If you’ve managed to get at least three software development estimates, well done – that’s the first step in the right direction. Now, here comes the tricky part: making sense of it all.

The software development field is rife with jargon, so it’s normal to feel overwhelmed if you actually have no idea what any of these software development quotes mean. After reading this, you should be able to navigate the time, cost and team size conundrum, so that you know exactly which quote is going to align with your project.

Writing software is not like building a house or fixing a car

 People tend to assume that development agencies should be perfectly capable of providing a reliable estimate ahead of time – just like the mechanic or builder would. But it’s easy for mechanics, because they’re working with known materials, and building known things in known ways. It’s like telling a builder to build a house, but you don’t know what kind of house it is, what materials you’re going to use, how big the house is, or whether it’s even a house at all, rather it’s something else.

That’s what it’s like with custom software development. A massive part of the system is being built from scratch. This means that the way it’s put together and how it’s ultimately going to work are all moving targets. So, the path a developer takes and the destination they’re going to end up in is unknown from the very start of the journey.

Getting accurate estimates for custom software development isn’t easy. Estimates are wrong nearly every single time.

That’s not necessarily your fault or the fault of the developer quoting you. The reality is that it’s just too early in the development life cycle to tell. So, you shouldn’t put much weight on the first estimated quote you get.

Rather see it for what it is: a rough idea to help you understand how long the project is going to take, based on your preferred project methodology.

When reviewing the quotes you’ve received, you should calculate the time estimates as an average of the three quotes for each feature. This might not necessarily reflect exactly how long it will take, but it at least won’t leave you wondering why the project is taking longer to execute than initially estimated.

You also have to consider the team size and how that will impact your quote. Unfortunately, there’s no magical number that an agency can give you here because each software project can vary quite radically.

In 2019, the State of Code Review surveyed 1,100 developers in companies of all sizes. The data indicated that the most ideal team consisted of seven operational members. Ideally, in this context, meant that there was a good balance of efficiency, transparency and communication ability.

Another concept to consider is the Ringelmann effect that says individual group members tend to become less productive if the team size increases.

When looking at your quotes, watch out for your project potentially being over-resourced, leading to unnecessary costs or under-resourced, leading to late or non-delivery risks.

If you’ve been quoted on a big team, find out if the feature work is going to split up, so that they’re working on it in parallel. Or, if you’ve been quoted on a smaller team, ask them how they intend to overcome single person risks or deal with project delays.

Six things you should expect to see in vendor quotes

  1. An executive summary – this should outline the problem, their solution, and why working with their team is best for your project. This is helpful if you have to present quotes to various stakeholders.
  2. Problem statement and goals – this is probably the most important section of the quote. Make sure the vendor has clearly articulated your problem areas and what the goals of the solution are. A great vendor will also include the potential return on investment statement if that is the purpose of your solution.
  3. Methodology – they must indicate which method they will use to build your project, because methodology heavily affects price. An agile method can lead to cost blowout and the waterfall method can impact the time to complete the project. You will need to weigh up the benefits and pitfalls of whatever method they have selected.
  4. Key players – it’s important to know who you will be working with and what the expected ‘rules of the game’ are. You don’t have to know everyone on the team, but at least who you can expect to bump into on the journey.
  5. Project proposal – this should break down the work that needs to be done to make your project successful. This is the meatiest part of the quote, so read it carefully to ensure you don’t miss anything. If there’s any ambiguity about a feature or a task, go back to the vendor to clarify.
  6. b – usually the last part of the document, it’s the one everyone flicks to first.  Sure, it makes sense to get an idea of what kind of cost you’re looking at, but the cost makes so much more sense in the context of parts 1-5. So, if you look at the cost first, make sure you flick back to page one and understand how the vendor eventually got to the estimate.

Those are the six main things that should be in your quote, but you can expect a few other parts like the company history, what tools they plan on using, their testing methodology and communication process, what they expect of you, who the leadership team is and what happens after the product launches.

The question is … should you go with the cheapest option, or will the more expensive option pay off in the long run? Of course, the answer is: it depends. You need to uncover what’s good value for money.

You want a vendor that is offering the highest quality, a fair-priced proposal, a well thought out methodology and a resourceful team size. It may be that the cheapest quote offers you all of this. Or it may be that you’re going to have to go with the expensive quote. That’s a judgement call you’re going to have to make.

Remember to ask questions

And then ask more questions. And keep asking questions until you get all the answers you want and need. Once you have all the clarity you can get, then you’ll be in the best place to make an informed decision.

Don’t be shy and don’t feel bad. Remember, these companies want to work with you. If they’re getting annoyed at you trying to clarify things, they’re probably not the right fit, because you can expect that you’ll have plenty more questions to ask throughout the development process.

If you’re in the process of looking for quotes and a developer, feel free to get in touch with us at Spring Digital to see how we can help you.