SaaS (Software as a service) is becoming a game-changer in every industry. Cloud computing has modernized the IT industry, enabling businesses to get the most out of their services. All thanks to SaaS. Due to the advantages, many wonder what it would cost to build a SaaS product. That’s what we’re going to look at here.
What is SaaS? Before we get into the cost of a SaaS product, let’s first clarify what SaaS is. We’ll borrow the words of tech giant Microsoft, who defines it as SaaS a hosted software model. It’s an application that offers real-time or on-demand access over the internet. You do not need to take the software and install it locally.
How much does it cost to build a SaaS product? While we focus on the cost of SaaS development, you can check the article by the link. It gives detailed insights into what this whole procedure has to offer.
Currently, SaaS development is valued at a whopping 482 billion dollars (According To Statista). Due to state-of-the-art features like complete customization, SaaS is gaining tracked attention. Also, SaaS products have witnessed a massive spike due to Covid-19. The pandemic opened up new opportunities, allowing companies to interact with their potential customers in a new way.
Startups looking forward to targeting their customer base using SaaS products have to understand the costs involved. What factors affect those costs? And how much does it costs to build a SaaS platform? Let’s move forward.
Nuances that can Affect SaaS product development costs
Cost is critical in developing software as a service (SaaS) products. Many factors can affect the development cost, so it is essential to understand all the parameters involved. Otherwise, you could end up spending more than necessary. Here are some things to remember when budgeting for your SaaS product.
The project itself
Your project is the ultimate factor that plays a vital role in defining the cost of SaaS software development. For instance, the design, the working, type of product, complexity, and features that differentiate your product from the ones available in the market- such factors and more reflect the cost of building a SaaS marketplace. These costs are considered unpleasant because you cannot compromise on this.
- The ultimate cornerstone of your project is the design itself, which can put a colossal change in budgeting. All features you are trying to implement will require a constant number of hours. That takes effort. No one is saying that you should splurge on these design parameters. Also, take the features that you want to implement in your product. The actions that your SaaS software will perform also reflect the price. The more features, the more the cost.
- Prices related to SaaS platform development also depend on whether they are scalable. Most SaaS apps are scalable, meaning businesses can get more features and tools as this software grows over time.
The team you are hiring.
The team you are hiring for your project also influences the costs related to SaaS product development. A team is the one that develops that SaaS product for you. And, that team can either be of 2 members or 40. It depends on the scale of your project.
But big teams don’t mean significant payments. You will have to pay a little more for every coder you bring on board. The real question is, how much will you pay for these? That is where the skills, experience, and location comes in.
If you are hiring a developer who knows skills like how to integrate APIs, design a flutter app, and use SQL at the backend, you will pay more. Similarly, if you want a senior SaaS developer, you must assign a considerable budget to that. Lastly, the principal devil that plays an important role is the developer’s location. Countries like the USA can cost you a developer about 115,000 on average. At the same time, a developer from Ukraine requests around $80,000.
Deadlines and Project Completion workflow
There is another factor that affects the cost of SaaS development. And that factor is how fast you want it. The number of hours put into the SaaS development defines its costs. There is another cost related to this, and that is QA testing/bug fixing. See, faster deployment can cause more bugs. To remove such bugs/errors, you have to hire a QA team. Yes, that is another cost.
Cost of building a SaaS Product- What is Involved
Now that we know what types of strings can affect the cost of building a SaaS product let’s talk about how much it can cost to develop such a platform. Honestly, the figures mentioned below don’t reflect the exact costs because these costs vary from project to project. But here is the overview.
The cost to develop a SaaS web platform mainly consists of the salaries given to the developer. According to Clutch, you can hire a SaaS platform developer for about $100-$150 per hour in the USA.
However, in Germany, that figure is slightly in the budget. The maximum rate per hour that a developer will get is $100/hour. Even though this is in the budget, it is still slightly high because there are fewer developers in that area.
The cost of developing SaaS software in Eastern Europe is the perfect solution. Counties like Ukraine are emerging with a skilled workforce that is available at an optimum rate of $50/hour.
Next on the line is the development costs related to your project. Mainly, we divide these costs into these:
- Market Research
- Creating MVP
- Development process
Market research is one of these critical parameters that, if not taken care of, can lead to more significant consequences like no sales. So, it is crucial. You can either do the market research on your own or hire an outsourcing firm to do this for you. The firm will charge about $60-$70 per hour on average for this.
After the market research, it is time to introduce your customers to your product. That is called MVP (Minimum Viable Product). Creating an MVP can cost you about $8000-$9,000.
Once you know what your customers are asking, you can move toward the SaaS product development process. Developing a SaaS product can cost you as far as $30,000. This includes the pay of developers, the infrastructure, and the tools required.
The cost of building a SaaS product varies depending on your target market, design, features, and advertising strategy. However, we can conclude that a good SaaS product will cost you about $55,000 to $60,000. After that, there is just maintaining and upgrading the software. Remember that the cost of building a SaaS product also depends on your target market, design, features, and advertising strategy. So make sure you have a well-thought-out plan before investing any money into this project.