Banner: Cost Breakdown for Developing a SaaS App in 2022
High Seas Team

High Seas

July 1, 2022

The Top Factors Contributing to SaaS Development Cost

The cost of developing a SaaS app depends on the project scope, and the guideline below is intended to give you an idea of what it might cost, not an exact number.

Many factors contribute to software development, and each project is different. The best choice for getting an accurate software development cost estimation is to request a quote from a SaaS development company. You’ll want to make sure to provide developers with as much information and detail as possible to get the most accurate cost estimation.

Factors Affecting the Total Cost of a SaaS Product

The typical software development cost for simple, custom SaaS products is between $150,000 and $750,000, with more complex SaaS products beginning at around $750,000 and going up from there, depending on your SaaS app’s required functionalities and their complexity.

Our SaaS application development company would be happy to consult with you to determine a software development cost estimation. Our expert development crew will form a full understanding of your project requirements and, using a number of factors, give you a range of likely costs you can use to guide your project budgeting.

SaaS Development Company Location

A significant factor in your total SaaS development cost is the location of the SaaS development company you hire. If your SaaS development company is located in the United States and, particularly, in a region like the San Francisco Bay Area or New York City, your development costs will be much higher than if you were to hire a smaller agency in a less expensive region.

Keep in mind that tech hubs like San Francisco and NYC also tend to have more skilled developers than more inexpensive, less tech-oriented regions because that’s where the top tech talent tends to gravitate. You don’t necessarily have to choose a developer in a tech hub, though. Most SaaS developers in the United States, while more expensive than in other countries, will provide higher quality customer service and end results. 

If you hire a company in the United States for your SaaS application development project, you can expect to pay between $150 and $350 per hour for their services. If you’re looking for a more cost-effective SaaS software development company, you might decide to hire a developer in Eastern Europe or India, for example, where you can expect to pay closer to $50-$150 per hour.   

Another aspect to consider when choosing what location or region to search for a professional SaaS development company is that it’s much easier to effectively communicate with people who speak your native language. If the company is located in a nearby time zone, that further simplifies your collaboration with developers, and you won’t have to communicate while on opposite sides of the clock. Risking miscommunication during SaaS software development can lead to unsuccessful projects that need retooling before they become effective and functional, further deviating from the software development cost estimation. 

The cultural fabric that people in the same region share can go a long way in smoothing communication and collaboration mishaps that can occur when working with people who have different cultural norms. Working within your comfort zone culturally helps to ensure everyone’s on the same page regarding project timelines, expectations, workflows, collaboration structures, and subtleties of the software, such as its aesthetics and user flows. 

It’s crucial that the developers you choose for your SaaS application development are experts who know how to dive in and collaborate with your company stakeholders to form a full understanding of your business and goals. Failing to adequately develop this understanding may result in missing technical and functional requirements that aren’t obvious. Issues like this can compound into foundational problems that affect the usability and effectiveness of the entire finished SaaS application.

SaaS Product Planning

Creating a successful SaaS product with accurate software development cost estimation requires expending time and effort to create a SaaS development plan. With the help of your SaaS development company, you’ll define your target audience, business goals, and the objectives your custom SaaS product is intended to reach. 

When beginning the SaaS software development process, it’s important to work with experienced SaaS developers who can help plan your application and make early decisions before coding. These early decisions might include choosing the most suitable tech stack and eliminating unnecessary processes.

A highly competent SaaS development company, such as the crew at High Seas, can help you compare their services with their competitors, form an accurate estimation of project budget, and plan the application development process.  

While it depends on your SaaS project’s specifications and requirements, simple SaaS product planning usually takes somewhere between 40 and 250 hours. More complex SaaS products with many integrations and functionalities usually take an excess of 250 hours to plan.

SaaS MVP Development

In SaaS application development, a minimum viable product, known as an MVP, is an early version of a product that contains only the application’s core features while still delivering value and meeting users’ needs in a fast, simplified way. 

MVP SaaS software development can be helpful for validating ideas and rapidly launching an in-demand product. MVP releases are also beneficial for concept representation and analyzing what level of funding will be required to provide users with a beneficial application. 

MVP development isn’t just about developing a stripped-down version of a SaaS application, it’s about building the product in such a way that it can be quickly validated by the market using the least amount of resources. 

Simple SaaS MVP application development typically takes around 300 hours, with more complex applications taking 1000+ hours to develop.

UI/UX Design 

The UI and UX design of your SaaS product is vital to its success. When UI/UX design is planned and implemented properly and thoughtfully, it will improve the user journey by delivering an efficient user experience while reducing customer churn rates. Generally, the UI/UX design phase of developing a SaaS application will take 250+ hours to complete. 

Some of the best UI/UX design practices are:

  • Navigation: The most important aspect of designing SaaS applications is providing users with a simple-to-use, intuitive user interface. If it’s not an easy product to use and doesn’t make sense to most users, not many people are going to begin using your SaaS app and stick with it.
  • Dynamic Sorting & Filtering: Users can use the dynamic sorting function to refine searches. For example, users can refine searches by category to receive only the relevant information they need.
  • Simple SaaS UI Design: Ideally, and in most cases, a straightforward, easy-to-understand user interface design should effectively cover all the necessary nuances of SaaS architecture.
  • Easy Sign-Up: Creating a simple signup form that contains each additional step separating you from users makes it easy for them to join your SaaS application.
  • Personal Touch: Most users appreciate an easy way to access company personnel, whether that’s a contact form an online chat window, even if it’s manned by a bot that takes their information, query or complaint and sends it to the appropriate department.
  • Customer Feedback: Conducting surveys to get feedback from your customers is something most successful SaaS companies do, as maintaining contact with your customer base is what keeps them connected to your application.

Front-End Development

Everything users visually see and interact with in their browser or application is managed by SaaS front-end application development, which typically takes between 200 and 600 hours. Front-end SaaS developers are responsible for creating the look and feel of a site or application. Developers will take your UI/UX designs created by your designers and convert them to HTML, CSS, and JavaScript code, which are the core languages used to develop SCSS files for page elements from mobile to desktop. 

The developer team will likely also use React, Angular, and other front-end libraries to help them create your SaaS app’s front end.

Back-End Development

The software development cost also relies on back-end developers to figure out the best setup for a serving platform and set up the environment to begin coding the system. Most back-end SaaS software development takes around 800 hours. 

A major factor impacting the software development cost estimation is the hosting fee for your SaaS application. For users to be able to use your application, it needs to be hosted on a server or multiple servers. The cost of hosting your SaaS application depends on the size and capacity of the server and how much traffic your site or application receives. 

Another factor that could raise your software development cost is whether your back-end developers need to purchase third-party software tools, development libraries, datasets, or databases. The costs for these tools and other components can vary significantly, depending on which are needed and the number of users that will need access. 

You’ll also need to consider the administrative costs of back-end development, including managing user accounts and permissions and setting up and backing up data.

Quality Control and Testing

For every SaaS application development, developers will use established criteria covering your project’s requirements to discover, identify, and fix any development issues or bugs during UI and UX testing. Generally, the overall software development cost estimation includes SaaS product testing. You’ll also want to do your own quality assurance (QA) testing, because developers may have unintentional biases that could impact their testing processes. 

Each SaaS application undergoes rigorous testing processes to ensure we catch any issues and resolve them before deployment. These tests include:

  • Usability Testing: During SaaS software development, usability testing is used to gather real-world data and feedback from your users regarding the software experience. Generally, developers will try to use a group of your users or customer base to achieve the most accurate, valuable data and insights.
    Developers perform usability tests by observing your users attempting to complete certain tasks using the SaaS application and analyzing users’ feedback to form hypotheses. These hypotheses guide subsequent iterations of your SaaS software development.
  • Simple A/B Testing: We’ll do several rounds of simple A/B tests, showing small groups of users two or more variations of each of your SaaS application’s pages. Statistical analysis then determines each user’s preferred page variant and which variant performs best for a given conversion goal.
  • Multivariate Testing: Similar to A/B tests, multivariate testing shows users multiple combinations of page variants simultaneously to find the best combination of features and user experience components.
  • Code Quality: Developers thoroughly analyze your SaaS application’s code to find and eliminate any bugs, ensuring the final product is up to standards and satisfies all of your project requirements.
  • User Experience Testing: Developers will test the user experience of your SaaS application by observing users and getting their feedback. It’s essential that your app is easy to use and provides the best user experience possible that satisfies all your users’ needs.
  • Performance Testing: We’ll do performance tests that gauge the speed and responsiveness of your SaaS application for different traffic volumes to ensure it holds up under different scenarios.
  • Compatibility Testing: Developers will test the compatibility of your SaaS application with the different types of devices and operating systems that users will access your SaaS app from, ensuring each functions correctly and provides the same level of user experience.
  • Security Testing: There are many risks and reliability issues associated with SaaS applications. You’ll want to be sure to contract reliable cloud service providers like AWS, which will be the best option for safeguarding your company’s and users’ sensitive data.
  • Unit Testing: The smallest executable components of a SaaS application are called “units.” Each unit is isolated, then individually validated to ensure proper functionality and orientation within the application.
  • Integration Testing: Each of the third-party integrations added to your SaaS application must be tested to ensure each functions as intended and collaboratively with the other integrations and components.

Product Launch and Implementation

There are multiple factors that contribute to your overall software development cost breakdown, including hosting fees and support and development costs. You’ll also need to consider the marketing and sales expenses.

Another important factor you’ll want to take into consideration before launching your SaaS product is the customer acquisition cost (CAC). You can keep the CAC as low as possible by focusing on creating an efficient marketing strategy and competitive pricing structure, which will ensure your SaaS product launch costs remain under control.

Maintenance and Improvement

Maintaining a SaaS product after launch can vary broadly in cost, depending on the business, the size and complexity of the application, and the number of users. Generally, maintenance costs are higher the more complex an app is. 

Typically, maintenance costs for SaaS products are charged on a monthly or yearly basis. Some SaaS providers offer clients a discount for purchasing more months at once. 

Maintenance costs rely heavily on what type of SaaS product you have and which platforms (web or mobile apps) you need your SaaS application to be accessible from. Your maintenance costs may also go up if your app requires 3rd-party data store updates and app maintenance. 

A $200k custom SaaS product usually costs between $5 and $10k per month to maintain, or 5 to 10% of the cost to develop the app.

SaaS App Development Cost Projections

The below software development cost projections are for medium-sized SaaS development projects. They are not fixed projections, they’re just intended to show you an estimation of what your software development cost breakdown might be. You can get a more accurate software development cost estimation by requesting a quote from the development crew at High Seas.

Development Phase Cost
Business analyst for market research $150 - $500/hour (Small businesses or early stage startups may not need a business analyst)
Product planning $15,000 - $30,000
Developing MVP $25,000 - $100,000+
UI/UX design $20,000 - $50,000
Front-end development $50,000 - $200,000
Back-end development $80,000 - $300,000
Quality control and testing $5,000 - $20,000
Support and maintenance $5000 - $10,000/month

Launch Your SaaS App with High Seas

While your software development cost estimation might be different than the above projections, the crew at High Seas can determine an accurate software development cost breakdown after establishing your project requirements and timeline. 

We’ll consider each of your project’s required functionalities, along with the timeline and any other factors that might impact the overall software development cost, such as third-party integrations and complex features and tools. 

Contact the crew at High Seas today to receive your SaaS application development quote and get your project started.

High Seas Team
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