“I just wanted the world to see I was real with it | Wanted a deal, got it, and couldn’t deal with it” – Joe Budden
Previously, I answered the most popular question ever regarding mobile app development: How Much Does It Cost To Build A Mobile App?. You’ve since read that post, done your homework, found a great service provider (still looking, hit me up), answered all the questions about pre-engagement cost levers, and have a price that’s on budget.
You are good to go, right?
“But if the devil’s in the details, then I’m Satanic” – Drake
Don’t be blindsided by a good deal. (All respect due to Stevie Wonder … he’s a national if not global treasure!)
We only discussed the pre-engagement factors that affect the cost of developing a mobile application. However, there’s a major, hidden, shady A.F. way that costs can increase during the engagement, and it is all in the contractual statement of work.
RISK MITIGATION IN CONTRACTS
Typically, engagements will either be of one of two contractual formats:
Fixed bid: the product requirements, deliverables, necessary work effort and resultant price are set in the statement of work contract – ostensibly a low-to-no risk engagement
Time & materials: given a degree of uncertainty, client pays the contractor for the work effort exhausted toward achieving the statement of work, understanding that the desired deliverable may or may not be achieved within the contracted work effort
One can debate the merits of either format from a budgetary or resource planning perspective, however, in our experience, this is immaterial due to an unethical trick in practice.
FIXED BID TRICKS
Clients inexperienced with contractors may opt for fixed bid given the attractive benefit of a known price – it is an easier internal sale. Some unscrupulous contractors leverage this to win the engagement via a low fixed bid, while also withholding some of the unknowns necessary to complete the deliverables that have not been detailed in the contract.
What then happens is a slippery slope. The engagement kicks off, everything is great, work is getting done, but then, the unknowns are revealed and a work order or change order is presented as it deviates from the contract.
Uh, oh .. your fixed bid price is no longer fixed!
At this point, the client is stuck with the contractor, so there is no competitive bid on the work/change order. Whenever the scope of work creeps, so does the price. Now you have to go back and ask for more budget after you promised fixed costs. Ouch.
“But what I’m doing is not a good look | I never did it by the good book as a lifetime crook” – The Roots
In the world of mobile apps, where the hardware and software technology is constantly being updated, there are a host of unknowns that make fixed bid historically difficult if not impossible to navigate. Repeat after me:
Fixed bid mobile development is an aggressive business tactic that never ends well.
TIME & MATERIALS TRANSPARENCY
In a time & materials contract, where there is clear definition of price-for-level-of-effort rates, the client understands implicitly and explicitly how scope creep affects the pricing. We find that this clarity aligns both the client and contractor:
We both know directionally where we want to end up.
We both understand that there might be some known unknowns and unknown unknowns along the way.
We agree on how the pricing structure will work in advance of those eventualities.
Though it takes more time to explain the value of time & materials, there’s a beauty in being transparent, resulting in better mutual guidance, fewer legal rotations, happier clients, and repeat business or referrals. 👍🏽
I pride myself on running an ethical mobile advisory and development business, where we reveal every risk, every cost, and every solution path before signature.
If you’re looking for a trusted, ethical mobile services partner, please consider Touchlab. We’re ready to earn your business. My name is Jeff. I help build businesses.
Everyone I know: “How much does it cost to build a mobile app?”
Me, with a straight face: “One billion dollars.”
Hi. I’m Jeff Namnum, Partner at Touchlab.
After nearly a decade of building mobile apps across various platforms – Android, iOS, Windows (R.I.P.) – this is the single most common question I receive from clients, friends and family alike.
The simplicity of the question betrays the complexity of the answer.
PRICE VS. VALUE
“All you got your name and your word, so never break it | For this life, you pay a price, you get a chance you gotta take it.” – Whiz Khalifa
The debate regarding price (what you pay) vs. value (what you get) is older than dirt. Mobile apps aren’t immune from this discussion. Long ago, when mobile app development was nascent, and the skills necessary to just get an app out the door and into an app store were akin to voodoo, the price/value disparity was gigantic, and rightfully so. Basic economics tells us that scarcity drives prices upward, and in the early days, having an app that customers could download afforded bragging rights.
Today, in a world of nearly 5 million mobile apps across the major app stores, having a me-too app is no longer a means of advantage or differentiation. Independent of the growing ubiquity of mobile apps, one thing has remained constant at Touchlab:
Quality work product is defined as delivering value in excess of price.
THE SEVEN COST LEVERS FOR MOBILE APP DEVELOPMENT
“But don’t knock me for tryin’ to bury | Seven zeroes, over in Rio De Janiery” – Puff Daddy
In our quest to answer the cost question in good faith, we’ve determined 7 common pre-engagement cost levers business owners have that affect mobile app development:
Knowledge: We don’t know how to develop mobile apps
Complexity: We have a number of integrations between mobile apps and existing business platforms
Speed: We need our mobile app to be released sooner than our ability to learn to do so ourselves
Trust: We need to remove uncertainty from our ability to release mobile apps ourselves
Modernization: We have apps, but our requirements have outgrown our ability in terms of process and want to learn better practices
Innovation: We want to isolate new mobile app development and associated business models apart from our main business
Emergency: We have mobile apps live right now and something is going terribly wrong, we need it fixed yesterday
These 7 cost levers boil down to a singular concept:
COST IS A MATTER OF RISK MANAGEMENT
“Boy, check the resume, it’s risky in the A” – Big Boi
Each of the 7 categories constitutes a different level of pre-engagement risk for both the client/business owner and service provider (be it internal or external). To the extent that each side can mitigate risk factors, it can improve the price vs. value relationship. Two examples:
There’s a client who understands app development, and has already done an integration for say iOS into their existing platform but is seeking to build an Android port. Many different risk factors have been reduced. They’ve established integration points, APIs, and mobile UI/UX explorations to achieve some form of product-market fit with iOS, making the Android port straightforward.
Compare this to the client who may only have a desktop web app presence, not mobile responsive, and wishes to launch both an iOS and Android app simultaneously aligned with fast approaching, immutable marketing event date (store opening, movie debut, product launch, Super Bowl ad, etc.). We’ve now introduced a number of risk factors, and the value in partnering with a provider who can navigate them within the timeframe is high.
These levers explain some, not all, of the operating risk affecting price, mostly around determining work effort. The major remaining risk factor is determining the working relationship, or who is going to do what work?
Will it be a complete hand-off to the contractor, with minimal interaction with the client?
Will it be a joint effort among the client and contractor developers, product managers and designers
Will all production resources be in close proximity?
If the teams are remote, how distant are the timezones, are there any language barriers that might affect work cadence and velocity?
Are there any external operational factors that might mitigate cadence and velocity such as legal, regulatory or compliance?
LET’S BUILD YOUR BUSINESS TOGETHER
However helpful all of this is, none of this answers the original question of how much it costs to build a mobile app. We understand that “it depends,” though truthful, isn’t an acceptable answer.
Let me explain.
Just as your business is differentiated, and you treat your customers as individuals, we too don’t want to propose a prescriptive solution, ignoring what is specific about your innovation requirements. The above framework helps us quickly determine the pre-engagement factors related to your business needs and determine work effort, work attribution across the teams and only then, price.
If you’ve got a great idea for an app, and you want to partner with a team who can help make it into a sustainable business on time and on budget, do not hesitate to contact me. Again, my name is Jeff. I help build businesses.
Touchlab is an enterprise-grade innovation advisory firm helping application development leaders identify and eliminate inefficiency to free-up resources for reinvestment into innovation sprints.
What’s the difference between Touchlab and bigger enterprise mobile development firms like Accenture, IBM? Smaller players like WillowTree or LiquidHub?
IBM and Accenture aren’t known for building successful startup products. They specialize in selling big contracts to big companies. The output? Big applications we’ve all seen before. Not true mobile innovation. Furthermore, they don’t specialize in code-sharing, which is the only true path to accelerating mobile innovation. Touchlab has built disruptive products for enterprises and startups and is a pioneer in code-sharing for enterprise environments.
Smaller players like WillowTree and LiquidHub are capable of building great startup products, but they build product for 2010, not 2020. Our expertise in code-sharing and our D.R.Y. philosophy is a strategic advantage.
How are code-sharing and cross-platform development different?
Cross Platform is a “Capital B BIG Decision.” You have to live with that decision and it’s not an easy separation. Code-Sharing is lower risk because you can start small and there is no lock-in.
One day, will every enterprise mobile development team be using code-sharing?
Yes! Backend architecture and logic doesn’t need to be developed natively. We believe the trend towards enterprise code-sharing will start there and spread to other areas with potential for standardization.
Our August meetup was at none other than Meetup itself! We were welcomed at the door with lots of great meetup swag and then headed right to the food and drinks- Meetup sure knows how to host a meetup.
Kevin Galligan, organizer of the NY Android Developer meetup and president of Touchlab, shared the latest on Doppl code sharing and how he’s been using it to update the Droidcon app. You can view his slides here.
Next up was Priya from the Couchbase team (our August sponsor)! She spoke about the benefits of using NoSQL as an embedded database on mobile platforms. We even got a preview of Couchbase Lite 2.0! Check out her presentation.
Our next meetup won’t be until October- but we hope to see everyone at Droidcon this month. Get your tickets here.
Here at touchlab we could not agree more with Huyen and the many people on Twitter saying great things about this community. Droidcon NYC 2016 ended a few weeks ago, but it feels like yesterday and we already can’t wait for the next big community event.
Thank you to everyone. To the attendees who were kind enough to trust that we would do our best to make it valuable to you. To the speakers who are generous enough to come and share their knowledge and experience. To the sponsors who are forward thinking enough to invest in the community and earn their gratitude. We appreciate you all, thank for coming.
We were really grateful to hear all of your feedback afterward. You told us that Convene was the best venue yet, that the talks were stellar, and most importantly for us, you all had a great time. For many, it was a reunion of Android developers and designers scattered across the US and abroad, and we’re blessed to be able to bring you guys together every year.
Pictures of you doing things
Head to our Facebook page. Below are links to each of the albums to make your life super easy. Please tag yourself and people you know!
So, first things first. All the livestream videos are live right now on at droidcon.nyc for anyone with a ticket to the event. Just click through to the speakers page.
But of course, what you really want is the final, edited, free version that’s going to be up on Youtube. Well good news, those will be live by the middle of November!! Even better news, we’ve got a bunch live right now. Check them out here.
The final edited videos will be published in a few weeks on our touchlab YouTube channel, so subscribe if you want to get notified.
Let’s show some love for our amazing sponsors
These folks are the reason we could make this Android community conference happen. When it comes time to test out new tools or look for a new position or refer someone somewhere, please remember these great organizations and support them.
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