How do app developer rates really impact project costs?
When you begin to create your own mobile app, the project budget often takes center stage.
Of course, everyone wants to get desired outcomes, while spending less money.
As a result, the hunt begins for the 'best offer', comparing rates from various development studios.
❗But here's the issue:
The rates you're comparing don't give any clues about the final cost of the project. None at all.
Let's look at some examples.
1️⃣ One client, before coming to us, spent two years with a Southeast Asian company.
This company offered low rates and promised to develop a tailored version of their software plus hardware for the client's specific needs.
It was unsuccessful. Two years and a lot of money wasted.
✅ When we took over and began from scratch, our first release was delivered in three months, including hardware selection and integration.
This feat was possible because we're genuinely capable of tackling such problems with our extensive project experience.
The key isn't low rates, but effective work.
Here's another example.
2️⃣ Recently, an entrepreneur approached us who had spent three grueling years trying to launch a product with an offshore team (he thought he found a pretty good deal with them :) ).
We won't dive into every detail now, but here's a key bit you should know.
The project had a big team with dozens of programmers. Among them, there were three guys who spent three years working on just one part of the product (which gives together nine man-years of work!).
But even after all that time, they still didn't finish it.
When we discussed the client's business logic and understood the business model he was building, it was obvious that there was no point in developing this module from scratch.
A smarter move was to take the best ready component available at the moment and integrate it into the platform being developed.
This would take weeks, not nine man-years.
And the developers' resources, time, and funding could then focus on other tasks.
❓So, why did the previous team spend so long on the feature?
Simply because they didn't bother understanding the client's business and seeking optimization. Well, if the client says it needs to be developed, they'll develop it.
So, did this entrepreneur save much with low rates?
💡 Some might rush to the conclusion: "So, we shouldn't skimp and go to those with high rates!"
Not so fast! The reality is far from it.
(Oh, if only things were that simple 😉)
Here's another story from our practice.
3️⃣ A client came to us and requested a code review.
He told us that he was working with his country's top and most expensive mobile development studio.
He had already spent about 400,000 euros on development, but nothing seemed to work properly.
Most importantly, he didn't feel like he was any closer to wrapping up his project. It seemed like it could go on forever.
🔍 After delving into the project's business logic, we found a surprising fact.
This top-tier studio had decided to cram the product full of fancy, trendy technologies (including artificial intelligence :) ), which were completely unnecessary!
In the end, we had to redo the project from scratch, costing about 100,000 euros (compare that to the 400,000 euros spent on an unfinished product).
As you can see, high rates and a studio's prestige don't solve the problem either.
🔑 What conclusions can we draw from these stories?
If developers don't understand your business and/or don't have the right expertise for your specific tasks, you'll probably spend way more than necessary - regardless of whether you go for low or high rates.
Plus, there's a high probability that the project will still fail.
❓ So, how do you choose developers so that you don't end up hurt by lost time and money?
We dug into this topic in detail in our checklist for choosing mobile developers (we sent you the checklist in our previous email).
But right now, we’d like to highlight a few points from it that fit well with today’s topic. These are the first-level questions to keep in mind when talking to a potential contractor:
1️⃣ Do the developers understand the core of your business? Or are they just coding away aimlessly?
2️⃣ Are you on the same wavelength? Do you feel you're talking to fellow entrepreneurs? Or is it all tech jargon to you?
3️⃣ Do they have a successful track record with similar projects, or will they use your project as their guinea pig?
4️⃣ Are they willing to break down the work into manageable stages, ensuring a clear, understandable result at each step?
Well, we hope this topic was relevant and helpful to you!
P.S. Would you like to find out about our approach to mobile app development?
Learn about the three simple, risk-free steps to create an app for your business: