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What affects the price of an IT project?

For ClientsFor Developers

As in every project, also in the IT market, the price depends largely on its complexity. However, in the case of an IT project, there are much more price factors, like: the chosen technology, long-term relations with the contractor, cooperation approach (‘outsourcing’ per working hour or ‘project approach’) or type of framework. What should you take into account to avoid overpaying the project?

WEIGH SYSTEM COMPLEXITY

Analyze what features your system really needs in order to fulfil your business/start-up/application idea and to be fully functional. It is best to start by listing down the system’s goals, then writing down necessary functionalities per each goal. In the end it is worth to analyze the links between the features, meaning how one feature influences the other. If possible at this stage, think through potential future extensions. This list of features will be afterwards the main factor to make a final decision on the technology type.

Do not throw everything you have in mind into the system as it will surely increase the cost of your system. The more functionalities to implement, the bigger the price. Unnecessary functionalities can also significantly slow down operations in the system, so called ‘number of queries’, which may influence the system’s speed and ipso facto users’ comfort. In this case, additional costs can be generated by purchase of additional servers or hardware or unscheduled repairs due to tougher system maintenance. Aside from the price issues, the excess of functions can also complicate system’s usability.

THINK OVER THE TECHNOLOGY

This is no mystery that there are more and less expensive technologies in the IT market. Most of modern web technologies are efficient to some point. The difference in their price often results from the availability of the developers working in these technologies (the more developers, the bigger the choice and lower the price) or the availability of stocks of pre-made modules/short codes in a given technology (the more pre-made modules available, the lower the price). However, not every technology will work efficiently in every project. The choice of the technology depends largely on the type and complexity of the project. This is why while planning a new web system or application, your first analysis should define all possible technologies which will offer an efficient framework to your project. Then from all given frameworks, you can choose the least expensive one.

Not the other way round though…

CONSIDER FUTURE SUPPORT SERVICES

Some software companies will be willing to reduce the cost of implementation if you sign with them a long term support agreement. Moreover, in this case they can offer you the option of adding some features once the system is launched in its basic version. This means features implemented after completion of the project, covered with monthly maintenance agreement could substitute installments. Thanks to that you will benefit from financial liquidity and predictability.

PROJECT APPROACH VERSUS OUTSOURCING APPROACH

Software houses will most likely offer you one of three approaches to system settlement: “outsourcing approach”, “project approach” or both. In the outsourcing approach, the project is estimated and charged, function by function, in working hours. In this approach the client knows exactly what he pays for. If implementation of a feature takes less time than estimated, the client pays less. However, in case of iterations or repairs, all other works are charged additionally per working hour.

In the ‘project approach’ the price of the whole system/app is evaluated at the beginning of the cooperation. Regardless the number of corrections, the contractor should offer them at no charge, as part of the warranty.

The price of the system/app in the ‘project approach’ is usually higher than in the ‘outsourcing approach’ (the guarantee is one of the reasons). The outsourcing approach usually gives the client more flexibility, in this approach you can in fact change your contractor at any stage of the project (as you pay for every working hour, the code is your property at all times). In the outsourcing approach the price of the project is ‘spread over time’ which happens to be important, especially in case of start-ups with lower budgets.

AVOID VENDOR’S OWNED PLATFORM

Even if at the beginning of you cooperation a contractor working on its author’s framework offers a very competitive price, you should avoid this kind of investments. If you choose a system implemented based upon vendor’s owned framework, you will be tied to this software house and its platform for years. It is rare that another software company will be willing to work on others unpopular framework. Software companies offering their author’s solutions are aware of this problem and they use it as bargaining chip while setting their hourly rates for future customizations, further development or technical assistance. Therefore, widely used frameworks, like for example Symfony, .NET, WordPress, PHP, etc., are considered to be safer solution, especially in the long-term. Choosing such a technology, you can always change the software company managing your site, without the need of rewriting the software from one framework to another.

TO SUM UP

Just a small reminder, before you begin negotiations remember to always rethink the scope and features you need. Too many functionalities, which in later use may prove unnecessary, will significantly increase the cost of the project. Pay attention to the technology choice. Last but not least, do not forget to evaluate you budget… The decision to set the total value of the project in advance or to pay per working hour may in case of smaller budgets become a game changer.

If you need further assistance in estimating your project, do not hesitate to contact us, at createIT.pl

About the article Author:

Hi, we are createIT!

As a passionate group of professionals with a love for Web and mobile technologies, we have been successfully serving our clients for the past 15 years. Through these years we have continuously striven to create the best IT solutions our clients seek.

Our 50+ developer team creates cutting-edge complex B2B and B2C web systems and apps as well as delivers top-notch direct outsourcing services.

We work in multiple frameworks but we hold special feelings and are experts in  Symfony, WordPress, React, PhoneGap, and Blockchain.

We are located in Warsaw, Poland, in the heart of Europe. Concentrated on delivering durable web solutions of high integrity, we do not always try to be the cheapest. However, thanks to our location you will be surprised how reasonable our prices are.

Fluent in English we offer services worldwide. Among others, in countries such as the U.S.A., Great Britain, Germany, Australia, Sweden and Poland.

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