Why Application Development Costs a Fortune

If you have ever investigated building an application, whether, for a computer or a mobile device, you have probably come across the fact that it can be costly to develop a fully operational application. We have investigated the reasons why software development can cost so much, especially in the United States.

Let us look at some data points:

  • In 2019 the median annual wage for a computer programmer in the US was $86,550, according to the Bureau of Labor Statistics.
  • Most Development requires multiple rounds of implementation
Agile Development Method

Programming is generally easy once you have learned the ropes, but good programming is hard. Lots of developers can rush out work, but a good developer will take the time to analyze the use case and other factors to implement a better overall solution. So naturally, better programmers especially those in the US are in high demand. High demand means higher salaries. Considering a team of five average programmers, that would cost you $450,223 + 18% fringe totaling over half a million dollars.

Let us look at the alternative, which is to outsource your application development to an offshore team. Either in Eastern-Europe or Asia and you can keep development costs down which is good. But issues with this method are you can miss the mark in the goals of the application by using developers that do not understand the American market. There is a huge upside to outsourcing and that is labor cost savings. Considering the average salary for a programmer in India is roughly $5000 per year, those savings could be massive.

Let us take a Hybrid approach to application development. Why not have a US-based management & design team, dedicated to making sure that the code that is built, is built correctly, whilst utilizing offshore talent by using them as backend development. With this hybrid approach, you get the best of both worlds, cheaper overall development costs & managed quality control of the application design and deployment. This is the overall methodology of the development process here for Esimplicity.

Small application prototype example – 10 screens – 120 hours

Original Approach-US consultant:

120 @ 200/hr = $24,000

Outsourcing:

120 @ 25/hr = $3,000

Our Approach – Hybrid:

120 @ 75/hr avg = $9,000

For the let’s eliminate just outsourcing, as it doesn’t bring us the 100% results we’re looking for with building an application for an American audience / demographic.

That means on a prototype, which is not even a usable version, you could easily save $15k just by using an agency like Esimplicity. This is possible to do by yourself if you do not want the help of an expert project manager. Let us know if you would like to know more about how we control our outsourcing and quality control!

Bureau of Labor Statistics, U.S. Department of Labor, Occupational Outlook Handbook, Computer Programmers, 

 at https://www.bls.gov/ooh/computer-and-information-technology/computer-programmers.htm (visited March 19, 2021).