Benefits of fixed price custom software development
Customers requiring the services of trained professionals are often looking for a fixed price associated with that service being successfully completed. This is commonplace in all industries whether you are looking to have your haircut by a hairdresser or have your dream home built by a construction company. Knowing upfront the price, the details of the service and the time it will take is reassuring and ensures a level of confidence for the customer.
Imagine a situation where you are at the hairdresser and while cutting your hair, the hairdresser actually cuts a little too much off one side. Originally your trip to the hairdresser was going to cost you $30 but now the hairdresser insists that it will cost $35 because of the extra time needed to rectify the mistake. This is exactly what can happen in the development of software.
With all good intentions, the software developer has developed a custom feature and delivered the software to the customer. Unfortunately this feature has a few issues and does not work completely as expected. The customer has already paid an invoice for the creation of this feature and now the software developer will invoice the customer for the work required to resolve these few issues.
Nobody enjoys these hidden or unexpected costs and this is where a fixed pricing model can help.
How does fixed pricing apply to custom software development?
As a business, one of the key measurements when undertaking a custom software development project is return on investment (ROI). The amount spent on developing the software can be deemed the investment and the amount of profit, whether this be time, money or some other benefit, can be deemed the return.
Under the fixed pricing model, you as the business, will understand that by spending $X you can achieve your desired outcome. This enables you to budget your finances accordingly and create future financial forecasts. In this instance, the risk of development has been accepted by the developer and any unforeseen difficulties related directly with the development of the software will not affect the agreed upon price.
With that in mind, it becomes necessary early in the project for the developer to engage with the business customer and document the project requirements. This documentation is required to be at a high enough level of detail for the developer to accurately price the project and ensure there are no missed assumptions or ambiguities. The project will then be delivered according to the documented requirements with minimal room for variation.
What!? What if I don’t know all of my software requirements up front?
It is unlikely you will have a complete detailed picture of your software ambitions up front. Software projects can vary in length and complexity and there is always a need to adapt to changing requirements throughout the project.
It sometimes can be difficult to accurately price custom software projects in their entirety before development has begun. There are quite often hidden complexities that are only evident during development and subsequently can cause unexpected cost increases.
These difficulties can be mitigated in a variety of ways but one major factor is experience in developing similar projects to the one being requested. Many businesses will request custom software that solves a unique problem however the core software framework is often common across many of these projects and this helps in being able to provide an accurate fixed price.
Another strategy to providing an accurate fixed price is to create deliverable milestones or feature sets. Depending on the size, these can be derived early in the project or during the project’s development. By dissecting the software requirements into smaller ‘chunks’, it’s easier to grasp the complexities and provide a fixed price. It also avoids the shock of that ‘big number’ being presented to the customer.
Our team at Qubisoft understand these issues and through experience, can provide a fair fixed price for your software project. We will help you identify your minimal viable product (MVP) which addresses the set of features critical to your software and provide you scope to add some additional features throughout the development process without increasing the cost. With the MVP developed, we can work through additional milestones that will enhance your software and ensure you won’t have the experience of investing money into some custom software that is never fully developed and not in a useable state for your business.
We don’t want the decision to create custom software for your business to be daunting or the development experience to be stressful. Speak with one of our experienced team members today to understand our Qubisoft can benefit your situation.