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How Much Does It Cost to Hire Software Developers in 2020

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Once an idea for a software project has arisen in your head and you have outlined the project details and specifications, it’s time to decide how to execute your plan. In this article, we will answer a pool of questions commonly asked by customers in the process of hiring a software development team.

Read on, or jump directly to the one that bothers you the most:  

  • How much does it cost to hire developers? Freelancers, dedicated developers, and in-house developers compared.
  • How will we communicate if my developers are in a different time zone?
  • Will I be able to observe how development is going?
  • How will the developers learn the details of my project?
  • Who will pay for downtime and other expenses?
  • How do vendors check the quality of the software?

Let’s get to the point.

How much does it cost to hire developers? 

There are three main types of developers who can carry out your project: freelancers, in-house developers, and dedicated outsourcing teams.

Freelancers are mostly found on freelance websites, where they post their portfolios and search for relevant tasks. We will review Upwork and use it as a source of information about developer rates.

How much does it cost to hire freelancers

Average freelancer rates according to Upwork.

According to Upwork, freelance developer rates are:

  • Web front-end: $60-$85 per hour
  • Web back-end: $85-$160 per hour
  • Desktop development: $40-$110 per hour
  • Mobile development: $50-$160 per hour

For freelancers, physical location doesn’t play a big role in pricing, because they tend to work for a global market remotely.

If you’re considering developing a project that requires constant attention and uncompromised quality, it’s better to consider other options. Freelancers will probably not be as dedicated to solving your business problems as in-house developers or dedicated teams could be.

Looking for dedicated software professionals?

You have found your perfect dedicated team here – at HQSoftware, we are ready to provide you with the best-in-class developers with extensive experience.

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Head of Sales
at HQSoftware

A second option is to hire in-house developers and other staff that you will need during your project: a project manager, designers, testers, and so on. This is an extremely expensive approach because you will need to carry all expenses related to hiring and retaining staff and keep them in-house for a longer period than the project may last. 

Remember that when you consider the salaries of in-house developers and the hourly rates of outsourcing developers.

Salaries for in-house developers depend on location and, of course, skill. According to Indeed, Payscale, Neuvoo, and Glassdoor, average numbers are:

USA:

  • Web front-end: $108,816 per year / $52 per hour
  • Web back-end: $127,214 per year / $61 per hour
  • Desktop development: $96,334 per year / $46 per hour
  • Mobile development: $124,654 per year / $59 per hour

UK:

  • Web front-end: $110,740 / $53 per hour
  • Web back-end: $130,900 / $62 per hour
  • Desktop development: $102,340 / $49 per hour
  • Mobile development: $126,725 / $60 per hour

Canada:

  • Web front-end: $97,500 / $46 per hour
  • Web back-end: $115,000 / $55 per hour
  • Desktop development: $105,236 / $50 per hour
  • Mobile development: $92,625 / $44 per hour

Germany:

  • Web front-end: $76,350 / $36 per hour
  • Web back-end: $78,670 / $38 per hour
  • Desktop development: $90,660 / $43 per hour
  • Mobile development: $93,050 / $44 per hour

Note that you also need to organize their workplaces, provide benefits packages, and so on. The costs are extremely high.

How much does it cost to hire in-house developers

How much will you spend on in-house developers in different countries.

The third option is to hire a dedicated team. This differs drastically from hiring developers in-house because it is cheaper, easier, and doesn’t require carrying extra HR costs; you get a wisely composed team of experienced software professionals that will develop and implement your project, enhance and support it if you want. Then you’re ready to go corner the market with your product.

If you choose this route, you’ll need to consider the developers’ physical location, because it will help determine rates.

For example, if you hire software developers from the US, there will be associated expenses such as social security and unemployment insurance contributions. Rates of European developers will take payroll taxes into account that cover social insurance and other costs. 

Since Western markets have higher costs, it is better to explore other regions.

How much does it cost to hire a dedicated team

How much will you spend on a dedicated team.

For example, Eastern European markets provide highly educated and English-speaking developers who work for a pool of software outsourcing companies with modern working cultures. They also boast former-Soviet technical background, comply with EU law and worldwide regulations, and enjoy extra bonuses associated with local IT clusters.

Take a look at companies from Belarus and Estonia for these aforementioned benefits, and also modest rates:

  • Web front-end: $25-35 per hour
  • Web back-end: $30-40 per hour
  • Desktop development: $33-43 per hour
  • Mobile development: $33-43 per hour

How do outsourcers carry out communication in different time zones?

If you have decided to work with a Belarusian company, some questions may arise, such as how to build efficient communication processes when your developers are in a time zone many hours different from yours.

In 2020, most of the world had to turn to remote communications due to the COVID-19 pandemic, and as we have discovered, global communications have been revolutionized. The only problem a different time zone creates right now is a delay in response time.

How to communicate if you are in different time zones

How outsourcers overcome communication challenges.

But dedicated developers are used to working flexible hours, and even if the difference amounts to 9 hours it is possible to reduce communication challenges considerably.

How do outsourcing vendors make the development process transparent?

There is no need to worry about your project being worked on from a distance; the developers will make sure you’re fully informed about the process.

There are tools that provide instant access to project status and will allow you to know exactly what is happening on your project right now. Tools such as Jira and Trello provide the status of various tasks and who is assigned to each one, while communication tools such Slack, Skype, Zoom, and emails allow you to talk to your team at any moment.

How is the development process made transparent

How to see the process from the inside.

Therefore, you will remain fully informed about everything that happens on your project. This is the norm for any reputable outsourcing company.

How do developers learn about my project?

If you hire software developers to enhance an existing product, they need some time to get into technical details before they start to work. This process is called knowledge transfer, and it can be carried out in two ways.

  1. Online knowledge transfer. An easy way to fill the team in on the details. Can be conducted through video calls and desktop sharing in Skype, Team Viewer, and similar tools.
  2. On-site knowledge transfer. A dedicated team of developers will travel to the customer’s office and gather all the required information personally. Another option is that the client can come to the developers’ location to provide needed information.

How do developers learn about my project

2 ways for developers to learn about the project.

Decide which option to pick based on the complexity of the project and your own capabilities — the team will adjust.

Who is responsible for downtime? Who pays for expenses?

The answers to both of these questions depend on the project type and on the type of contract you sign with your vendor.

Ask your vendor about what will be covered in your contract as to payments, because the terms may vary.

For example, hiring a dedicated team often implies that the vendor is responsible for downtime and the customer pays only for the team’s actual working hours. The vendor is also responsible for accounting procedures, payroll, taxes, the supply of equipment, and so on.

Who pays for expenses and is responsible for downtime

What you should learn before signing a contract.

If you have a long-term project and want a high-quality solution, we suggest choosing a dedicated team. If you have a simple or short-term project, take a look at other cooperation models, such as Time and Materials, or explore how outsourcing companies work in detail.

How can I control the quality of the software?

Before picking a software development vendor, carefully check what customers say about this company; find reviews and comments on the vendors’ website and special platforms.

There are research agencies that specialize in aggregating customer reviews about software development businesses, and you can take advantage of such websites:

Just pick a service or technology that most interests you and find the best companies based on ratings and reviews from real customers.

How can I control the quality of the software

How customers can control the quaality of the software.

The second step is to learn how your vendor will control and prove the quality of their services.

Companies often provide references for finished projects and can show you successful cases similar to your future project.

Other factors that affect quality:

  • The skill of developers — senior developers charge higher rates, but they are more skilled and can deliver quality;
  • Corporate competency centers — if a company has one, you can be sure that it will follow the most advanced best practices in developing software.

The Bottom Line

In this article, we have answered the questions that bother software development service customers the most. A short recap:

  • How much does it cost to hire developers?
  • How do outsourcers carry out communication in different time zones?
  • How do outsourcing vendors make the development process transparent?
  • Who is responsible for downtime? Who pays for expenses?

If you have additional questions ,we will be happy to help; don’t hesitate to drop us a line!

Read also

How Much Does It Cost to Build en E-learning App and Platform – Project Types and Estimation

How Much Does It Cost to Make an App?

Looking for a Dedicated Team: a Complete Guide for Businesses

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