Introduction

“How much will it cost?” is usually the first question a business asks about a software project. It is also one of the hardest to answer in a single sentence. Unlike a printed brochure or a standard product, software is built to solve a particular problem, and its cost depends on what must be built, how quickly, and how much is likely to change along the way.

Because of this, software companies use different engagement models, the commercial arrangements that define how work is planned, priced, managed and paid for. The three most common are fixed-price projects, time-and-materials work organised in agile sprints, and dedicated teams. Each balances certainty, flexibility and control differently.

Choosing the right model is as important as choosing the right developer. A fixed price for a project full of unknowns can lead to disputes or a weaker result. Open-ended billing for a small, well-defined project can feel uncertain to a business owner. A dedicated team for a short job wastes money.

This article explains the three models offered by our team at Dsigngo Group and Raiden (Pvt) Ltd: Fixed Project, Agile Sprints and Dedicated Team. It covers how each works, what is included, its advantages and limitations, the factors that drive cost, and how to choose. It also explains what you should expect in any quotation, whichever model you choose.

The three models at a glance

Fixed Project

How it works

In a fixed-price project, the scope, deliverables, timeline and price are agreed before development starts. The scope is described in a detailed document based on discovery and design work: the features, user roles, screens, integrations, platforms and acceptance criteria.

The development team takes responsibility for delivering that scope for the agreed price. Payments are usually linked to milestones, such as approval of designs, delivery of a first working version, completion of user acceptance testing and launch.

What is included

Our Fixed Project model typically includes:

• A fixed scope document agreed with you.
• A fixed price and delivery date.
• UI/UX design, development and testing.
• Deployment and app store submission where relevant.
• Training and handover, including source code and documentation.
• 12 months of free support after launch, and free defect fixes with no time limit.

Advantages

• Budget certainty. You know the cost before work begins, which suits fixed budgets and approval processes.
• Clear expectations. Both sides know exactly what will be delivered.
• Less management effort. Once scope is agreed, you mainly review designs, milestones and testing.

Limitations

• Less flexibility. Changes after agreement must be estimated and approved as change requests, which can add time and cost.
• More upfront work. A reliable fixed price needs detailed requirements, which take time to prepare.
• Risk buffers. Developers include contingency for unknowns, so fixed prices can be higher than the same work done flexibly when things go smoothly.

Best for

Fixed projects suit well-understood needs: a company website with standard features, a focused app with clear requirements, an integration between two systems, or a first version of a product where the scope can be tightly defined.

Agile Sprints

How it works

In the Agile Sprints model, work is organised in short, fixed-length cycles, usually two weeks. Each sprint has a set team and a set price. At the start of each sprint, you and the team choose the highest-priority items from the product backlog. At the end, the team demonstrates working software, and you decide what comes next.

The overall plan, budget and target dates are still agreed at the start, based on an estimated number of sprints. But you can change priorities between sprints as you learn from users and the market.

What is included

Our Agile Sprints model typically includes:

• Two-week sprint cycles with planning and review meetings.
• Everything in the Fixed Project model: design, development, testing, deployment and handover.
• The freedom to change priorities each sprint.
• A sprint demonstration and review every two weeks.
• A shared backlog and product roadmap that you can see at any time.

Advantages

• Flexibility. You can respond to feedback, new ideas and changing business needs without formal change requests for every adjustment.
• Early value. The most important features are built first and can be released early.
• Visibility. You see real progress every two weeks and can stop, pause or redirect the project at sprint boundaries.
• Less upfront specification. Development can start once the first priorities are clear.

Limitations

• Less fixed total cost. The final cost depends on how many sprints are needed, which depends on decisions you make along the way.
• More involvement. You or your product owner must take part in sprint planning and reviews and make timely decisions.

Best for

Agile Sprints suit products that will evolve: customer apps, platforms, start-up products and business systems delivered in phases. They also suit projects where requirements are not yet fully known, or where users’ feedback should shape later features.

Dedicated Team

How it works

In the Dedicated Team model, you engage full-time team members, such as developers, testers, a designer and a project manager, who work only on your product for a monthly fee. The team works as an extension of your business, follows your priorities and builds deep knowledge of your systems.

The team size can increase or decrease with notice, as your needs change. You direct priorities, often through a product owner on your side, while we handle recruitment, management, equipment, workspace and quality.

What is included

Our Dedicated Team model typically includes:

• Full-time dedicated developers with the right skills for your technology.
• Everything in the Agile Sprints model.
• A project manager and quality assurance testing.
• A flexible team size, adjusted with agreed notice.
• Monthly reports and review meetings.

Advantages

• Continuity. The same people work on your product over time, building knowledge and speed.
• Control. You set priorities daily or weekly, much like an in-house team.
• Cost-effectiveness. For long-term work, a dedicated team in Sri Lanka can cost less than hiring and managing an equivalent in-house team, especially for businesses in the UAE and other higher-cost markets.
• Scalability. Add or reduce capacity without recruitment delays.

Limitations

• Ongoing commitment. The model is designed for months or years of work, not short projects.
• Management time. You need someone to set priorities and review work regularly.

Best for

Dedicated teams suit companies with continuous development needs: software products, large internal platforms, eCommerce businesses that release new features regularly, and businesses replacing several systems over time.

What drives the cost of software

Whichever model you choose, the same factors determine how much work is needed:

• Scope: number of features, screens, user roles and business rules.
• Complexity: calculations, workflows, approvals, real-time updates and offline working.
• Platforms: web, Android, iOS or all three; native or cross-platform.
• Design: standard components or highly customised design and animation.
• Integrations: payment gateways, accounting, SMS, courier, government or legacy systems.
• Data migration: volume and quality of existing data.
• Security and compliance: sensitive data, payments, audit and data protection requirements.
• Performance: expected numbers of users and transactions.
• Support: hosting, monitoring, updates and service levels after launch.

Reducing scope for the first release is usually the most effective way to control cost. Insights Article 1 explains the minimum viable product approach.

Costs beyond development

When budgeting, remember the costs that come with running software:

• Hosting and infrastructure: cloud servers, databases, storage and backups.
• Third-party services: SMS, email, maps, payment gateway fees and software licences.
• App store accounts: the Apple Developer Program has an annual fee, and Google Play has a one-time registration fee.
• Domain names and SSL certificates.
• Support and maintenance: monitoring, security updates, operating system updates and improvements.
• Marketing: promoting a new app or platform to reach users.

A good quotation shows these costs clearly, so there are no surprises later.

What a good quotation should include

Whichever company you work with, look for:

1. A clear description of the scope, assumptions and exclusions.
2. The engagement model and how changes are handled.
3. A breakdown of design, development, testing, project management and deployment.
4. Milestones, timelines and payment schedule.
5. Ownership of source code, designs and accounts.
6. Warranty period and what it covers.
7. Ongoing costs for hosting, licences and support.
8. Communication arrangements, such as meetings, reports and points of contact.

Be cautious of quotations that are much lower than others without explanation. They often leave out testing, project management, documentation or support, which are then added later or not done at all.

Ways to reduce cost without lowering quality

A limited budget does not have to mean poor software. These approaches reduce cost while protecting quality:

• Launch a smaller first version. Focus on the features that solve the main problem, and add the rest once the first version proves its value.
• Use proven components. Standard login, payment, notification and reporting components cost less than building everything from scratch.
• Choose cross-platform development. For most business apps, one Flutter or React Native codebase for Android and iOS costs considerably less than two native apps.
• Use ready-made services for standard functions. Accounting, email marketing and payroll are often better handled by existing products connected through integrations.
• Prepare content and data early. Delays in providing text, images, product lists and test data extend timelines and cost.
• Make decisions promptly. A named decision-maker who reviews and approves work quickly keeps the team productive.
• Invest in design before development. Testing prototypes prevents expensive rework later.

What we do not recommend is cutting testing, security or documentation. These savings are usually false, because problems found after launch cost far more to fix.

Comparing quotations fairly

If you receive quotations from several developers, compare them on the same basis. Check that each covers the same features, platforms, integrations and design level, and that each includes testing, project management, deployment, documentation, training and a warranty period. Ask how each company would handle changes, who would work on your project, and whether you will own the code and accounts.

It is also worth asking each company to explain its estimate for one or two features. Their answers show how well they understood your requirements. A higher quotation from a team that clearly understands your business may represent better value than a lower one based on guesswork.

Why discovery is worth paying for

Some clients ask why discovery and design should be paid for separately when they simply want a price for the whole project. The answer is that a reliable price depends on reliable information. Without discovery, every developer is guessing, and the lowest guess is often the one that has misunderstood the most.

A short, paid discovery phase produces a prioritised backlog, user journeys, a clickable prototype for key screens, a technical plan and a firm estimate. These outputs belong to you. You can use them with our team or, if you prefer, with another developer. In practice, discovery often saves more than it costs, because it removes unnecessary features and catches misunderstandings before development begins.

How to choose the right model

Ask yourself these questions:

• How clear is our scope? If very clear and stable, consider Fixed Project. If likely to change, consider Agile Sprints.
• How long will development continue? A few months suits Fixed Project or Agile Sprints. Continuous work over a year or more suits Dedicated Team.
• How involved can we be? Agile and dedicated models need regular involvement from a decision-maker.
• What does our budget process require? Organisations that need one approved figure may prefer a fixed price, perhaps for a first phase, followed by sprints.
• How important is speed to market? Agile Sprints allow early releases of the most valuable features.

Many clients combine models. A common pattern is a fixed-price discovery and design phase, which produces a clear plan and prototype, followed by Agile Sprints for development, and then a small dedicated team or support plan after launch.

Support plans after launch

All three models end with launch, but software needs care afterwards. We offer support plans that include monitoring, backups, security and platform updates, bug fixing and an allowance of hours for improvements, with defined response times. Raiden (Pvt) Ltd already provides annual maintenance contracts for IT infrastructure with defined response times, and software support follows the same principle of clear service levels.

Illustrative example

The following example is illustrative and does not describe a real client.

A UAE-based trading company with a back office in Sri Lanka wants a customer portal for wholesale buyers. The owner has a clear idea of the first version but expects to add features once customers start using it.

The project begins with a fixed-price discovery and design phase. At the end of this phase, the company has an approved prototype, a prioritised backlog and an estimate. Development then proceeds in Agile Sprints. After four sprints, the first version launches with ordering, invoices and delivery tracking. Customer feedback leads the company to prioritise a reorder feature and statement downloads in the following sprints. Once the portal becomes central to the business, the company moves to a small dedicated team of two developers and a tester, who continue improving the portal and connect it to the company’s warehouse system.

Frequently asked questions

Can we start with a fixed price and switch to sprints later?

Yes. Many clients fix the price of a first phase and continue in sprints once the product is live.

What happens if we need changes in a fixed-price project?

We estimate each change and agree its effect on cost and timeline with you before starting. Small changes can sometimes be exchanged for features of similar size.

How do you control cost in the Agile Sprints model?

The budget and number of sprints are agreed in advance. You see progress and spending every sprint and decide priorities, so the most valuable work is always done first.

Can a dedicated team work in our time zone?

Sri Lanka is one and a half hours ahead of the UAE, which makes daily collaboration easy. Working hours can be agreed for other regions.

Do you require a deposit?

Payment terms depend on the model and project size, and are set out in the quotation.

Conclusion

There is no single best way to buy software development. Fixed Project gives budget certainty for clear scopes. Agile Sprints give flexibility and early value for evolving products. Dedicated Teams give continuity and control for long-term development. Many successful projects combine them in stages.

The most important step is an honest conversation about your goals, scope, timeline and budget. From there, we recommend the model that gives you the best value and the least risk.

Want a clear plan and quotation for your project? Book a free consultation.

Get a Project Quote

Sources

• Scrum.org, What is a sprint: https://www.scrum.org/resources/what-is-a-sprint-in-scrum
• Apple Developer Program, membership details: https://developer.apple.com/programs/
• Google Play Console, registration: https://support.google.com/googleplay/android-developer/answer/6112435
• Raiden (Pvt) Ltd company profile and AMC booklet (support and service levels): https://www.raiden.lk