How to Choose a Software Development Company That Is the Best for Your Project

Software development is tough work, but it’s even harder when you end up outsourcing software development to an inefficient or unproductive software development company. Think of all the time you will lose and the resources that will be wasted.

While there are several software development companies out there, not every one of them will be a good fit for your development project and business processes. Custom software development firms often have different areas of expertise, so it’s important that you find one that has experience in what you need.

So, how can you tell if a company will deliver high-quality work within your project timeline and budget? This guide provides an overview of how to choose a software development company that’s best for your project, as well as the red flags to watch out for and avoid.

Factors to Consider Before Picking a Software Development Company

Before you begin your search for a custom software development company, you should do some homework yourself. This foundation will be your guiding beacon when you eventually start narrowing down your options. Here are some basic factors to consider before you start choosing a software development company.

#1 Specify Your Goals

The first step to finding a software development company that can help you grow your business is identifying the type of software you need and working out the goals of your project. This makes it more likely to find a company whose capabilities align with the goal of your software development project. This will increase the chances of ending up with a favorable outcome.

#2 Determine Your Technical Needs

While it’s good to have an initial understanding of your technical needs, you don’t need to finalize the entire tech stack yourself. Focus on defining the problem you want to solve and the goals you want to achieve. A skilled software development partner will act as a consultant, helping you choose the best platform, programming languages, and architecture for your project’s long-term success.

#3 Work Out a Rough Budget Estimate

Although the final budget depends on the software development company you end up hiring, it helps if you have a rough idea of how much you will need for your project. You can determine this by researching the cost of similar projects, although software development companies charge different rates based on their experience and location. You should decide how much work you need done before contacting a software development company. When you know the scope of your software project, you will have an easier time finding a suitable custom software development company.

#4 Research the Type of Software Development Services You Need

If you are looking for a software development company, you must determine what your needs are. Do you just need a simple website? Do you have a sportsbook app that needs development? Would you like them to build MVP of your mobile application? This will narrow down your search for custom software development services. 

#5 Set Up KPIs

It is critical to establish Key Performance Indicators to define what success looks like for your project. Preparing a project roadmap with clear goals for each phase is an excellent way to communicate your expectations and ensure you and the development firm are aligned on the project’s objectives from the start.

Step-by-Step Guide on How to Choose the Best Software Development Company

With the preparation steps highlighted above done, you should have enough to start your search for the right software development company for your project. This will involve meticulously researching your options to find the perfect fit for your project. Below is a step-by-step guide you can follow to get this done.

• Receive bids or offers
• Consider the company’s size and past experience
• Consider the company’s approach and philosophy
• Look into the reputation of the software development company
• Check what project methodology they follow
• Assess cultural fit
• Verify the company’s rates and fees
• Check location and time zone
• Compare a few software development companies
• Assess the company’s skillset
• Evaluate industry experience

#1 Receive Bids or Offers

Start by contacting potential software development companies and informing them of the details of your project. This can give you further direction to refine your project requirements even further while you come up with a list of potential candidates. It’s even possible to ask more than one software company to submit a proposal and compare rates. Once you’ve received bids from software development companies, you can decide which one best meets your needs.

#2 Evaluate the Company’s Size and Past Experience

The software development industry is similar to other fields of business in that small companies can be just as effective and produce just as high-quality results. Nevertheless, some projects might require more resources than a smaller company will simply be incapable of handling. This is why you should consider the number and type of employees the company has, especially if your project is a complex one.

In addition to having the specific skills required for your projects, bigger companies with years of experience are also likely to have handled projects similar to yours at some point. Consider their past experience. How long have they been in business? View examples of their previous work that are similar to what you need.

#3 Consider the Software Development Company’s Approach and Philosophy

Dig deeper into the company’s development process or approach to handling projects. How do they handle scope creep or unexpected changes in design? Do their responses seem reasonable, professional, and thoughtful? What modern communication tools do they use?

Also, consider how much communication will be involved in this project. For complex software system projects that will likely require a lot of back and forth, it is best to work with a responsive company that espouses clear communication so you always know what is going on. This will improve efficiency while giving you peace of mind for the entire project.

#4 Look Into the Reputation of the Software Development Company

It is also worth looking into how long they have been doing software and the success stories recorded so far. Note that a proven track record is not always a certain indication of the project’s success or otherwise. Many small businesses or new companies can excel at different projects, even more than older or more established ones.

However, if the project development company has been in business for some time, it should have a good reputation in the software industry. You can check out review websites like Google Business Reviews to get a sense of how previous customers feel about a software company and its development process.

For reviews of custom software development companies, Clutch may be a better resource, though. Check our profile on Clutch!

#5 Check What Project Methodology They Follow

The Waterfall development methodology may be a better choice for projects with well-defined requirements and minimal changes. If scope creep, uncertain requirements for product design, or shifting business goals are expected, you may want to choose a company that follows the Agile methodology with iterative cycles for deliverables. Agile methods allow developers to move quickly when they are productive, but still recognize when they are not. 

The software development team is also able to focus on delivering valuable software with minimal waste. Additionally, the Agile methodology allows for changes and refinements throughout the software development process rather than waiting till the release date is close before making changes. Through effective change management and active stakeholder involvement, good requirements can be turned into great products.

In general, web software engineering companies that employ quality assurance and offer a wide array of services are more expensive, but if you have a big project, they may be worth it.

#6 Assess Cultural Fit

Because you will likely be working closely together, it is important to find a software company that fits your needs from a business and cultural perspective. Note that culture is a lot more than just work hours, dress code, and language on the job. Culture embodies the company’s values and priorities in an uncertain world.

This needs to be balanced by your own values and what you want for your project. If you don’t share the company’s beliefs on key issues such as work-life balance or diversity on teams, then it might not be a culture that fits your goals.

#7 Consider the Software Development Company’s Rates and Fees

In general, software development projects cost more than projects in other industries, but that doesn’t mean they should be prohibitively expensive. Since software development companies typically charge per hour or per day, it’s important to take into account the number of hours (or days) it will take to complete a project.

A software development company should clearly explain its billing policies, which should include how you’ll be charged for changes, downtime, or other issues out of your control. Meetings with customers can cause costs to increase significantly, so determine how much time they expect to devote to you each day. Nevertheless, if the project is well run, daily meetings may not be necessary.

#8 Check Location and Time Zone

Consider the availability and geographical location of the software development company when making your decision. This is important, especially if you’re working with a foreign-based company.

Considering the time zone may reduce the additional costs associated with translation services or overtime. But hiring internationally has its perks, too. You can gain access to a wider talent pool, better skills, and better overall service quality by outsourcing your project to a foreign software development company. Needless to say, it can be cheaper as well. Understanding what is IT outsourcing is key here—it refers to the practice of hiring external service providers to handle IT-related functions, such as software development, infrastructure management, or support, allowing businesses to focus on core activities while leveraging specialized expertise.

#9 Compare a Few Software Development Companies

Don’t get swayed by bells and whistles when comparing software development companies. There are a lot of “extras” that companies may try to throw in, but those shouldn’t sway your decision. Stick to what’s important, which is quality and price. Based on the offers you have, you can compare your options based on their core services to see which ones work best for you. Only after evaluating their core values should you start comparing the extra features or benefits they offer.

#10 Assess the Company’s Skillset

Often, software development companies have a multi-skilled team with specific software developers who possess the specific technical expertise required for the project. Working with such a multi-disciplinary team is always going to be an advantage. Asking about previous successful projects is one way to check the skill set available within a company.

#11 Evaluate Industry Experience

Make sure the software development company you hire understands your industry and has experience with your type of application or website, as they should not have to spend much time learning about your organization, product design, services, etc., before starting the project.

Companies that specialize in specific industries usually have a better understanding of the software development needs of organizations in those fields. If your company operates within different industries, it may be harder to find software development companies that can handle all aspects of your project.

For this reason, you might consider partnering with a software development company that has developed software projects for a variety of organizations and industries to ensure they have the expertise to turn your software idea into reality.

Red Flags in Choosing the Right Software Development Company

One approach for choosing a suitable software development partner for your project is to narrow your options based on what the company has to offer, as highlighted above. An alternative approach is to focus on what’s missing or potential signs of trouble. Some of the red flags that may indicate that you should avoid a company are highlighted below.

Overtly Cheap Quote

Although cost-effective services are always a welcome idea, they should never be at the expense of your project’s quality. A software development company whose quote is a lot less than other service providers or the industry average will likely do a shoddy job.

Vague Portfolio Descriptions

A look through the software development company’s portfolio should give you a clear picture of their skills and experience based on how well they did on past projects. If the portfolio is vague or suspicious, you should be careful with that company.

Generic Testimonials

It isn’t uncommon for companies to cook up testimonials on their website or app to convince you. This is why doing due diligence with third-party testimonials is always better. Note that good testimonials on the company website or third-party sites may not always translate into great service.

Bad Reviews

Bad reviews from previous clients, especially when they appear genuine, are an obvious sign of danger. Although having one or two bad reviews is inevitable, too many bad reviews are a red flag. You should also watch the pattern of complaints. If several people are complaining about the same thing, it will likely be the same for you, too.

Not Interested in Signing an Agreement

Refusing to sign important agreements before your project begins is a major red flag. In addition to the main contracts, other agreements like the non-disclosure agreement and non-compete clauses protect sensitive information and safeguard your business. Potential vendors should be willing to sign agreements like these before the project begins.

Checklist: Questions You Should Ask Your Software Development Company

Before you sign on the dotted lines, there are questions you should ask your custom software development company. As a way to make things easier for you, we’ve prepared a list of questions that you may want to ask any software development company you’re interested in collaborating with.

• Question 1: “What does your design process look like?”

The design process should be clearly defined. It is important to ask the software development company about their approach and any specific specifications or tools that you need.

• Question 2: “What are your primary programming languages?”

Choose software development companies that use the language (or languages) your project requires. You should be able to review examples of previous work done by the company so that you can determine whether they meet your needs.

• Question 3: “What is the size of your development team?”

The perfect answer depends on the product you’re building. For small apps, fewer developers can be more efficient. For complex projects, a team of seven to nine people is recommended, each focused on design/UX, development, or quality assurance.

Project managers, product managers, and specialized software engineers help keep work focused and avoid overlap (e.g., branding by one person, marketing assets by another, UX research separate from coding).

• Question 4: “How does your payment structure work?”

A software development company should be able to explain its payment structure so that there are no surprises later. Some companies charge by the project, while others charge by hour/day.

• Question 5: “What is your software development process?”

Software development companies have processes to manage projects and workflows. They should clearly explain how they handle software development projects, including the tasks involved and estimated timelines, such as for healthcare mobile app development or custom software solutions.

• Question 6: “Do you have any references I can contact?”

Finding out more about a software development company’s work and experience is easy by asking for references. Be sure to request them to assess their expertise and past successes, such as with iOS mobile app development.

• Question 7: “What types of projects have you worked on in the past?”

Find out about the software development projects a company has completed to gauge its expertise.

Ask for details on similar past projects or contact previous clients to decide if the company fits your needs. They don’t need to share intellectual property or exact client details—just general insights and key takeaways.

• Question 8: “How will we communicate?”

Before beginning work on a software development project, companies may require a deposit. If you’re unsure about the contract terms, seek legal advice. A software development company should provide clear information about their terms and conditions.

• Question 9: “What software development tools do you use?”

It can sometimes be tricky to reach software development companies by phone, so having this process sorted out is essential. A software development company should be able to explain what type of communication they prefer and what hours are convenient for their availability.

• Question 10: “When can I expect to see the project’s progress, and how will it be delivered to me?”

Various software development companies will have a wide assortment of software tools – inquire about the software development company’s preferred method of working. Also, software development companies should be able to provide you with some insight into their experience with specific software and explain which ones they are most comfortable using for your project.

• Question 11: “What is your cancellation policy if we decide not to continue our business relationship?”

Knowing when you can expect work on your software development project and how it will be delivered is essential. The software development company should clearly explain its process, including task order, milestones, and the duration of each stage.

• Question 12: “What are your payment terms?”

It is important to understand the software development cancellation policy before signing any contract. If you’re unsure about any agreements, consult a lawyer and always ask the company for clarification if terms change. Keep in mind, you might still be responsible for costs even if the development team doesn’t deliver a viable product.

• Question 13: “What are the costs associated with the development of custom software?”

Sometimes, software solutions are complex, requiring a sufficiently large and experienced team to deliver quality results promptly. Choosing a software development company with the right team size can save you time, money, and hassle. A reputable company will clearly explain its team structure and expertise.

• Question 14: “What kind of support do you offer?”

Different software development companies have varying credit policies and custom software development pricing. Check their preferred payment methods, such as deposits or monthly payments, and understand the terms for your software development team.

• Question 15: “Can I see examples of previous projects that you’ve completed for other clients?”

A software development company should provide a clear cost estimate based on software type, technical expertise, quality control, and technology stack. They must be transparent about costs and promptly inform you of any changes.

• Question 16: “How will my project be managed after it’s finished, and who will take care of any updates or changes?”

Software development companies often offer support services, especially for projects needing long-term maintenance. They can provide insights into their development process and assist during and after the software development phase. For example, you can clarify if they’ll be available for real-time communication or contribute to your strategic roadmap once your ideas are realized.

Conclusion

Finding an ideal partner for your project can be tricky. In addition to specific considerations regarding the project, you also have to thoroughly research the company itself. However, evaluating your options based on the checklists above can help you narrow them down to the most suitable one.

A software development company like CrustLab will likely tick all of these boxes and more. We combine technical excellence with cost-effective solutions, offering global clients access to top-tier developers and proven project delivery standards across industries like iGaming, FinTech, Sports, and Gaming.

Our team includes passionate professionals and seasoned experts who can help you bring your software ideas to life. Contact us today to learn more about our software development service and see if it is a good fit for your project.