20 Ways to Reduce Business App Development Costs (in 2023)
Struggling with increasing application development costs? Inflation, developer talent shortages, and increasing demands have made building applications within budget nearly impossible.
Left unchecked, expensive applications can burn through resources and cause cash flow problems. Worse, you can create a rushed app that falls short, damaging your brand.
With rising costs, you need simple solutions you can implement today to reduce application development costs.
We dive into 20 strategies you can use right now to drastically reduce the cost of application development.
How Much Does It Cost to Build a Business App?
Pricing application development is tricky. There are numerous factors that can influence the cost of creating a custom application.
The more complex an app is, the more expensive it’ll cost to create.
Here are some low-end estimates:
|Full-Time Software Developer||$105,000+|
Source: Business of Apps
These are ballpark figures. The more features, integrations, and platforms, the more hours it’ll take to develop the app and the greater the cost.
Other factors can influence application development costs: shifting scope, developer churn, updates, and bug fixes.
If you’re not careful, your application development costs can spiral out of control.
Best case, your new app costs go beyond the scope. Worst case, you’re forced to stop the project before completion due to cash flow concerns.
And the last thing you want is to be left with an expensive, unfinished application.
20 Ways to Lower App Development Costs
While application development is an investment, it doesn’t have to bankrupt your business.
Follow these steps to reduce your application development costs.
1. Do Your Research
The most effective way to reduce application development costs is to conduct thorough research before starting any new app build.
Here’s the best approach:
- Start by defining the business problem. This can be something customers or your team mention frequently. The problem should negatively impact business performance.
- Research your audience. Ask intended users (customers or employees) where the current process falls short. Look for steps that feel like busywork or require entering the same data multiple times.
- Map out the existing problem. Determine the true origin of the problem. Often, customer and employee frustrations are symptoms of deep-rooted problems. You do not want to waste time and resources treating symptoms.
- Analyze competitors to see if they provide similar features. It helps to know if you’re filling a gap left by competitors or catching up to them.
- Determine security requirements: Understanding data handling and security is necessary to avoid costly mistakes. The solution might need specific security requirements, for example, limiting access to add/edit/delete/view for some users.
- Search for existing solutions. Sometimes you can cut costs by finding turnkey solutions that are better and more cost-effective than custom builds.
- Establish KPIs. Determine what success looks like for this solution. This can be in cost savings, customer satisfaction, employee productivity, or any other KPI aligned with current business goals.
- Collect baseline data. This will help you evaluate the app's success, calculate ROI, and inspire future app development.
The more detailed you are in your research, the more likely you are to stay within budget.
2. Provide Detailed Project Requirements
Clearly communicating project requirements prevents costly scope creep that can drag out your application development and drastically increase costs.
Start by compiling your research into a Product Requirements Document (PRD). This document clearly defines the capabilities of the application, providing clear scope for the project.
The PRD typically specifies:
- Project overview
- Reason for the development
- System/platform requirements
- Assumptions, Constraints, and Dependencies
- Finalized list of features for the application
- UI/UX requirements
- Timelines for development
- Estimates for development at each stage
Remember, unclear project requirements frustrate software engineers, create confusion, slow down development, and increase costs.
Clearly state what you need from the start with a well-defined PRD.
3. Decide Between an MVP or MVR
You need to choose between developing a minimal viable product (MVP) or a minimal viable replacement (MVR).
An MVP is the most simplistic version of an app with only the essential features for your target audience.
An MVR is the most simplistic replacement for an existing solution that reduces issues with change adoption found by replacing complex legacy systems.
The goal of both is to launch a solution quickly with minimal resources to determine if the target audience finds value.
Choosing the wrong type will waste resources and damage customer relationships.
Which one should you choose?
The MVP is for testing new products. The MVR is for testing out new features or upgrades to existing products.
From there, businesses can invest more resources to fully build out the solution. Or, they can scrap it and focus on other improvements.
4. Establish Clear Communication
Miscommunication leads to errors and slowdowns, drastically increasing the cost of building your app. Reworking an app to better align it to the intended design is expensive.
To avoid this, set up clear channels of communication from the start.
Communication between developers and the team should be consistent and clear. This ensures the applications meet the desired outcomes. Collaboration, problem-solving, and decision-making increase as well, leading to a streamlined development process.
Effective communication, feedback, changes, and updates to stakeholders reduce delays. At the same time, your team can easily track the progress and costs of the project.
5. Keep UX/UI Simple
Complex designs can confuse users and inflate costs. Simplicity is key when it comes to cost-effective app design. Minimalistic designs often work best.
You want a clean, refined user interface (UI) that helps users access your app easily.
Prioritize accessibility, standard features, reusable modules, and elegance over unnecessary customization. Your app can stand out without being too new that it’s confusing.
Complex designs make user adoption hard, which can negatively affect the overall impact of the business solution.
6. Use Low Code Tools
Low code applications allow users to rapidly build applications using drag-and-drop, visual interfaces. Rather than code from scratch, you can use prefabricated snippets of code.
As a SaaS platform, costs scale with use. This makes them an affordable option for businesses. Plus, they rely on cloud-based infrastructure to keep them accessible and secure.
With low code tools, your developers can scale application development without excessive costs. You can even train non-developers to build applications. These "citizen developers" work as extensions of your IT team, building solutions.
With rising costs and developer shortages, low-code tools help businesses achieve digital transformations successfully.
And now that low-code platforms are incorporating AI to help streamline development further, it's likely that these tools will continue to lower app development costs.
7. Provide Thorough QA
Testing an application is a complex process. Finding and eliminating bugs efficiently is key to keeping application development costs low.
You do not want to rush Quality Assurance (QA).
User satisfaction is critical. Bugs ruin the user experience, damage the brand, and drive up costs. In fact, 48% of users are less likely to use later versions of an application after finding bugs in it.
It gets worse.
Did you know that 44% of users delete an app immediately if it doesn't work? And 34% will immediately go to a competitor…
QA also helps you identify and address usability issues, performance bottlenecks, compliance concerns, and compatibility problems early on, reducing costs.
Start early and test iteratively.
8. Run User Acceptance Testing (UAT)
User acceptance testing is a process where end users test the applications to ensure it meets their expectations.
UAT uses product requirements aligned to a methodology (Waterfall, Agile, etc.).
Start by recruiting members from your target audience, developers, and team members and provide them with the tools to test the project. From there, you should train your UAT team and provide resources for them to test the application. As they test the app, they should collect information and analyze the results.
Once complete, your developers should update the application and relaunch it. You can retest as necessary.
UAT focuses on validating the app's functionality, usability, and overall user experience. It helps you catch potential issues early and address them before releasing the application.
9. Reduce Scope Creep
Scope creep occurs when the project scope extends beyond the original plan due to additional requirements or functionally requested by the customer or business user.
This increases the level of work, pressure on internal teams, and the chances of missed deadlines. All of which drive up the costs of a project.
To reduce scope creep, you need to have a clearly defined project plan in place. Any changes to the project plan should be documented as a formal change order request.
It also helps to break large projects down into smaller, more manageable phases with frequent evaluation. Your team should communicate often, providing feedback to ensure the project aligns with goals at each stage.
To keep app development costs low, only approve change order requests that align to critical app functionality. Your team can include other non-vital updates in later sprints.
10. Listen to Your Team and Customers
One of the most expensive mistakes you can make in application development is to build an app that your customer or your team doesn't need.
Throughout the application development process, you should collect feedback from your team and customers. This will ensure that the app you build aligns with their needs.
Without customer feedback, you may find yourself tangled up in costly redesigns or product overhauls that increase app development costs exponentially.
11. Remove Unnecessary Features
Unnecessary features are an expensive distraction.
They make development more complex, more time-consuming, and as a result, more expensive. Their increased complexity also induces more risk in the development process.
Additionally, unnecessary features also have high maintenance and support costs. Each new app feature requires updates, increasing the costs over time.
Plus, they increase the risk of expensive errors and drain app resources, all of which can negatively impact the user experience.
And too many features can clutter the interface, reducing app functionality and confusing or frustrating the users.
Instead, you should focus on core features that align with business goals. Remove unnecessary features. And revisit them later on when it makes more financial sense.
12. Consider Offline Capabilities
Applications need to function in the best environment for the user. While most users have access to the internet, that's not always the case.
For example, construction companies often work on job sites with minimal/no access to the internet. This forces them to rely on manual processes rather than digital solutions to carry out tasks. As a result, construction companies are notoriously inefficient.
Applications with offline automation can sidestep this problem by carrying out functionalities without access to the internet. This improves efficiency and adoption.
In short, you need to be certain your team and customers can use your application no matter where they are. For some businesses, that means ensuring apps function offline.
13. Promote Faster App Development
The faster your team can build applications, the less time they'll spend on coding, testing, and debugging. Even better, your solutions (and the results) will go live faster.
This goes deeper than adopting Agile application development methodologies.
Your organization needs to adopt a mindset around faster application development. That means reducing organizational obstacles (such as bureaucracy, bottlenecks, and inefficient processes) that slow application development down.
As mentioned before, embracing low-code tools is another easy way to promote faster application development in your business.
14. Don't Reinvent the Wheel
Template libraries, existing platforms, and open-source software can speed up development.
Numerous third-party template libraries are available to streamline your app development. Rather than design templates from scratch, you can customize existing ones. This lets you skip the initial design phase and focus more on features and functionality.
You can use existing platforms to provide a framework for building applications that have pre-built functionalities and integrations built in. For example, these platforms come with features like user authentication, social media sharing, push notifications, database management, and cloud storage. As a result, you don't need to build them from scratch.
Open-source software is free to use and maintained by a community. There you'll find prebuilt libraries, frameworks, and tools that can speed up development. Plus, these vibrant communities offer strong support, with members actively adding code and documentation.
Your team can use these resources to speed up application development (and cut costs) by using what already exists.
15. Automate Repetitive Tasks
In 50% of jobs, at least 33% of the work could be automated. The more time your developers waste on menial tasks, the longer it takes them to build your applications.
This drives up the cost of application development.
You can reduce costs by automating tasks for developers. For example, they can automate email updates, app testing, milestone notifications, data collation, reporting, and more.
Developers can also use AI tools like ChatGPT and GitHub's CoPilot to automate aspects of application development, like code generation.
16. Evaluate Updating and Maintenance Costs
App development costs are never "one-and-done".
The hidden cost of app development is in updating and maintenance costs. Their costs vary depending on the complexity of the app and the extent of the updates.
The more complex the app, the more time and resources need to go into updating it.
You need to understand the cost of maintenance before committing to the development project. This will help you budget accordingly and avoid unpleasant surprises.
17. Choose Native, Hybrid, or Cross-Platform
There are costs and savings involved with each:
- Native apps are more powerful, provide better UX, and can function offline. However, they are typically more expensive and time-consuming to build.
- Hybrid apps are faster and more affordable to build. However, they require internet access to function and may not provide the best user experience.
- Cross-Platform are increasingly popular as they render properly across all devices. But, they struggle to keep up with the functionality of native or hybrid apps.
Hybrid apps and cross-platform apps tend to be less expensive. And while cross-platform apps are more popular, they both require APIs and internet connections to run.
This makes them potentially less secure.
Which one is the most affordable?
There are pros and cons for both. You need to evaluate both against your business goals to find the most cost-effective approach.
18. Outsource Application Development
Depending on your needs, it may be faster and more affordable to outsource application development.
It's the 80/20 principle.
You see the most results when you focus on the 20% of your business that drive 80% of the value. For most businesses, that is not application development.
If that's the case, trying to manage application development becomes an unnecessarily complex (and expensive) process for businesses.
Even if you have an internal development team, they may not have the experience building the applications your business needs. They could waste more time and resources creating an app that underperforms when compared to what an outsourced development team could create.
At the same time, you could end up spending far more by outsourcing application development to an inexperienced partner.
For example, working with offshore developers tends to be the most cost-effective approach. But cultural differences, communication gaps, poor leadership, and high turnover can result in more expensive application development projects.
Be careful when outsourcing.
You don't want a vendor. You want a strategic partner who can build the custom solutions you need while finding other opportunities for you to succeed.
They should understand your niche, customers, the latest technology, and the current market trends. That way, they can create solutions aligned with your business goals.
Also, it's important to note that your work won't stop once you outsource application development. You'll need to collaborate with your partner to create the best application.
19. Limit Work in Progress (WIP)
In an ideal world, developers would work on one project at a time. They would be laser-focused. And each task would get their complete attention until it was complete.
Unfortunately, that's far from the reality.
Developers often juggle numerous competing priorities. Moving between tasks, also known as context-switching, kills productivity.
Instead, you should:
- Give your developers time to focus on the main project.
- Build processes for communication and managing tasks effectively.
- Reduce the number of projects your developers manage.
Developers will always have pressing tasks. But to reduce development hours (and costs), you need to limit the number of projects your team manages simultaneously.
20. Embrace Citizen Development
Citizen developers are full-time employees who use low-code platforms to build custom applications from scratch quickly and at a low cost.
Rather than outsource requests to developers, they use their expertise with the workflow to create custom solutions.
While citizen developers aren't professional developers, they can manage simple application development. Or, they can work with IT teams to create more complex solutions.
Your citizen developers will need established frameworks and IT governance to succeed. But, they can effectively build the solutions they need without overwhelming IT teams with endless automation, integration, and custom app requests.
Several major organizations are leveraging citizen developers to reduce IT backlog and burdens, helping them achieve digital transformation faster.