Expense Breakdown: How Much Does it Cost to Create a Mobile App?

Despite being in demand, mobile apps are still mostly a mystery to consumers. While everyone understands what a mobile app is, many people don't know what goes into making one.

Oftentimes, the lack of knowledge in this area negatively affects both sides of app development. It can be challenging for customers to choose a development company because they are not clear about the time and the effort required to create an app. For app developers like us, it's challenging to explain why it is impossible to create a 30-screen Frankenstein-app that would work on all platforms and devices in a week.

That is why we'd like to dot the I's and cross the t's by detailing the factors that affect app development costs. In this article, we estimated the price of mobile app development based on circumstances like region, company type, the number of platforms, and more in order to provide you with a crystal-clear picture of how much app development costs.

In-house, Outsourcing, or Freelance: Choosing an Approach

When you decide you want to build a mobile app, you need to pick "the right people." The ultimate success of your project depends on this very step, so it's crucial to make an informed decision that will prove effective.

There are three options for development: in-house development, outsourcing (local or foreign), and freelance. Since you are looking into how much creating an app costs, it is unlikely that you'd be considering in-house development, so we won't be covering this option in-depth in this article. Instead, let's have a closer look at the outsourcing and freelance options.

To meet your business needs, you need a team with expertise in app development and an understanding of your field. When your niche is rather narrow, it may be very complicated to find a local company that would meet your requirements and expectations. In this case, the best option for you is outsourcing.

When you choose to outsource, you have more access to reasonable prices. Also, outsourcing provides you with an almost endless talent pool, and due to high competition, most outsourcing companies offer you their best deals.

Sounds nice, doesn't it? What's the catch? Luckily, apart from being physically distant from your team, there isn't one.

Today, there are plenty of tools for video conferences and live chats, which compensate greatly for the lack of in-person communication. As long as everyone is equally involved and interested in product creation, the physical distance doesn't pose a problem. Even time differences aren't the barrier when you all have the same goal.

Alternatively, you may say, "I can save a lot of money and hire a freelancer who will build me a top-notch app." To some extent, you are right; you will save money. However, are you positive that you will be getting a top-quality product?

Usually, when you decide to work with a company, they provide you with heaps of legal papers that you need to sign before getting the ball rolling. While this process can be overwhelming, these legal agreements cover your back in terms of deadlines, quality issues, and responsibilities. Not many freelancers can provide you with the same security.

Yet, we are not trying to convince you that freelancers are the wrong choice. Most freelancers honor their names and rating, and they would do everything possible to uphold their reputation. What we are trying to clarify is that a freelancer and an outsourcing company vary in their level of responsibility. When you hire a freelancer, they are responsible for completing the specific tasks that you pay them for, but the freelancer isn't liable for the overall project.

When you work with a freelancer, you usually pick one person with a specific technology stack. However, many clients don't take extra services/platforms/integrations into account. If you want the freelancing route, you will need to hire someone brand-new for each of these facets. At this point, the direct communication and control that you once considered to be an advantage of working with a freelancer may turn into a nightmare.

With freelancers, you can assign tasks and instantly collaborate day and night, as freelance working hours are often flexible. Alternatively, professional app development provides you with a multi-functional team and a Project Manager who takes care of your app while you are busy with strategic planning.

So, how much does it cost to make an app for each development option? In all honesty, when it comes to outsourcing, you are unlikely to find a reliable company that charges less than $25 per hour. Don't be surprised if you come across a rate of $250 per hour either. With outsourcing, the price per hour doesn't only comprise app development; it also includes office expenses, salaries, rental costs, etc.

If your project aims to make a difference and provide an added value to the core product, it’s better to deal with outsourcing, which guarantees a team with sufficient skills and a high-quality application as a result.

With freelancing, the freelancer's rate is a sum of money that goes directly to a said freelancer without any deductions, and prices may vary greatly. For example, you can find freelancers that charge $25 per hour like a company, and others are willing to make an app for a few bucks. It's up to you which way to go; just remember the benefits and drawbacks of each option.

Location Matters

Currently, the mobile ecosystem is thriving across the globe, which constitutes a spectrum of hourly rates. It's not a secret that developed countries such as the United States, Canada, Australia, Singapore, and Western Europe countries dominate the field. Developers in these countries usually ask for $70-200 per hour.

The USA and Australia are the only countries where mobile app development costs more than $100 per hour. If you have a shoestring budget, it's better to choose another location. For instance, there are countries like India and Indonesia that charge as little as $10 per hour, but keep in mind that you will probably face communication barriers and misunderstandings due to cultural differences.

There are also "in-between" options like South America, where rates start around $45 per hour on average. Although, South America is mainly web-based because 4G Internet connection arrived in this region later than in Europe or the USA. You want to make sure you consider this caveat when arranging for a South American company to develop your mobile app.

Alternatively, if you are searching for an ideal price/quality ratio, consider Eastern Europe. Here, mobile app development prices aren't as high, and the number of specialists is rather impressive. In Poland, for example, developers usually charge $35-50 per hour on average.

Moreover, there is a slight difference between iOS and Android developers’ rates. However, recent research shows that these price differences aren't significant.

Mostly, the distinctions are due to the platforms’ differences. For example, in comparison to iOS, Android has more devices, and developers may take longer to test the apps. In some regions, certain platform developers have higher rates, which leads to great competitiveness. India is a good example, as Android is more popular there.

Now that you are aware of app development prices based on a company's location, we'd like to warn you that you should never choose a company based on the price only. Cost is merely one piece of this decision-making puzzle. You should pay attention to the developer's entire experience, overall development time, and company ratings.

Team Size

The cost of building an app also correlates with the number of people working on your development team. The more people are involved in the process, the more money you spend.

Let's briefly investigate the roles involved in the app development process and look at the value they can add to your project. Please note that the rates illustrated below are the average rates for Belarus based on our experience.

Business Analyst ($40-50 per hour)

If all you have at this point is just an intention, you need a Business Analyst. They help you formulate documentation that converts your ideas into technical requirements, advise which functions would be profitable for your app, analyze how your app compares to its competitors, and detail future development costs.

UX/UI Designer ($35-60 per hour)

When the documentation is ready, the UX/UI designer comes into play. They visualize and animate everything written in your papers. First, they make a wireframe and later transform it into a clickable prototype. If you want your app to look appealing (and you do), you have to fill this position on your team.

Project Manager ($40-50 per hour)

A Project Manager is responsible for coordinating the entire team's work and the overall success of your project. They are the main person that you will be communicating with during the development of your mobile app. The Project Manager steps in after the documentation and design are complete and once the coding begins.

Developers ($40-70 per hour)

There are several types of developers, including mobile app developers (iOS, Android, cross-platform), backend developers, and front-end web developers. The individuals you hire will depend on your needs. Developers' primary charge is to translate documentation into code. A developer's rate will depend on their skill sets and work experience.

Quality Assurance Engineers ($25-50 per hour)

Quality Assurance Engineers test documentation, design, and everything connected to your app. They perform all possible tests to make sure the project components meet the requirements. You will not receive a final result until a Quality Assurance Engineer has carefully checked and approved your app. Similar to Developers, a Quality Assurance Engineer's rate will depend on their work experience.

Platforms

Now, you have the information that you need to decide on what roles you want to fill for your development team. Still, this is just the beginning.

Have you determined the platform you want your future app to be on? Do you need an iOS app? Or maybe your target audience lives in India, where 90% of the population uses Android?

Or someone told you that the most inexpensive way to enter the mobile market is to develop a cross-platform app, and you are considering this option now? Too many questions?

Let's start from the beginning and talk through circumstances that can influence your decision. First, you need to know who your users are. This involves their age, geography, income, preferences, and behavioral models.

For instance, to date, devices that support Android OS take almost 80% of the mobile market. This means that Android users are the majority of the whole population. Geographically, Android predominates in post-Soviet countries, Eastern Europe, some Western European countries, South America, and most Asian countries.

On the opposite, only 15% of the mobile market goes to iOS with its users from the USA, Canada, Australia, Japan, Great Britain, and Scandinavian countries. Commonly, Android users have a lower income as Android smartphones are cheaper than iPhones, which leads to a lower purchasing power of Android users in comparison to iOS users. This variation is why you will find more paid apps and apps with in-app purchases in Apple's App Store and free apps with ad support in Google's Play Market.

Once you understand your users' needs, it's time to compare them with your budget. If you have ambitious plans to have maximum market coverage, you need to develop apps for both platforms.

However, if your funds and time are limited, you might want to consider going for cross-platform development. This kind of development allows you to have an app on both operating systems as well as save time, costs, and efforts thanks to reusable code.

Seems like a perfect plan? Hold on. This approach has some severe drawbacks you should know about before making your decision.

Frequently, cross-platform development is the right choice for small unscalable projects with simple functionality. If this is your project's description, go for it. In all other cases, there are more things to consider.

For example, developers might not have a library necessary for the desired feature, which will lead to creating it from scratch for each platform. If this occurs, you will spend twice as much time on development, testing, and bug fixing.

Now, imagine hundreds of these roadblocks. The more features you'd like to add, the clumsier your app will be. The support of such a project will be a difficulty, and there could be incompatibilities with the next versions of iOS and Android.

Is there an alternative option? The answer is native app development. Native apps are mobile apps designed for a specific platform using original programming languages and instruments of the mobile operating system. The temptation to cover both platforms can be huge, but we'd recommend starting with one.

In terms of costs, there isn't a significant difference between native app development for iOS or Android. Besides, having one application allows you to quickly adjust to your early users' feedback, extend functionality using existing libraries, and save almost half on costs.

Backend Infrastructure and Administration Panel Costs

Unless you are looking to make a calculator, sticker pack, timer, or notes app, your app will require client-server interaction. That means that your application has to work with data, receive it from the user, send it to a server, then return it.

When you use data, your app needs to be able to work with it and store it. Additionally, the more calculations, integrations, and any other synchronizations there are, the more expensive the backend is.

Another feature that usually goes with the mobile app is the administration panel. If you'd like to manage app content, set up user permissions, keep track of the purchases and sign-ups, and send notifications, you will need one.

The cost of developing an admin panel depends significantly on your needs. For example:

• Estimated dev time: User management (List of users, Delete/Edit/Create user) – 60-90 hours
• Estimated dev time: Payments management (List of payments and operations, Refunding) – 20-40 hours
• Estimated dev time: Sending customized push notifications – 8-16 hours

Design Complexity

Creating a customized user interface can affect the cost of the project. The more sophisticated the design is, the more time and effort developers will need to implement it. Conversely, the more OS-supplied elements and standard components are used, the quicker and cheaper your app will be.

The price of the design depends on the number of screens, platforms, and device orientations (portrait and landscape). Let's look at the most common types of apps to make the picture even more precise.

Simple apps

A simple app usually has a few screens, native UI, minimum functionality, portrait orientation, and one platform. Some examples of simple apps are weather forecasts, apps for notes, and reminders. In most cases, you don't need any tutorial on how to use these apps because they are so simplistic that the average user can figure them out.

Estimated design time: up to 60 hours

Design cost: starting at $3,000

Average apps

Average applications hold more complex infrastructure, more screens, a combination of native and customized elements, and two platforms. Proper examples of such applications are messengers, cinema and other bookings, and maps. At first, they seem manageable, but when you look deeper, there are hidden facets, a variety of statuses, and diverse, dynamic data.

Estimated design time: up to 120 hours

Design cost: starting at $7,000

Complex apps

We usually attribute multi-featured apps with customized designs and animations to complex apps and develop these apps for several platforms in both orientations. They are complicated because their functionality can include audio/video processing, real-time synchronization, integration with VR/AR platforms, etc. The more features you'd like to have, the more expensive your app design will be.

Estimated design time: over 140 hours

Design cost: starting at $9,000

Functionality

App creation costs directly depend on the number of features you'd like to include in your app. On the other hand, you should understand that some functions take less development time, and others require additional investigation or need to be built from scratch. Therefore, implementing five simple features can cost less than developing one multi-faceted feature.

Let's have a look at the table below, where you can find the most popular features and see what is required for each feature's development, including the time needed for its implementation and overall costs based on the average rate of $35-40 per hour.

*The approximate time of the development of the presented features doesn’t include Quality Assurance and the Project Manager's hours. These estimates are subject to change by the final design.

Even if your future app has some of the listed features, these figures may not precisely reflect your app’s cost. There are additional costs like architecture, project setup, environment setup, and database configuration that must be taken into account. You will only know the exact cost of building your app after discussing each feature’s aspects with your team.

App Maintenance Costs

The work isn't done when your app is launched. Finally, you need to plan out a budget for app maintenance. You do not intend to start your app and wait until your revenue comes in, do you?

To stand out in an increasingly dog-eat-dog market, you need to improve and scale your product consistently, which means that maintenance is inevitable. Typically, maintenance costs cover the following:

• Support of the latest OS versions
• New features development
• Bug fixing
• Code optimization
• Performance improvement
• Server maintenance
• Cloud hosting
• Third-party service upgrades
• Marketing and promotions

Generally, maintenance expenses are not included in the initial estimation. They are provided as an additional service by your software company.

Tips on How to Save Money on Mobile App Development

Now, let's see how it works with the final price app formation.

Understanding your app's cost structure will help you to discover ways to save money. Below, we share a few tips to boost your budget.

Potential savings: up to 40%

Potential problems: A limited number of small, trustworthy companies.

This solution is a lottery where your chance of winning is too low. 95% of these companies have only just heard of mobile development standards and code style, but they are ready to promise to build you a second Whatsapp or Facebook in three months just because they want a new customer. The remaining 5% of companies are highly desired. If you are lucky enough to find one, you can save up to 40%. There are almost no risks, but finding that one company may be tricky.

Potential savings: 35-50%

Potential problems: See the section about cross-platform development in the article above.

As we have stated, native development permits developers to solve almost any tech issue, whereas a cross-platform solution is a good option for a simple, small-sized project. Initially, cross-platform development may save you 35-50%, but later down the road, your app may change so much that you will have to dump your code and switch to native development.

Potential savings: 20-30%

Potential problems: You must know the drill.

You can split work into four main iterations:

1. Technical documentation
2. Design
3. Development
4. Maintenance

If you come to us with a summary of your idea and some mock-ups, we might give you a rough estimate of $5,000-15,000 in development costs. Nevertheless, if you come with technical documentation, we will show you the exact price for the project; here, we can say with 99% certainty that your app will cost less than $15,000.

How? It's simple. When estimating projects without any documentation, development companies take potential risks into account. The more uncertainty exists in the beginning, the more risks there are down the line.

The price for writing technical documentation ranges between $2,000 and $4,000. When considering general app development costs, this price seems to be a drop in the ocean. Typically, the documentation process takes about 2-4 weeks.

When the documentation is ready, we make the final estimation, start planning sprints, and dedicate a team to your project. The technical papers will save you money on each stage of app development. What's more, in the final stages, your documentation will serve as a guarantor that all your requirements are implemented.

So, what are the risks here? You need to understand what is written in the documentation. That means that you need to have some tech skills. Otherwise, you may not get what you expect.

Potential savings: 20-50%

Potential problems: End up with a simple product.

In apps development, the concept of Minimum Viable Products (MVPs) exists. An MVP is when you design an app with a minimal number of features that would cover your initial objectives.

Later, functionality can be added and scaled, but for the first version, developers will only add the minimum amount of features that your app needs to keep it alive. Using this tip, you can save up to 50% and progress based on your users' early feedback rather than build a useless, multi-featured castle based on your original plan.

For example, if you own a flower shop, your app must have a list of flowers you sell, a shopping cart, and a delivery option. When you only do the necessary, you stop here. Of course, you have a lot more ideas on what to add. But stop! You don't need a social network for flower lovers, Apple Pay integration, or bouquets selection with the help of artificial intelligence just yet.

Your goal is to sell flowers via the mobile app. The rest is expensive, nice-to-have features that you can add at a later time. Remember to notify your users that this is just the first version and that there will be more extended functionality down the line.

Potential savings: 10-15%

Potential problems: Limited time for other ventures outside of your commitment.

Mobile projects are usually short-term, and this drives up costs. The process covers the presale stage, expenses connected to the project's start, project completion, project acceptance, and maintenance, which usually lasts a few months.

To save some money, try and develop a long-term relationship with your developers, plan to work with them on updated versions and new functionality. See if this approach could come with an agreement on a discounted price.