How Much Does It Cost to Outsource App Development?by Anna Khrupa on December 20, 2019
The app boom continues. According to Gartner, in 2009 consumers downloaded 2.52 billion apps globally. And 2017 this figure reached to 268.69 billion. Statista forecast shows that global mobile app downloads will reach 258.2 bln in 2022. That’s why applications became one of the most effective tools for business to reach a broader audience. And therefore it is not surprising that more and more organizations want to have their own app. But what is the right way to do it? Should they consider outsourcing and think about it outsourcing cost analysis?
What is app software outsourcing cost?
There is no specific cost of app development. Generally speaking, the sum that needs to be spent on an application can start at $5,000 and reach $100,000, $200,000 or even half a million dollars. There are several important factors that can influence the cost of building an app: features and functionality of an app, design and user interface, type of app (native or hybrid app) and platform on which an application is built.
Generally, all apps can be divided into three categories – simple, middle complexity, and complex apps. Simple apps (a good example is a reminder app) have a few functions and are not integrated with any third-party APIs. Creating a simple app takes about 1,000 hours and the price starts at $25,000-$30,000. Middle complexity apps may have real-time chat, custom UI features, advanced search, payment options, integration with third-party APIs and so on. It takes around 1,800 hours to build such an app, and the price of the development starts at $50,000.
The most complex apps have advanced functions such as audio/video processing, synchronization with multiple devices, in-app purchases or in-app ads and many more. It takes 2,400+ hours to build a complex app, and the price starts at $80,000 – $100,000. For example, the cost of development of a photo-sharing app like Instagram or a taxi app like Uber can reach $140,000 – $150,000.
IN-HOUSE APP DEVELOPMENT VS OUTSOURCING
According to Deloitte’s Survey, 72% of enterprises prefer to outsource their IT tasks. Having a house app development team can be both an opportunity and a challenge. Nobody doubts today that an internal team always has a better understanding of the company’s processes. The feedback is received faster and the revision process is more flexible. But there are also disadvantages to this model.
First of all, building a new development team from scratch requires much time, patience and money. If you already have a team you should take care of their salary, working place, hardware, health insurance, training and so on. It is also a fact that the same team in the same place means no new insights are generated.
In other words, companies may not have the resources to support its internal team of developers or simply can’t achieve its goals with it. Luckily, business can outsource many of their software-related tasks, including application development.
App development providers are divided into two categories: onshore developers, who are based in the same country or in the same region and offshore developers, who are located overseas. According to Accelerance, the cost of outsourcing is approximately 50% less than the cost of in-house development, however, the real it outsourcing price depends on the country where the project is performed. Let’s review the rates of app developers in different parts of the world.
APP DEVELOPER SALARY IN THE USA
American IT specialists are known for their productivity and quality of the work performed compared to most of their colleagues on the global market. But outsourcing your IT tasks to the U.S. also means high prices. How much does a developer in the US earn?
Indeed rates the average salary of the US mobile app developer at $107,000 per year, according to Glassdoor it is $92,721 per year, and PayScale states a median app developer salary at $73,24 per year. The compensation depends on the type of project developer is working on and his experience.
According to PayScale data, an entry-level mobile applications developer (0-1 year experience) gets an average compensation of $60,036 per year. A mid-career professional (5-9 years of experience) earns $88,045 and an experienced app developer (10-19 years of experience) can expect to earn $112,293. Late career employees in this field (more than 20 years) have an average salary of $107,990 per year. Forbes says that there are states in the US where developersʼ salaries are higher than the national average, such as Washington, California, and New York. At the same time developers from Kentucky, Oklahoma or Idaho usually earn less.
APP DEVELOPER SALARY IN AUSTRALIA
The rates for app development in Australia are among the highest in the world. An online platform Codemento underlines that Australia as well as the US, are the only countries in which app development can cost more than $100 per hour.
Payscale data says that the average app developer salary in Australia is AU$75,491 (Australian dollar equals 0.68 US dollar), which is lower than on other platforms. According to Indeed, mobile developer salary in Australia is $97,586 per year. And Glassdoor stats say that Australian app developers earn $83,103 per year.
APP DEVELOPER SALARY IN THE WESTERN EUROPE
According to Deloitte, more than 60% of the companies that outsource some of their business tasks choose Europe. It often happens due to good technical and linguistic skills of European specialists. Let’s have a look at how much app developers earn in Germany and France.
Germany, the biggest economy in Europe, is considered to be one of the most important tech hubs in the region. And tech specialists, app developers in particular, can expect to make good money here. Let’s find out whether their expectations can be met.
According to Payscale’s data, the average annual salary of the German mobile app developer is €46,740 a year. Payscale also says that an early career Mobile Applications Developer with 1-4 years of experience can make €47,859. And German developer with 5-9 years of experience can expect a salary of €49,579 a year.
According to the local website Gehaltsvergleich, in Germany, just like in the US, salaries of app developers may differ. It is noted that the compensations of app developers in the south of the country tend to be higher than those in the north. The monthly average salary in the northern part of Germany is approximately €3,743 a month. And if a specialist works in the south of country he can expect a compensation of €4,226 a month.
French app developers are usually paid less than German specialists. PayScale states that an average app developer salary in France is €40,322. According to Indeed, a specialist with up to 5 years of experience earns about €35,700. If an app developer in France have 5 to 10 years of experience he has a chance to make about €45,000 a year. And having 15 years experience under his belt allows the developer to ask for €53,600 a year.
APP DEVELOPER SALARY IN THE EASTERN EUROPE
Outsourcing to Eastern Europe is often a number one choice for companies that are looking for affordable and highly skilled app developers. But how much do they earn?
App development cost, as well as outsource website development cost in Poland, are drastically lower compared to the cost in the US or Western European countries. Polish agency No Fluff Jobs says that the median pay range for the position of app developer is 8,000 and 14,000 PLN ($2070 – $3623). According to another polish platform, an average monthly salary of an app developer in Poland is PLN 7,930. Every second mobile application programmer receives a salary from PLN 6,350 to PLN 9,900. 25% of the worst-paid mobile application programmers earn less than PLN 6,350 per month. A group of 25% of the highest-paid mobile application programmers can count on a salary above PLN 9,900.
One of the important factors that influence mobile app developers salary in Poland is experience and location. Mid-career professional usually make from PLN 8,330 to 14,000 and senior developers can expect compensation from PLN 10,500 to PLN 15,000. The rates in Polish cities such as Warsaw or Wroclaw are usually higher than in Krakow or Poznan.
Ukraine is considered to be one of the top outsourсing destinations for mobile app development projects because of the combination of low development costs and high quality of the provided services.
An average iOS developer salary in Ukraine is $20,754 per year, Payscale stats say. A mid-career iOS Developer can expect to get $24,661 per year. At the same time and the average salary of a Ukrainian android developer is $30,000 per year.
APP DEVELOPER RATE IN ASIA
Asian countries become more and more popular as outsourcing service providers. In many cases, a decision to outsource to Asia save a company a lot of money. But there are risks too – in terms of the quality of provided services, communication and even some legal issues that may occur. But let’s skip the topic of risks and see how much it costs to hire a developer in some of the most popular destinations in Asia such as India and the Philippines.
App development in India is considered to be one of the most economical. The cost of creating an app can be three times cheaper if compared to developed countries. According to Payscale stats, the average app developer salary in India is Rs 507,575 per year (1Rs= $0,014). An entry-level developer (less than 1-year experience) earns Rs 348,507, an early career specialist (1-4 years of experience) gets a salary of Rs 442,49, and mid-career professional ( 5-9 years of experience) earns Rs 878,036. And finally, the average compensation of an app developer in India with more than 10 years of experience is Rs 1,360,898.
Outsourcing to the Philippines today is seen as an easy way to reduce outsourcing software development costs and get access to skilled workers who usually can speak English.
The average compensation of an app developer in this country is PHP 455,537 (1PHP= $0.019), Payscale says. An entry-level specialist (less than 1-year experience) from the Philippines makes an average compensation of PHP 235,832. An early career app developer (1-4 years of experience) can expect to earn PHP 312,431. According to Payscales data, an average salary of mid-career professional (5-9 years of experience) is PHP 930,062 and an experienced developer (with 10-19 years of experience) can expect compensation of PHP 993,222.
How to find the right developers for the app project?
It’s not big news that outsourcing app development can help businesses reduce their costs. But there are many other important factors you should bear in mind while choosing developers for your project. No matter if you are building a simple alarm clock app or an app for a new Lyft you should think about a smooth development process in advance.
When searching for the right developers for your project it is more than appropriate to ask about the qualifications of the team members. You should look for relevant experience. With developers that created apps similar to yours in the past you have much more chances to get a really great product. Don’t be afraid to ask a question about technological expertise and avoid the companies that do not work with the latest emerging technologies. When considering how to choose the right app development team, make sure that a company has defined and documented processes. And don’t forget about the importance of clear communication. It will allow you to avoid any confusions and get your app in time.
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