The most important question for an entrepreneur who decides to build a mobile or web application is “how much does it cost?”.
There are two types of developers: those who work with a fixed price and those who work only with time & material. After reading the article, you will understand how companies evaluate the cost of labour for software development services, and you will understand which category of customers you belong to.
To give a fixed price an agency has to define a scope, which is the hardest part in the software world. Asking for a fixed price of services is similar to figuring out what is the total cost of lawn mowing. Once we know the size of the field, it is easy to give an exact estimation.
Which of the following categories do you belong to?
Case 1. Customer know’s the size of the field exactly and already mowed his lawn many times.
Such customers don’t usually look for new service providers but use those with whom they have a history or relationships and built trust (somebody’s account). Or such customer do lawn mowing by themselves (in-house team). No need to switch your case.
Case 2. Customer somehow knows the size of his field and mowed his lawn once or twice.
And might look for another team to do that soon. Maybe somebody can do that better or cheaper, or faster, or have ability to start soon, or do some extra services. Maybe those with whom he worked are unavailable right now or the prices are too high for customer in current situation.
In this case either the team is ready to do the work or not. It is easy to select the vendor, probably there are enough of them on the market. It is just a “simple” selecting process. After 5 times you should have trusted relationships and be safe unless you move to another location.
Case 3. Customer knows the size of his field approximately and a budget range for that.
Customer does not know really how much of the field has grass that should be mowed. If a vendor just told you the total price right away ask him how did he know the field size? Did he do that here already? Or exactly the same (how does he know this is exactly the same)? Or, maybe +-5 or maybe 10.
If you trust the vendor who offers the lowest price from your budget range or highest. In that case you are probably interested in the quality and speed of work than in the exact price.
Your place is less than a football field and bigger than a regular small backyard? Wait, what is regular? Oh, probably you are an example of Case 4. Or at least need some help to measure. It is hard to compare vendors on what is included in a total price because they think about different sizes by orientation on their experiences working with other fields, which are somehow similar to yours.
Remember there is no such thing as price per unit in software development. Price per hour? What kind of Lawn Mower machine does the vendor have? If yes is the gas included? If not, scythe or Grass Hook?
Case 4. The customer does not know the size and understand that measurements needed.
Either measure the field by yourself (if you know how) or ask to measure it. Ask to see those measurements, so you can understand the calculations. It’s okay to have a rough estimation before the measurement.
It is not really okay to start mowing without a knowledge of the size as fixed price work. Because somebody is going to lose in this game. And you don’t want unfinished work. Because while you are searching for a new vendor, the grass comes up and you have to do all over again.
Your fields are unusual or have no fixed edges? Mown the minimal valuable part of it so you can live (minimal viable product) and after mown stripe by stripe (agile).
Easy to start, not easy to finish, hard to make the most beautiful mown. You will get in nice and pleasant if you pick a vendor who really loves their work and is respectful to your field.