product and customers. Having insights about your goals, target audience, as well as competitors, it can be faster for them to craft exactly the app you need.
- Streamlined approval process and instant amendments. The reason is obvious: while all the stakeholders belong to the same organization, it’s easier to ask for approval and receive it. It’s also a bit faster to get feedback and make the necessary improvements in comparison with an outsourcing company, engaged in development of your app. At the same time, such revisions can be a stumbling block, and we’ll examine its dark side in the disadvantages.
As you might have already understood, there are some drawbacks of the in-house mobile app development as well:
- Too many revisions. We’ll start right with the last advantage, which can turn out to be a nightmare instead of a benefit. On the contrary to the application development outsourcing agency where you have a limited number of revisions, you may be trapped into a never-ending round of improvements. This will not only delay your application launch but also make you go over your budget without even noticing it.
- Higher costs of app development. The problem lies not only in the previous problem with looped revisions. It also deals with hiring or training staff. While huge enterprises can afford themselves having an in-house team of developers and designers, for mid-sized or small businesses application development outsourcing is much cheaper than finding the right professional.
- Time to market. As mentioned in the previous points, the longer you’ll search for the full-time developers for your project, the later you’ll have a ready-made application. Think about it if you want to win the competition in the ever-changing market environment. Sometimes, it’s better to pay a higher cost for the development of your mobile app to an outsourcing agency, than sacrifice the precious hours of launching your product.
Outsource App Development
Time to consider what benefits you will get when addressing an external agency to outsource the development of your app:
- It saves your time. An agency already has hired the necessary developers, so all you need to do is to choose the right company according to your budget.
- It allows optimizing budget. If you choose an agency from Eastern Europe or India, the hourly rate can drop to $40–50 or even $30, accordingly. Just to compare: the US outsourcing developer will cost you $100–150, while Western European—$10–100.
- It reduces risks. In case your brand-new product won’t be a success, you won’t have to regret spending time and money on hiring and onboarding an expensive in-house team. Also, you can be sure that you get the product you need at a price you have agreed with your contractor, without paying for some unexpected things, like sick leaves, etc.
- It empowers transparent communication. Though you may be afraid that you won’t be able to see progress on your projects, there’s no need to worry. A credible outsourcing agency will always supply you with timely reports and arrange e-meetings whenever it is convenient for you.
Advantages of outsourcing application development
On the contrary to the internal app development team, an outsourcing one can be not suitable for you just for a couple of reasons:
- You may need to pay extra money for the new features. Unlike with the in-house developers, you will have a limited number of rounds for introducing changes. Usually, this is fixed in the agreement, along with the scope of work.
- It can take a bit more time to explain the specifics of your product. Though, as compared to the internal team, if you provide an agency with a detailed brief, you get on the same page much faster.
How Much Does Outsourcing App Development Cost?
As soon as you are aware of all the pros and cons, let’s talk about how to find an app development team which will become The One and Only for your business. Checking outsource app development cost will help us make a final decision.
Of course, you should remember that the average price for developing an application can differ, depending on the location your team is from—starting with $25.000 and up to $100.000 and more. Depending on what features you want, the cost of an app can increase from $10.000 if it is a simple application to $200.000 and more for a complex one.
So, let’s have a look at how hourly rates for outsource app development vary in different countries.
Time is Money! Or Hourly Rates for App Development
In some locations, like the US, Canada, or Australia, you will have to pay quite a lot for the app developers’ time. Yet, there are some regions which can deliver you the same quality at a much more affordable price. Below, you’ll find out the compared cost of outsourcing mobile app development for iOS and Android in different countries and locations.
Average iPhone and Android outsource app development cost by region
As you can see, in some cases outsource Android app development cost will be lower than that one of an iPhone application, though mostly the rates for them are similar.
How to Plan Your Budget for It?
As mentioned above, when choosing a company to outsource iPhone app development (or Android, whatever you need), it’s better to take into consideration the complexity of an application. The more features you want to include into it, the higher will be the price and the longer it’ll take to develop such an app. Be ready that such options as a possibility to sign-in with social media, upload videos and images, leave reviews, sync data with external systems, etc., can result in increasing your budget and delaying the launch date.
To help you clarify how much your particular application can cost, we have gathered approximate price ranges for the most popular app types. Please, note there can be a huge difference in price which is explained not only by app complexity but also by the fact you want to hire a well-known agency. Surely, the services of a small outsourcing team will cost you less:
- Application without an Internet connection will be one of the cheapest: less than $15.000. It can be something like a calculator when no access to the network is required.
- Data-consuming app (which means it isn’t supposed to generate any information or media) like weather forecasts or calendars can cost from $20.000 to $100.000.
- Social media application like Facebook or Instagram can have a $25.000–$500.000 price range, depending on the number of features in it.
- E-commerce application like a simple clothes online store or a complex one like Amazon can cost you $40.000–$1.000.000.
- Messaging app will require a budget from $50.000 to $150.000.
Median costs for outsourcing application development by company size
Total Costs of the Development of a Mobile Application
Finally, you should mind that different stages of outsource app development can also impact your budget. A study by Clutch reveals more precise numbers for each of the steps, based on the survey of 102 mobile app development agencies.
- Planning includes the discovery of the project by an outsourcing company, conducting market research, creating a project’s timeline, as well as prototyping a future application. Most of the agencies charge less than $5.000 for it, while 22% of them will need from $5.000 to $10.000.
Design stage will cost you from less than $5.000 (32% of respondents) to $50.000 for nearly 11-20 screens of the application.
Development will take the most significant part of your budget, and you will have to pay for each feature at least nearly $5.000, or even more in some complex cases.
Testing and deployment normally vary from $5.000 to $10.000 (63% of the agencies), with the rest of them wanting more than $10.000 or $25.000.
Maintenance and support after the app launch will cost you either less than $5.000 or up to $10.000 per year.
To sum it up
When you’ll finally come up with the documented app idea, you’ll need to make your own research in order to choose a company that fits your demands, goals, and budget. But, at least now you know the approximate price range and won’t be shocked when an outsourcing agency sends you a quote or project calculation.
In any case, we are always happy to surprise you with top quality and reasonable prices. So if you need a top-notch app without spending a fortune on it, contact us, and we will gladly discuss our possible cooperation.