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Incorrect estimation of the cost of IT contractor services

Hello everyone 👋🏼


Today we will talk about the incorrect assessment of the cost of developing IT solutions. This pain is one of the main ones for enterprises and startups, including IT contractors themselves.



Let's look at how, on average, the process of ordering outsourced development takes place:

1. There is a need to optimize something in business, or simply become more innovative, or create a business/new direction around an IT solution.

2. There is a brainstorm in individual departments or the whole company.

3. The idea of an IT solution is born: mobile application, website, integration, CRM, ERP, IoT solution.

4. A responsible employee is appointed, most often with low IT competencies. The elaboration of the idea begins. Even if the company has an IT department, it is far from a fact that it is competent in terms of pricing IT solutions. And this is absolutely normal.

5. An idea becomes a concept.

6. The search for a contractor begins.

7. Analysis of proposals.


That's where we'll stop.


One of the main problems of the employee responsible for the project is ignorance of the real cost of developing an IT solution. You need to understand that there are many factors in the formation of prices, not just the cost of a person-hour.


What can go wrong when you don't know the real cost of developing an IT solution:

1. You can get all the overpriced offers, even if you choose the cheapest one.

2. You can get an offer from a company that could not soberly assess the cost, dumped in pursuit of the project, and already in the process of implementation realized that it did not have enough resources.


In the first case, you will simply overpay and, far from the fact that you will receive high-quality services. In the second case, you risk not only losing money, but also not getting the product.


I have been engaged in commercial development of IT solutions for more than 10 years and have formed my own approach to pricing, which takes into account most of the nuances on the part of both the customer and the contractor.


If you need help in this matter, feel free to contact me 🙌🏼

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