• Please enter your DISQUS subdomain in order to use the 'Disqus Comments (for Joomla)' plugin. If you don't have a DISQUS account, register for one here

Core Business Blog

Keep up to date with CoreSolutions

The Software Cost Conundrum

Money being measured and calculated

How much will this cost, I just need a best guess right now

When you are in the business of custom software, this is a question that gets thrown at you countless times— be it on a trade show floor, a meeting or even while enjoying a quick coffee get-together.

How does a salesperson answer that? Any custom application requires attention to detail, workflow, understanding employee process as well as access to solutions.

Is the answer to name a number that meets minimum thresholds? Say for example $10,000. Or is the answer to blurt out $100,000 to every inquiry, because typically for small to medium customers a custom application will cost anywhere from $10,000 to $100,000. Not everybody requires a $100,000 solution but vying for the cheapest version of the system you need could mean trading price for quality. As with most things, the answer is in balance and the truth usually lies somewhere in the middle.

It is also important to understand the difference between price and cost. Price refers to the posted price of the product or service. Cost, however, considers ROI as well as what you stand to lose in time spent on problem-solving, efficiency, implementation and so on. To further clarify the concept of ROI, consider purchasing a coffee maker and making coffee at home versus buying coffee every morning from your local coffee shop. If you spend $10 per week on coffee at the cafe, while the upfront cost of buying a coffee maker will run you $45, in addition to $10 for your first bag of coffee, then within roughly 1 month, your investment will have paid itself off. Now that seems like a worthwhile purchase, provided you’re okay with brewing your own coffee.

Image of a money bagAt CoreSolutions, our development processes first step is known as “Discovery”. Before beginning development, we sit down with the client to define basic project parameters, document project details and refine goals into a set of system requirements which are leveraged to collaboratively build a pre-design wireframe. This is an essential part of our process as it allows both parties to understand the workflow, project scope and employee interaction required. Any process changes can be identified and addressed in the pre-design process before we build or develop the actual application. By the end of the pre-design process, we are better positioned to provide a very accurate number in terms of budgeting the project - and projecting ROI.

So, when clients ask me “how much will it cost”, I often respond with my own question: “how much is it worth to have the best possible understanding of the workflow before anything is developed or built?”

Whether you need help building your solution or are just looking for a consultation; we are happy to help.

If you enjoy our Business blogs, be sure to subscribe to our Core Business Newsletter!

Leave a comment