Quick reference: cost by project type
Here are realistic UK market ranges before we dig into what drives each number:
| Project type | Typical cost range | Timeline |
|---|---|---|
| Simple web app / internal tool | £8,000 – £20,000 | 6–10 weeks |
| SaaS MVP (core features only) | £20,000 – £50,000 | 10–16 weeks |
| E-commerce platform (custom) | £25,000 – £70,000 | 12–20 weeks |
| Enterprise software / large SaaS | £75,000 – £250,000+ | 4–12 months |
| Cross-platform mobile app | £35,000 – £90,000 | 14–20 weeks |
These are ballpark figures. The actual number for your project depends on scope, team composition, and approach. Keep reading for the full breakdown.
What drives the cost of custom software
1. Scope and complexity
Scope is the single biggest cost driver. A simple internal tool — CRUD operations, one user role, no integrations — might take 6–8 weeks. A SaaS product with multi-tenancy, subscription payments, role-based access, and email automation takes 14–20 weeks. More complexity equals more time, equals more cost.
Common scope traps founders fall into:
- "Simple" admin dashboards that have complex data relationships under the hood
- "Basic" integrations that require custom webhook infrastructure and error handling
- "Standard" authentication that actually needs SSO, 2FA, and invite flows
- "Just add a search bar" that requires full-text indexing and relevance tuning
2. Team composition and location
Where your development team is based is one of the most significant cost variables:
- UK-based agency: £600–£900/day per developer
- London agency: £750–£1,200/day per developer
- Eastern Europe / nearshore: £350–£550/day per developer
- South Asia / offshore: £150–£350/day per developer
The offshore team may take 20 weeks on what a UK team delivers in 12. Factor in your time cost, communication overhead, quality of output, and the risk of rework before optimising purely for day rate.
3. Fixed price vs time and materials
Most custom software projects are billed one of two ways:
Fixed price: You agree a scope, the agency quotes a price, and you pay that amount regardless of time taken. Works well for well-defined projects with low likelihood of scope change. Bad for exploratory or iterative builds.
Time and materials (T&M): You pay for hours worked. More flexible, better for projects where requirements evolve. You carry more cost risk. Good for ongoing development partnerships where scope changes weekly.
4. Discovery and design
Good agencies front-load 2–4 weeks into discovery — understanding your problem, defining scope, designing UX. Some agencies skip this to quote lower. You pay for it later in rework and delays.
Expect to pay £3,000–£8,000 for a proper discovery and UX design phase before a line of code is written. This is not an extra cost — it's the phase that stops the build from costing twice as much.
5. Third-party integrations
Every integration adds time. Here are realistic estimates:
- Stripe / payment processing: +1–2 weeks
- Twilio / SMS and email: +0.5–1 week
- CRM integrations (HubSpot, Salesforce): +2–4 weeks
- Identity providers (Auth0, Cognito, SSO): +1–3 weeks
- Accounting APIs (Xero, QuickBooks): +1–3 weeks
Integration work is never just an API call. Authentication flows, data mapping, edge case handling, and testing add up quickly.
6. Infrastructure and DevOps
Someone has to set up and manage your hosting infrastructure. For most SaaS products this means AWS, GCP, or Azure account setup, CI/CD pipelines, staging and production environments, database backups, and monitoring. This typically adds 2–4 weeks of initial setup, plus ongoing monthly infrastructure management costs.
Cost by project type
Simple web app or internal tool (£8,000–£20,000)
What this covers:
- Single-purpose tool (internal reporting dashboard, booking system, simple CRM replacement)
- 1–2 user roles, basic authentication
- 5–10 core functions
- No complex third-party integrations
- Responsive web design
This is the minimum viable budget for a professionally built custom tool. Below £8,000 you're buying someone's evening hours. Above £20,000 you're moving into MVP territory.
SaaS MVP (£20,000–£50,000)
What this covers:
- Core subscription product with 1–2 user roles
- User auth and account management
- 1–2 payment tiers via Stripe
- 3–5 core product features
- Admin dashboard
- Responsive web app (not native mobile)
- Basic email notifications
This is where most early-stage UK founders should focus their first build. Below £20,000 you're cutting corners that will hurt later. Above £50,000 on an MVP means you're building v2 scope into your v1.
The £20,000–35,000 sweet spot is where most well-scoped SaaS MVPs land. A tight discovery phase, a focused feature set, and a clear brief get you there. Most founders who overspend have either not done discovery properly or have kept adding features mid-build.
E-commerce platform (£25,000–£70,000)
What this covers:
- Custom product catalogue and search
- Basket, checkout, and payment processing
- Customer accounts and order history
- Admin inventory and order management
- Integrations (shipping APIs, payment gateway, email)
The range is wide because e-commerce complexity scales quickly. A straightforward product catalogue with Stripe is towards the low end. B2B pricing tiers, complex product variants, or marketplace features push towards £70,000+.
Enterprise software / large SaaS (£75,000–£250,000+)
What this covers:
- Multi-tenancy with organisation and team management
- Role-based access control (RBAC)
- Advanced reporting and analytics dashboards
- Complex workflow automation and approvals
- Multiple third-party integrations with real-time sync
- External API for third-party access
- High availability, performance, and uptime requirements
- Compliance features (GDPR, SOC 2, ISO 27001 readiness)
At this scale, most UK companies are better served by a dedicated embedded product team rather than a single project agency engagement. Consider whether a retained development team makes more sense than a fixed-scope build.
Cross-platform mobile app (£35,000–£90,000)
What this covers:
- iOS + Android via React Native or Flutter
- User auth and onboarding flow
- Core feature set (3–5 primary screens of functionality)
- Backend API
- App Store and Google Play submission
Native iOS + Android development with separate codebases roughly doubles cost. Most businesses don't need native. Cross-platform (React Native or Flutter) delivers 90% of the quality at 55–65% of the cost. If you're not sure you need a mobile app yet — build the web app first, validate it, then port to mobile.
Developer day rates in the UK in 2026
If you're comparing agencies or evaluating freelancers, these are realistic market rates:
| Role / location | Day rate |
|---|---|
| UK freelancer — junior (0–2 years) | £300 – £450/day |
| UK freelancer — mid-level (3–5 years) | £450 – £650/day |
| UK freelancer — senior (6+ years) | £650 – £950/day |
| UK boutique agency (5–15 people) | £500 – £800/day per dev |
| UK mid-size agency (15–50 people) | £700 – £1,000/day per dev |
| London large agency (100+ people) | £900 – £1,400/day per dev |
| Eastern Europe / nearshore — senior | £400 – £600/day |
| Offshore (India, Pakistan, Philippines) | £100 – £350/day |
These are blended rates that include project management, QA, and overhead — not just raw developer time. An agency quoting a project rate is baking all of this in.
Hidden costs founders miss
Post-launch maintenance
Bugs happen after launch. New features get requested. Dependencies become outdated and need security patches. Budget 10–20% of your initial development cost annually for ongoing maintenance. For a £40,000 build, that's £4,000–£8,000 per year minimum. Founders who don't budget for this end up with an unmaintained codebase within 18 months.
Infrastructure and hosting
A typical early-stage SaaS product on AWS costs £200–£500/month. As you scale users and data, costs grow. Factor this into your runway calculations from day one. At meaningful scale (10,000+ active users), infrastructure costs routinely exceed £2,000/month.
Security and compliance
If you're handling personal data (GDPR), taking payments (PCI-DSS), or working with NHS or healthcare data (NHS Digital standards), there are compliance costs you can't avoid. Penetration testing from a reputable firm runs £3,000–£8,000. Annual security audits add another £2,000–£5,000. Don't treat these as optional.
Third-party service subscriptions
Every service you integrate charges monthly fees that accumulate quickly:
- Stripe: 1.5% + 20p per transaction (European cards)
- SendGrid / Postmark: £15–£200/month depending on email volume
- Auth0: free up to 7,500 users, £200+/month beyond that
- Twilio: usage-based, typically £50–£300/month
- Error monitoring (Sentry): £20–£90/month
- Uptime monitoring: £20–£60/month
These add up to £300–£800/month for a typical early-stage SaaS product. Model them into your unit economics before launch, not after.
How to get an accurate quote
- Write a brief first. Describe the product, core features, target users, and what success looks like at three months post-launch. The more specific your brief, the more accurate the quote you'll receive.
- Ask for a discovery phase. Any reputable agency will want to do discovery before committing to a fixed price. Budget £2,000–£5,000 for this. It's the most important phase and will save money overall.
- Get at least three proposals. Compare scope definition, timeline, and approach — not just the bottom line. A low price on a vague scope is meaningless.
- Ask about assumptions. Every proposal contains assumptions. Surfacing them prevents scope change surprises mid-build.
- Request references. Ask for two or three references from similar projects in scale and type. Actually call them and ask about timeline accuracy and post-launch support.
Red flags in quotes to watch out for
Walk away if a quote:
Is custom software worth it?
Custom software makes financial sense when:
- Off-the-shelf tools require too many workarounds that create operational bottlenecks
- The software is the product — your competitive advantage depends on specific functionality
- ROI on automation or efficiency gains clearly justifies the upfront and ongoing cost
- You've validated the business model and need a production-grade system
Custom software is probably not the right move when:
- Airtable, Notion, or an existing SaaS product could solve the problem adequately
- You haven't validated whether the business model works yet (build an MVP, not a full product)
- You don't have the budget to maintain and evolve it post-launch
- Your internal team won't have capacity to manage the ongoing development relationship
The most expensive software mistake isn't building the wrong thing — it's building the right thing but not budgeting for what comes after launch. Plan for maintenance, infrastructure, and iteration from the start.
Summary
Custom software development in the UK in 2026 costs £8,000–£20,000 for simple tools, £20,000–£50,000 for a SaaS MVP, and £75,000+ for enterprise-grade systems. The biggest cost variables are scope, team location, and how well-defined your requirements are before development starts.
The best way to control cost is to invest in a proper discovery phase, be ruthless about MVP scope, and choose a partner whose process includes honest estimates — not just the number you want to hear.
