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Product Strategy

Saas Development Cost: 4 Factors to Consider

Nisha Gopinath Menon
June 22, 2021

We've been in this business for close to a decade now, and as we observe the success of many of our clients, we started to notice a pattern. Most companies that approach us hope to emulate disruptors like HubSpot, Canva, MailChimp, and Shopify while competing against giants like Amazon and Salesforce. What the successful ones understood, and many still fail to realize, is that in today's SaaS services marketplace, whoever builds the best software (read UI/UX) wins.

Today, we're going to help you understand the price of the value you seek and what to compromise on if you're on a budget. This should help nail down your SaaS application development costs. But if you're only here for the ballpark figure, let me save you some time and hand you the answer right now, "It depends." If you want a better answer, ping us here, and our team will give you a number based on your requirements.

If you're looking for more information on how we reach that number, below are the top 5 factors that affect your budget, based on our experience with preliminary project evaluations of the SaaS projects we've worked on.

1. Do you need software to be your competitive advantage?

Too many companies still don't view software development as a core competency. Take Slack, for instance, the cloud-based instant messaging platform. What is the secret to their success? Ask their customers, and many would say it's their fiendishly good design. They didn't come out with some novel idea. They just built a really good product. Most users genuinely enjoyed using the software on a daily basis. Rather than operating as a traditional enterprise chat tool, Slack became a robot sidekick, helping customers through their day. Their secret to success was their software and features. Build well-designed software, and you'll have a service that people truly want to pay for.

When we were working on one of our most successful client management platforms, we focused on making the user experience really stellar, approaching it from different angles. We created customizable invoice templates, improved the customer tab, designed a clear onboarding, and more to make the platform easy to use and more efficient for customers. We drew inspiration from HubSpot. It's known for being very easy to use. They developed the UI in such a way that the user can intuitively navigate through every component and very quickly learn how each tool operates. The layout is well-categorized and clear. Even a person who's new to such tools would understand how to get the work done. People tend to choose services that offer hassle-free and simple experiences. It means you need to show a strong value proposition and great UX.

For this, creativity is key in your development team. Engineers aren't just seen as builders at CognitiveClouds. They are creators and free thinkers. This has let our engineers create a huge variety of successful products and apps for clients. So, either build your own software development team and empower your developers to be creative problem-solvers or partner with a custom software development firm that houses such a team. Custom software means your product can be perfectly tailored to the unique needs of your customer base. But typically, the more the customization, the more the cost of your SaaS development. Here, you'll have to weigh value vs. worth. How much value is that customization going to bring you?

2. Have you defined the scope of your SaaS application?

Another essential element that influences the pricing is the scope of your SaaS. Are you looking to build a platform or a tool? Tools typically aim to perform one or two things incredibly well and are limited in their scope. Take Hootsuite or Buffer, for example. Platforms are "fully-featured" and usually comprise diverse tools that allow for full functionality. Facebook is an example of this. If you're unsure, we highly suggest keeping the scope as confined as possible. More often than not, you're bound to underestimate the time it can take to build the system.

The cost of building a fully-featured platform will be more than for building a tool. After you earn some gains on your MVP (minimum viable product) with a developed tool, you can add new specialties to the system.

3. What platforms are you considering?

The two main ones considered for SaaS development platforms are PC and Mobile. Accessibility of your software on both platforms is important, but it will raise the cost. Most B2B SaaS companies prioritize PC over mobile. Integrating it is the most productive approach as employees work majorly on desktops. Mobile SaaS app development requires re-imagining a lot. Screens are tinier, and the orientation from the PC screens is usually flipped. It has to feel like a similar kind of service but a completely distinctive UX. It's often harder to upscale the UX for the PC than to downscale it for the mobile.

The cost of SaaS app development can range anywhere from 1/2 to 2x the cost of your PC application development. You can initially focus on getting the service running on a single platform to start earning revenue before working on another, which may have confined benefits for your customers.

4. What's your deadline?

The average time to develop a minimum viable product for SaaS is usually 3-6 months. Also, consider that you might not need an MVP to meet your initial goals. If you're looking to get an investment, you do not need an MVP. You need a demo for the investor. It's usually called the POC or the Proof of Concept. When we analyze the project, our team discusses your goals, helping you better define the strategy. If you do not need an MVP, a POC requires significantly less work and less time to build.

We also understand that time is money. Businesses can no longer spend months developing new products. Our developers stay in regular touch with our clients. This removes organizational barriers and requires less correction, and they can serve your vision better and build features in less time. We aim to reduce time to market, but that does affect your budget.

Here are a few things to consider in this aspect:

  • Validation: This includes determining your target customer base, evaluating potential competitors, managing stakeholders, etc. This process typically takes about 10-50 hours.
  • Planning: Based on the scope of your product, this would take anywhere from 25 to 180 hours. Investing time in planning early on can save you time later.
  • UX Design: This takes around 20 to 180 hours. UX is incredibly important for most SaaS products. Project Management  
  • Project Management: This can take about 20 percent of the time. Managing the various phases of the development so as to stay on track is as vital as the development of it.

The good news is: It is easier to build good software today than it was even five years ago. Automation and modern developer tools have helped speed things up. And keep in mind that the first version of your product or project should be as simple as possible with only the basic functionality. The deeper you go into development, the higher the cost of making a mistake. The later you get user feedback, the more expensive the mistake will be.

Need help with product design or development?

Our product development experts are eager to learn more about your project and deliver an experience your customers and stakeholders love.

Nisha Gopinath Menon