How we price our software
Models of cooperation
We work based on three cooperation models - Project Outsourcing, Team Extension and Dedicated development team / center. Cooperation model is selected based on the client’s needs and the nature of the specific project. It can also change during the lifecycle of the project, for example, a typical transition can be from quote based outsourcing to retainer based team extension as the mutual trust between client and vendor becomes more established. Cooperation model also determines pricing options and levels. Typically, larger team size and longer-term commitment allow for lower effective hourly pricing. The relationship between cooperation and pricing options can be summarized using the flowchart below.
Project Outsourcing is a cooperation model where we implement a project based on specifications provided by the client, and are responsible for ensuring successful delivery of the project. In this scenario day-to-day management of the project and selection of the dividual team members is the responsibility of the vendor. Project Outsourcing comes with two pricing models - Fixed price and T&M.
The Fixed Price model suits the client when the budget for the development of the entire project is approved before the start of work and remains unchanged. A contract with a fixed price is most often used for small projects with strictly limited functionality that does not provide much room for changes and edits. Because under such a model financial risks of underestimating and unforeseen complications are carried by the vendor, when preparing a fixed price estimate usually a certain risk margin is added.
Time & Material pricing model is used in cases where it is difficult to determine the exact cost of the finished product. Each project is usually divided into several separate tasks (including functionality, cases of use, tests, etc.) The project manager provides recommendations on task prioritization, the level of their complexity, the method of their implementation, and estimated cost.
Team extension model means that one or several of our specialists become a part of the client’s team. In this case, financial relationships can be either Time & Material (per specialist hourly billing) or Monthly retainer (full-time monthly billing). Time & Material rate may vary depending on the project length and specialists’ workload. Rates for long-term full-time or close to full time projects will be lower than the rate for short term projects or on demand resource access.
Because projects that we worked on over the years were often challenging and required a scientific approach, we always had high-level mathematicians and data scientists on the team.
The Dedicated Development team is a cooperation model that allows clients to assemble a team, or hire specific engineering talent. This type of contract is perfectly suited for long-term projects with undefined requirements, or large internal projects of the client’s company when there is not enough qualified staff on board or the cost of such talent at client’s location is too high. In such a relationship it is the client's responsibility to manage the team, while we are responsible for the administrative management and facilitation. Working on the basis of this cooperation model, we rely on Monthly retainer pricing than a client performs full-time monthly billing per specialist time.
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