How Much Custom Software Development Costs in 2025?

How much does software development cost? Among startups, SMBs, and enterprise-level companies, this is one of the most frequently asked questions. So, to understand how much it costs to develop software, we have to go through the concept from the beginning, so let’s discuss some points such as:

• What is software development? 
• How much does it cost to develop software for your business?
• What are the things affecting the cost of development?
• And more! 

The cost to develop software for your business can vary according to the different criteria of your project. Thus, an average cost can start at $20,000, you can easily consult a good software development company who can help you provide the estimation as well as help you in the software development as per your vision. 

Now, without wasting a single minute, to know detailed information about what the cost can be,  let’s delve into this comprehensive blog. 

Market Stats Related to Software Development Cost 

The software market is expected to experience a great rise. 

The software market revenue is projected to reach US$896.17 Bn by the year 2029.  

Furthermore, the revenue in the Software Market is projected to exhibit a steady annual growth rate of 4.87% from 2025 to 2029. 

As per Gartner’s survey, around 25.56% of respondents experienced accelerated growth post-software purchase, while 58.56% of respondents voted for standard growth.

What is Software Development? 

Software development is the process of designing, testing, creating, and maintaining different software applications. It comprises multiple steps that involve professionals from various fields, not just software developers but individuals such as testers, designers, and more. Multiple software development firms work have a team of experts who are well-versed to provide you with the best result. They also provide businesses with different custom software development services so that you do not need to go through much hassle to find another company for each task.  

Software development is basically the whole process from the ideation of the project to deployment and submitting the project to the client. So hope now you are aware what exactly software development means. 

In the next sections, we have covered different factors that affect the cost of software development. 

Software Development Costs by Different Types

Software development has multiple different types. In this section, let’s examine each one and how costs can differ. 

Custom Software Development 

So, the software development required by businesses can be of two types: first, custom software development services, and second, they can provide a referral of the already existing software. Mostly, the client prefers to go for custom development as they want to get everything as per their requirement for the project. For the development of the software, one of the most important things that is required is finding one of the custom software development companies that can ensure the development as per the requirements. 

Custom software development can cost more than normal software development, as the developers have to work on each element separately this as per the requirements of the client. It can cost around $50,000- $200,000 and can also go higher as the requirements increase. 

A typical custom software development agency consists of multiple roles to work on a project that can be: 

• Business Analysts 
• UI/UX designers 
• Expert Developers 
• Project Managers 
• Quality Assurance and Testing team 

If you’re unsure whether to choose custom or traditional software development, consult a reliable software development company they will help you assess your needs and offer valuable insights.

From Scratch vs. Modification 

Software development can be of two types: it can be from scratch when the business does not have its own software before and wants to work on it now, as the technological growth in the market is encouraging them to do so to compete with their competitors. 

The second category is the business that already has product software available in the market but is not doing well, so it has to include the latest technologies and trends in it. These types of modifications can also cost you differently, as on the requirements you are including in the modification. 

The businesses can go for a scratch project development from market research to deployment or can also go for the modification of the existing software. It totally depends on the needs of the business and client. But before that, the businesses should look for a good custom software development agency that can support them to get the right product as per their imagination. 

Mostly, many businesses go for the MVP software development at first if they are not ready to build the full-fledged software at once. Second, and an important thing in this is the cost factor when someone is restricted to their budget, then they should go with the MVP development. The cost might start from $50,000 and then increase as per demand.

On the other hand, the cost of modifying the software totally depends on the features and functionality they want to integrate.  

Software Development Costs by Business Size 

Every business requires software to grow in a competitive market and stay ahead of the trends. Thus, we are going to discuss the cost of developing software according to different business sizes. 

Startups Software Development

Startups are small companies that are just starting their journey in the market, so they do not have limited budgets. They also focus on the unique projects that they can offer in the market to make a presence. 

So, startups go for MVP development for the project so that they can put all the necessary details in the software, covering the pain point they are focusing on the target audience. 

After the startup launches, you can eventually upgrade the software with more features as needed. If you find the process confusing, consult a reliable custom software development services firm to guide you from the beginning of the project.

Also Read: 55+ Software Development Ideas to Consider

SMBs (Small to Medium Sized) 

According to the Forbes market research, there are approximately 33.3 million small businesses in the US itself. Yes, that is a huge number, and with this, all the businesses are looking to enter into the latest trends, so why not SMBs? They are also dedicated and focused on working on the automation of their business processes, data management, in-build communication, and integrating multiple features in their companies. That leads to the requirement for software that can handle everything in the same place. 

An estimated cost for developing such software that can manage the growth process of businesses can be from $70,000 to $100,000. It is important to note that these are the approximate figures and are not confirmed. As per the research, an average overview of the price is provided here. It can go higher or can also lower as per the need of the project. 

Enterprise Level Software Development

Coming towards the well-settled companies present in the market. They are already well-known brands and have a lot of work to do internally and externally. For example, we can talk about any healthcare firm whose chain is present all over the globe. Already, they might have a number of audiences using healthcare software development, or if they are using any software for managing the work within the organization, then they are required to update that, which is the scenario here.  

Inclusion of features or upgrading of this organization’s software can cost them around $90,000 to $200,000. Due to multiple reasons, security and data management are huge in their cases, and multiple other things need to be kept in mind while working on their project.

If you are still not sure about the cost, you can consult a good custom software development firm, which can provide you with a full quote for the software development by the size of your business.

Checkout more: Healthcare Software Development services

Factors Affecting the Software Development Costs

So, in the previous section, we have mentioned software development costs according to the different types of business sizes. Now, moving forward, we will cover the multiple factors that are affecting the cost of software development. 

Software Type and Complexity

The factors that most affect the software development cost are the type and complexity. The given table provides a descriptive view. This average cost depends on the complexity of the project and the more time taken, and the cost will also increase accordingly. Often custom software development companies provide these details in the start but if they are are not then you can ask for this.

Complexity	Average Cost	Time Taken
Basic	$10,000- $40,000	45-60 day
Mid- Level	$40,000-$100,000	4-6 months
Advanced	$100,00-$200,000	6 months to a year

UI/UX of Project 

The UI/UX  of the software is a very important part of the development process. 50% of the budget is covered in the project’s design. There are multiple steps in this process, such as working on making the wireframe of the project and then implementing it in the actual project. Make sure to make the most interactive user interface and easy to use so that everyone can get access very easily. If you want your design to be on point, then you should hire a proficient custom software development company who have a team of experts well-versed with the latest design trends. 

Technology Used 

Multiple technologies are used in single software development. Apart from this, multiple platforms and other things also come under this process. Let’s look at the table for further knowledge.  The technologies can differ depending on the requirement, and second, they can also differ according to diverse custom software development firm. The technologies can differ depending on the requirement. Now, talking about the software development cost, the cost differs according to the experience of the developers and the complexity of the language. Other than this, the cost can be present in some integrations and platforms that can be conveyed by the company prior to or informed at the time the client wants something extra from the project requirement. All this can be discussed when you avail the software consulting services.

Category	Technology
Programming Languages	Java, Python, JavaScript, C#, C++, Ruby, Swift, Kotlin
Version Control	Git, SVN, Mercurial
Integrated Development Environments (IDEs)	Visual Studio Code, IntelliJ IDEA, Eclipse, Xcode
Web Development	HTML, CSS, JavaScript, React.js, Angular, Vue.js
Backend Frameworks	Node.js, Django, Flask, Spring Boot, Express.js
Database	MySQL, PostgreSQL, MongoDB, SQLite, Oracle
Cloud Platforms	Amazon Web Services (AWS), Microsoft Azure, Google Cloud Platform (GCP)
DevOps	Docker, Kubernetes, Jenkins, Travis CI
Testing Frameworks	JUnit, Selenium, Pytest, Jasmine
Mobile Development	Android (Java/Kotlin), iOS (Swift/Objective-C), React Native, Flutter
API Development	REST, GraphQL, SOAP

Geographical Location of the Development Team 

The location of the software development companies is also an important factor to consider when estimating the cost. The location of the software development company is also an important factor to consider when estimating the cost. The custom software development cost can also vary according to the team location. For example, a developer from the USA is much more expensive than the one residing in India. Here is the table distinguishing the average cost of hiring software development team from different geographical regions.  

Region	Cost of Hiring
USA	$90-$100/ hr
UK	$80-$85/ hr
Europe	$79-$80/ hr
Australia	$60-$70 / hr
India	$40-$50/ hr

Hidden Cost Involved in the Software Development 

Apart from these costs, there are multiple hidden costs that are available in the software development process. We have listed down below for reference so that you do not get a shock if it is your first time in development.    

Software Maintenance Cost

The work does not end after the software is developed. It needs to be maintained in a time to time along with the update to improve its functioning and avoid errors. 

Software testing services and maintenance is a must-have process that most businesses carry out. The cost of software maintenance should be 2x the development cost. 

The maintenance should be done very carefully, taking care of everything at the time and should be done properly, thus requiring an adequate amount of money. Hence the businesses should make sure of these things in advance. And also can provide software consulting services, which can provide the top results. 

Software Marketing Cost

Marketing plays an important role at the time of the development of the software and after the project completion as well to reach most of the audience the businesses are focusing on. This can be a cost that one should keep in mind when starting the project. They should decide the work accordingly and make sure that the marketing costs are put apart from the development costs at the start. Multiple custom software development services also focus on providing a proper marketing team to businesses for a better approach. 

If your software development costs $100,000, then the marketing budget should range between $200,000 and $300,000. 

Cost of Add On Tools

When you want to develop software that can perform everything for the business benefit and should contain every feature possible. It can become complex for the development phase as well as the time of the development will also increase turning into multiple years. So better, you can leverage external services where you can get the functionality you need in less time. These are some of them that can be included. 

• Chatbot 
• E-mails
• Image Recognition
• Voice to Text
• APIs
• and many others, 

If you go for a custom software development company, they can provide you with a different experience. As the team will work from the initial, taking notes of each step from you. This can be a little costly than going for the pre-existing software development, but can help you outshine in the competitive market.  

Read More- LIMS Software Development (Lab Information Management Software Development)

Why Hire Octal IT Solution to Optimize Software Development Costs? 

So, are you deciding to develop custom software for your new or existing business? If so, you can choose Octal IT Solution as your software development company. 

Why? Well, you can make software with expert assistance. At Octal, we have a team of skilled developers who are well-versed with the latest technology and trends. With these years of experience, we ensure you work on every detail perfectly, also meeting cost-effective results to match the demand for every business requirement. From the past few experiences, the average software development cost can start at $20,000 to more as per the requirement. 

Key Highlights

• Awarded by Clutch, GoodFirms, Business of Apps etc.
• Round-the-clock Assistance 
• Smooth Communication 
• Ongoing Maintenance and Support 
• Data Privacy and Security, etc.  

Still, have some queries, schedule a call today and get free assistance for every detail. 

Key Takeaways 

The software development costs can vary significantly depending on various factors such as functionality, complexity, tech stack, expertise of the developers and location of the team. Thus if you are also looking for a cost- effective development you can always go for the top software development company.

Checkout more services: CRM Software Development Company

Frequently Asked Questions