Our Pricing Models for Software Development
ScienceSoft provides customers with the maximum cost predictability and offers flexible pricing models tailored to the software project’s scope. Depending on the required services and the chosen development methodology, we employ one of the following models or use them in combination:
- · Time and materials (T&M).
- · Time and materials (T&M) with a cap.
- · Fixed price.
- · Monthly subscription fees, per-ticket fees (for support and maintenance).
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Major Software Development Pricing Risks — and How We Avoid Them
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What might go wrong |
How it goes with ScienceSoft |
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Risk #1: Rate manipulation
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There is a dirty market practice of offering unrealistically low development rates to win a client. During the project, the vendor then claims growing complexity of tasks and escalates the rates, often leaving a client no choice but to pay more to not stall the progress. The case is especially true for complex projects where it’s hard for the client to switch the vendor midway. |
We accurately assess task complexity before the project start, pick the experts of adequate seniority to complete them, and say openly about the required investments. We fix the rates, rate-bound development estimates, and rate escalation clauses in the contract to legally protect our customers from unjustified price changes. |
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Risk #2: Rigid pricing models
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Despite the popularity of T&M, this model is not a “one-size-fits-all” option, and in some cases, a fixed price would be more favorable for the client. However, unscrupulous vendors may exploit T&M for larger financial gains. For example, a vendor may price the fixed-scope task under T&M and then attempt to increase the budget by intendedly delaying the deliverables and claiming more billable hours. |
With 3,600 successfully completed projects, we know the optimal pricing models for various development methodologies and tasks. Our experts pick the most feasible model taking into account the project scope and the client’s budget limitations. We never confine our clients to one option and can combine several pricing models to reduce development costs. Explore our featured success story to understand the value of ScienceSoft’s flexible approach. |
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Risk #3: Hidden fees
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Some vendors may deliberately give rates only for apparent development tasks and hide some integral project cost components so that their quote look more attractive. The vendor later claims that “extras” (for example, project management, testing, license and subscription fees for third-party tools) fall outside the agreed-upon scope, justifying additional charges. |
We sign a clear and detailed contract that covers project scope (with exclusions and possible extensions), administrative overheads, responsibilities for paying third-party fees, and provisions for potential changes. This way, the clients know the rationale behind the due payments and is protected from unexpected fees during the project, thus can accurately plan expenses. |
Software Development Pricing Models We Rely On
Time and materials (T&M) model
More than 90% of ScienceSoft’s development projects are priced under this model.
When and why:
ScienceSoft opts for this model when a project’s task scope is subject to change due to early user feedback, evolving customer requirements, or other factors. We bind the development cost to the agreed rates and the efforts our experts spend to introduce the deliverables, so the client only pays for the actual work done. Although it’s impossible to predict the exact scope of work early on, our mature project management practices help us accurately define the baseline scope and give realistic estimates from the start.
Best for:
- Agile software development – we charge for the efforts required to deliver individual software scope units (e.g., user stories) or functional points (e.g., screens, logical files).
- Iterative software evolution, reengineering, bug fixing.
- Continuous consulting during software implementation.
- Dynamic knowledge management activities (e.g., documenting software in parallel with development).
To safeguard the customer from unexpectedly high development expenses, we establish a cap — the maximum amount of hours ScienceSoft may charge for per iteration or task scope.
Fixed-price model
When and why:
ScienceSoft uses this model when a customer wants our team to handle a software project with a clearly defined scope or perform a development task can’t be divided into smaller time-framed portions. We estimate the final cost of our service in advance by determining the exact efforts necessary to complete the task.
Best for:
- One-time consulting services (architecture design, feasibility study, code audit, etc.).
- Proof of concept (PoC) development.
- Linear software development – we define the task scope and fix the price for each Waterfall stage (design, implementation, quality assurance, etc.). Although we prioritize Agile, the Waterfall methodology may be suitable for small low-risk initiatives and documentation-intensive software-hardware projects in regulated industries.
- Isolated development tasks with a defined scope (building a particular feature or software component, application migration to cloud, one-time security testing, etc.).
- Fixed-scope knowledge sharing activities (e.g., knowledge transfer sessions, user trainings).
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Subscription-based model
When and why:
Once the software is launched, ScienceSoft typically takes care for its ongoing maintenance and support. We calculate a flat monthly fee for our support services based on the agreed scope of work, which usually depends on the number of software users or support tickets. This model gives our customers maximum control over the service budget.
Best for:
- L1–L3 help desk (resolving a specific number of tickets per month).
- App infrastructure management (software configuration, cloud resource optimization, etc.).
- Managed security services (compliance monitoring, regular vulnerability scanning, etc.).
Some of our clients have greatly varying monthly volumes of help desk tickets. We price such companies under a per-ticket model, which implies charging based on the number of tickets processed and resolved within a specific period. This way, we help our clients avoid overpayment for unused help desk capacities.
Mixed model
When and why:
Fully outsourced software development usually involves multiple activities priced under different models. At ScienceSoft, we mix several approaches depending on the situation to ensure optimal service pricing and help our clients optimize project costs. For example, a client starts the software endeavor with a feasibility study and seeks assistance with technical design, hence charged a fixed price. Once the discovery is completed, the company wants us to take over product development — for that, we rely on the Agile methodology and apply the T&M model.
Best for:
- Large-scale, long-term development projects with undefined scope (e.g., digital transformation, R&D projects).
- Full-cycle software modernization projects combining versatile consulting and development services (system audit, redesign, cloud migration, building new features, etc.).
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Featured Project: Fixed Price + T&M
We particularly appreciate ScienceSoft’s flexible, client-oriented approach to cooperation and pricing, which helped us get the required scope of quality services on time and on budget.
Daniel Tacker, IT System Analyst at Cyber Graphics