Don’t overpay for software development!

Enterpreneurship, Software development

Everyone wants to win in business negotiations, and software development world is not much different in that matter. As a customer, you expect a high-quality product at a low cost and delivered in short timeline.

You have a full right to expect that, however, if you’ve been even briefly interested in software project management realm, you realize that good software developers earn a lot these days. Moreover, companies need funds to operate and provide a high-quality service, and as a result, their prices soar.

Does this mean that you are at the mercy of a software house and you don’t have a choice but to overpay?

Fortunately not. No single company monopolized the software development market, and you have a wide variety of options. Admittedly, a very low price should rise a red flag and could, in the long run, end up costing you money, frustration and time.

Despite having software development processes in place, right-sized teams, and quality assurance, there are companies who offer attractive pricing on their software development services. In this article, we will go into details of how to not overpay for your development services.

BEGIN WITH AN END IN MIND

Saving money upfront can result in high cost down the road. Depending on your life experience, you probably were in a similar situation where you saved money in the short term, and it resulted in you paying extra later on. You purchased a cheap product, only based on price and you got what you paid for it.

When creating software, working with the wrong vendor can have a catastrophic result to your endeavor success. In the majority of cases, we recommend working with a medium-sized software house, that has Project Managers that work in your time zone and will understand your market needs, your culture and will communicate well.

Be very careful when hiring freelancers. The Internet is full of stories of failed business relationships with freelancers. To be honest, the blame is not always one-sided. “Live Work Anywhere” gathered the most common drawbacks of working with freelancers.

Be cautious when working with a company that is far away from you. In our article “6 Success factors when choosing software company in Canada to implement your Startup idea”, you can read about main reasons why such relationship fails. The main being: lack of understanding of the wants and needs of yours and creating the wrong thing.

You can easily avoid that by narrowing your spectrum of candidates to solid software houses only and move on to the next step which is comparing their offers.

COMPARING OFFERS

Asking for quotes and offers doesn’t cost you anything. Aside from getting pricing information, you will be able to get the first impression and a gut feeling about the companies that you potentially will rely on and take your business to.
Bare in mind that good software houses are not going to just desperately jump in regardless of the impression you make on them. Make sure you come across as someone who would be great to work with. Thanks to that, time invested in creating a proposal will not feel like wasted time.

How to do it best?

Be concrete about your needs and wants.

You should know exactly what you want. Be prepared to explain the what and why of your idea. We hope you find our article on idea validation helpful in initiating conversation with a software house.
The better you can present your idea, the easier for the development team it will be to plan, design and implement the right solution for you. You also will stand a better chance to get the right price for the service. As Randy Lynn says in his response on Quora:

“An agency that’s “hungry” may be more willing to negotiate if your business seems attractive to them or has good potential for long-term growth and profits.”

Also, remember to write clear and reasonably-sized messages and RFPs. Be mindful of your interlocutor’s time and they will do the same in response.

TRUST THE EXPERTS IN CHOOSING THE RIGHT METHODOLOGY

When you decide on the company you want to trust with your project, then just trust them. Otherwise be prepared to overpay. If you need help picking the right company, see “6 Success factors when choosing software company in Canada to implement your Startup idea”.

Why?

Most renowned companies will offer you an hourly rate. The less time they need to spend initiating your project, the lower the bill. If you picked the right company, they will want to deliver the project in the best possible quality and in the shortest amount of time.

It will be possible only if you allow them to do it on their own terms. Hand off the “How” as part of your trust in them.

Paul Graham, a start-up world veteran, and an investor is of the same opinion in his post from back in 2001: “Give the Programmer as Much Control as Possible.”. Pauls is one of the founders for an incubator, as well as Y-Combination – an investment fund that funded over 1000 startups, including Dropbox, Airbnb, Stripe, and Reddit. Such track record is sufficient to trust his advice and let the development team decide on the “how” while you hold on to the “what”.

ENGAGE IN THE PROCESS

The more positively engaged you are in the process, the more smoothly it will go and the cheaper it will be.

At this point, a question might pop up in your head: “Why do I need to spend my time on that if I am already paying for them to deliver the solution?”. You are partially right. Noone expects you to write code, however, your engagement is priceless.

If you decide to work with a developer that leverages Agile methodology, your role boils down to providing feedback, prioritizing and monitoring progress for a sprint or a milestone. In Scrum methodology, you will have your role as a Product Owner in the team and according to the theory, you might be either the weakest link that can paralyze the work and encourage unnecessary costs or the catalyst to success and introduce savings by catching and resolving problems early.

Our advice is to be engaged in the process from the very beginning. Project Manager’s (or Scrum Master’s) role is to make sure you are engaged and an integral part of the project. Check out this blog post on Bright Hub. The project Manager will get you involved in a project by making you ask questions and asking you questions about the project’s requirements, priorities, and proposed solutions. You should feel that you have an open communication channel between yourself and the project team. If you don’t feel like it’s the case, voice your concern, don’t let it stew.

SUMMARY

The secret to paying optimum rates for developing software is captured in the famous saying “Live and let live”.
Pick a company that pays market rates to their employees. Naturally, they won’t be the cheapest or the most expensive company on the market.
From the first contact, care about the communication, be professional, clear and positive. Expect the same in return.
Engage in the process of software development as much as you feel comfortable with, it’ll greatly help the team. Require being able to stick your nose anywhere whenever you want to.
When you co-operate with experts, you are sure that you are paying the right price for implementation of your project.
At least this is how working with us looks like 🙂

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