IT Outsourcing allows companies to use an outside organization to perform secondary IT functions for cheaper and in less time. This process has become very popular in recent years: in 2016, 72% of companies worldwide outsourced some of their IT operations. In 2020, due to coronavirus, this number skyrocketed to 93%. Last year the market for outsourcing reached $92.5 billion in revenue. Now it is over $110 billion. And the number continues to grow.
Similarly, outsourcing app development has also been very popular in recent years. The industry is booming. Even large companies with thousands of talented employees, like Blizzard, are outsourcing their mobile apps to third parties (see: NetEase and Diablo Immortal). It is not considered a taboo, but instead a wise business decision. Most apps in the top 100 on App Store and Google Play are now being outsourced in one way or another.
What are Some of the Benefits to Outsourcing Mobile App Development?
The primary benefit here is saving money. Mobile app development in the U.S. can be very costly: hiring workers, paying their taxes, renting office space, building a new team. Sometimes you have to hire business consultants, accountants, HR, cleaning staff, etc. The process can take months or years — and all you do is lose money, with no gain in sight. Meanwhile, hiring a third party that already specializes in mobile app outsourcing allows companies to quickly put together a strong team, and speeds up the process of releasing a completed product. All the while you lose a lot less money, since the companies that outsource app development usually hire best workers from countries where the average wage is quite low.
Other benefits include:
decreasing operational costs;
freeing in-house developers;
enhancing focus for the rest of the company (you can easily outsource projects which are secondary to the main business);
getting access to the best world-class talent, not limiting yourself to developers based in your country or area;
greatly speeding up app development;
assembling a technically strong team in the shortest span of time (great experts in their field are usually not available on the open market, but capable outsourcing companies usually have quite a few people with the right experience);
flexibility in terms of approaches and models: we at Smartbrain.io, for example, have employees from myriad of backgrounds; no matter what your vision for the project is, there are people who know how to bring it to fruition, and who have previously worked on developing something similar;
passing risks to the outsourcing company (paperwork, HR, projects being on time and employee satisfaction are their problems now);
the ability to start and terminate projects without extra hassle;
the best quality/price ratio.
All right, it all sounds good on paper, but how to actually get your mobile app going? Let’s say, you have an idea, something that will earn money or bring great value to your other products. How much will building an app for that cost you? What do you need to do to get everything actually built?
How to Outsource Mobile App Development in 7 Easy Steps
Here are a few key tips for finding great outsourcing companies for your iPhone or Android app development projects:
1: Figure Out the Requirements for Your App
Even before you start looking for an IT-company to outsource your mobile app development to, find out what you really need. What has to be in your app, and what are its key features? What would be the MVP (minimum viable product)? There is really no point in proceeding further without knowing the answers to these basic questions:
What platform should your app be on? iOS, Android?
Does your app need geolocation?
Would you want your app to have login features?
What will be your payment model: in-app purchases, adds, subscriptions?
Do you want to develop a free version, and an additional premium version of your product, to monetize it that way?
Will you need the integration with social media (and which ones: Facebook, Pinterest, Twitter, LinkedIn, Reddit…)?
Will there be any Payment Gateways?
A quality outsourcing company will still ask all those questions, so why not prepare answers in advance? This will make you sound more professional, shorten the time to find your ideal development team, and in general allow you to get a better sense of your project.
Once the idea for the app is settled, it’s time to find your ideal partners for this job.
2: Find an Experienced Outsourcing Company that does App Development
You can look for the right company according to the style of app you need. Focus on companies that have developers with experience in that field. For example, if you think you want an iOS-focused app, you will absolutely need developers with at least 3-5 years’ experience in that field. Same goes for Android or Hybrid.
Does your company look presentable? Do they have at least their own website, do they have a name in the industry, are they safe? It’s easy to find some remote workers ready for a gig on Upwork or Fiverr or Freelancer.com, but will they be experienced enough? In our experience, good app development requires a dedicated team and a manager. Unless you want a buggy mess, usually weeks or months late, you want to choose a solid company that can deliver seamless project completion. Usually it will save you money in the long run (unless you are outsourcing to someone from Netherlands/UK/US/Norway etc).
Some companies are good at making apps, some just aren’t. Those that are good — usually have some experience in the field. Preferably — at least 5-10 years, and a few successful apps under the belt. If you struggle between the company that’s experienced and the company that only does app development, go with the former. Established business processes and skillful employees will come in handy. A good app requires not only IT-engineers, but UI/UX-designers, marketers, artists, QA. It is valuable to align yourself with a company that can provide you with anything that you could need in the future.
3: Arrange an Interview With the Potential Candidate
You should know your developer or your team before the start of the work on your project. Each company has their own way of doing things, but generally you should have a talk with the company manager or CEO about the way you see your project development going forward. Communicate with them, preferably, in voice or in DMs. Email takes too long, and you don’t really feel like you are connecting to a person. The best solution is often be video conferencing. It allows you to quickly get acquainted with the person on the other end of the line.
Arranging an interview is simple, just use the contacts provided on the company’s website. You can do it via email or phone. Conduct a short interview on Zoom or Skype. Ask the developers/managers about their previous work in your field. Then, have a personal talk and get to know their character. Will you be comfortable talking with these people a lot for the next few weeks/months? Do you feel like you trust them with bringing your vision to life?
Developers should be engaging and responsive. They should ask a lot of questions, be competent and always on time. After all, if they can’t properly get into a short call with you, how do you expect them to be on time when trying to deliver a quality product?
Once you find an outsource app development company capable and trustworthy, you can start discussing the details of your agreement.
4: Negotiate the Deal
When you find a worthy developer, it’s time to negotiate for a price. Usually the price depends on the complexity of the project (= time investment) and developer hourly rates. The rates will be dependent on the country which they are from, as well as their expertise.
When you outsource app development, sometimes the company may ask for a price that is higher than you initially expected. Do not dismiss them right away. Most often, the price comes from experience: lots of people previously were willing to pay that much. They could be worth the price they are asking. In any case, it never hurts to negotiate some. But mostly focus on their engagement and ability to deliver a product. Don’t put them on bad terms with you, do not become “that client”. You might still work with them in the future, and keeping relationships healthy is always important.
If you want your app development to be cheaper, focus on outsource companies from countries with lower wages. The quality of employees there is not necessarily worse (in fact, it’s often the opposite: they are more engaged, committed and willing to negotiate).
5. Request a Project Plan
Proper app development outsourcing is impossible without an overall plan: what your project should look like, and when can you expect each of its features to be delivered. If you are not making this plan yourself, ask for it from the developers. Lay down a series of specific tasks which should be completed before moving on to the next task. You can tweak your plan at any time (preferably — before the project development starts).
6: Set up Milestones and Monitor the Work
After both parties are satisfied with the deal, and you have a plan you can follow, you should create a project timeline (or, again, ask the developers to create one for you). With breakdown into smaller parts — milestones that outsourcing company would need to achieve at a particular time. This will give you the ability to control the progress of your product. You will be able to see, if it’s going off the rails or coming in at a pre-negotiated pace.
The dates should be fixed: this will allow for smoother development. On these days, you should get in touch with developers and get a project breakdown. Test completed modules, design elements, and features. Don’t micromanage every detail every day, this can greatly hinder the efficiency of the outsourced team. But calmly confirm the quality of the work, and the timely manner in which it’s being done. If the goals are not met, there should be some penalties, but if everything is coming along great — ideally, there should be some rewards.
7: Test and App Release
Receive and test your fully working mobile application. Preferably — with a few trusted people, each on their own mobile devices. Check all the features, tap all the buttons. Ask your outsourced developers to thoroughly go through all the test results. They should eliminate every bug or small hiccup, and you will be ready for the app release. After that, depending on the agreement, the outsourcing company may still support the app, and release new updates or fix any problems that users have. This should not require too much additional investment — and, after all, your app is out, and (hopefully) is now ready to pay for itself!
How Much Will Developing an App Cost?
Knowing a realistic price range for the type of app you want to make is imperative. Your app is your investment, and you should know what ROI you will need. The cost to outsource an app depends on a few key factors:
country of the developers;
the type of app you need;
development time;
included features;
post-production support.
In addition, you have to consider:
back end development (crucial for certain mobile apps);
security costs;
architecture;
costs of design;
testing and QA.
According to research, outsourcing helps you reduce app development costs up to 70-75%. In the U.S. developing an app can require up to $180k-$300k. If you outsource, app development prices mostly range from $15k to $100k.
If you consider scope and complexity, a small simple app may require $15k-$50k, while with a complex project you are looking more towards the $50k-$80k territory. Building some apps may require $100k to $200k even when their development is outsourced. But that means building them in house in the U.S. it would have taken you close to a million.
Consider some common types of mobile apps and the average cost of their development:
App for real estate brokers — $12k to $15k;
Social app, network — $25k+;
Complex messaging app (think, Whatsapp, Telegram or Facebook Messenger) — $50k to $130k;
Dating app (Tinder, Badoo) — $80k to $180k;
Banking app — $50k to $70k (very important to double up on security);
Payment service app — $40k to $60k;
City guide — $25k to $50k;
Taxi booking (Lyft, Uber) — $25k to $100k.
All in all, outsourcing an app is often cheaper than buying a decent car. Car value usually only decreases with time, meanwhile a great app can make you rich, or at the very least provide some passive income.
The price range varies widely, but it mostly depends on the amount of features and geographical area of the company you want to outsource your mobile app development to. In terms of the price/quality ratio the best developers are usually located in Eastern Europe, Russia and Ukraine. However, some companies choose to outsource to other regions, including India, Australia and UK.
In general, Cost of the project = Developers time ∙ Developers hourly wage.
Here are the average software engineer hourly rate for mobile (iOS/Android) developers in each region:
North America — $150
Australia — $100
UK, EU— $70
South America — $50
Eastern Europe — $35
India, Asia — $20.
Facebook first started as a website that allowed users to add their photo and bio on a simple page. Airbnb used to be an app where three owners rented out their own apartments. Yahoo! was a web-page with a list of links to the biggest sites at the time. Instagram (which used to be called Burbn) flopped hard, with less than a few hundred registered users, but refocused on photo-sharing with filters and in 2 years sold to Facebook for $1 billion.
You don’t need to be the biggest player and you don’t need to have the most expensive app to be hugely successful. All you need is a good strategy and a working product, which can scale, grow, and bring value to the people. Even something as simple as Flappy Bird from Vietnam can be hugely successful and influential, bringing in over $50,000 a day. There is no reason your app can’t be just as popular. It all depends on the idea and marketing (viral or otherwise).
Meanwhile, the cost of outsourcing mobile app development is so low, we sometimes get clients that just want to build an app as a fun present for their loved ones. Sometimes, even these projects actually become somewhat popular, and net their creators a few thousand dollars every single week.
Developing an app is not as hard as people want you to think. Get in touch with a trustworthy outsourcing company and start discussing potential projects — it’s free.