If you’ve started getting quotes for a custom software project, you’ll have noticed the numbers are all over the place. The same brief can come back at £8,000 from one source and £85,000 from another. Both quotes might be honest. Neither is automatically wrong. The difference comes down to who’s building it, where they’re based, what they’re committing to, and which risks you’ll end up carrying yourself.
For most business owners, comparing headline figures is where the decision goes wrong. The numbers are pricing different things. What matters is which quote will deliver something you can actually use, on a reasonable timeline, without the costs running miles ahead of the original number.
Why quotes vary so wildly
The custom software market has effectively three layers, and the price differences between them are not subtle and the options present different risks.
Offshore freelancers and small agencies in lower-cost regions can quote a project at a fraction of UK rates. A build that a London firm prices at £45,000 might come back at £8,000 to £15,000 from a freelancer in South Asia or Eastern Europe. The hourly rates genuinely are lower, the cost of living is lower, and the work can be technically competent.
UK-based freelancers and small agencies typically sit in the middle. A solo UK developer charging £350 to £500 a day can deliver the same project for £20,000 to £35,000, depending on scope and how much oversight you’re willing to provide.
Established UK firms usually quote at the top of the range. The number covers developer time, but also project management, design, testing, ongoing communication, formal documentation, and the safety net of a real company that will still exist in three years if something needs fixing.
The reason for the spread isn’t that one party is greedy and another is generous. They’re pricing different things, with different levels of risk transferred to you.
What you save with offshore, and what you carry instead
Going offshore can genuinely save money upfront. Many UK businesses have had good experiences with offshore developers, particularly for well-defined, technically straightforward projects where requirements don’t change much.
The risks aren’t theoretical, though, and they tend to compound when projects get more complex.
Time-zone overlap matters more than people expect. A developer who answers messages five hours after you send them is fine for routine work and painful when you’re trying to clarify something that’s blocking the build.
Communication friction adds cost everywhere. Misunderstandings on requirements result in code that doesn’t quite match what you wanted, and the rework happens on your time and budget.
Quality varies enormously. Some offshore developers are brilliant. Others write code that runs but is hard to maintain, undocumented, or built on choices nobody can defend a year later when you need to extend the system. Knowing which is which is hard from a sales call.
Security issues. This tends to get the least attention at quote stage and cause the most problems later. Sending customer data, employee records, or anything covered by UK GDPR to a developer in a country without an adequacy agreement carries data protection obligations that smaller businesses often don’t realise they’re taking on.
Legal recourse is limited. If a project goes wrong with a UK supplier, you have UK contract law and small claims access. A dispute with a freelancer in another jurisdiction is much harder to resolve.
Aftercare frequently disappears. Offshore freelancers tend to move on once you’ve paid. Six months later, when you need a fix or a small change, the original developer may be unreachable, and another developer needs to learn the codebase from scratch (or worse, you discover the codebase isn’t documented enough for that to be feasible).
UK freelancers are a step up. You’ll get easier communication and clearer legal recourse. You may still hit problems with availability, holidays, illness, and the bus-factor of a one-person operation.
Why a London firm can still be the right call
There’s a perception that London-based development firms are all premium-priced. That used to be true. Increasingly it isn’t. Many London firms have some of the most qualified developers in the world and also offer services remotely.
Established London firms now offer fixed-price packages aimed specifically at SMEs, delivered in person for businesses nearby and remotely for clients across the rest of the UK. You get the proper UK contract, professional project management, formal scope documentation, and the safety net of an established business behind the build, but the day-to-day delivery happens over the same video calls and shared tools you’d be using with a freelancer.
For a sense of what realistic UK pricing looks like across project types, this breakdown of UK app development costs covers typical ranges by complexity level. If you’d rather work with a London-based custom software development firm that delivers fixed-price builds across the UK, that’s the model worth comparing offshore quotes against.
Fixed-price versus time and materials
Fixed-price quotes change the conversation in your favour. A T&M (time and materials) arrangement puts the cost risk on you. The hours go up, your bill goes up, and there’s no upper bound. A properly scoped fixed-price quote puts the risk on the supplier. They’ve taken the time to understand the project, they’ve priced it carefully, and if it overruns on their end, that’s their problem.
Fixed-price only works if there’s proper discovery first. Anyone who quotes you a fixed number after a 30-minute call without seeing detailed requirements is either guessing or planning to charge you for change requests later.
What’s too cheap, and what that tells you
The quotes that should give you pause aren’t the expensive ones. They’re the suspiciously low ones.
If three suppliers come back at £30,000 to £50,000 and a fourth quotes £6,000 for the same brief, the fourth isn’t a bargain. They’re either misunderstanding the scope (in which case you get something that doesn’t match what you needed), cutting corners on testing and documentation (so you inherit a fragile system), or using the low number as a foot in the door before adding extras (and the final cost ends up nowhere near £6,000 anyway).
Low quotes typically come with hidden costs further down the line. The next developer has to reverse-engineer an undocumented codebase. Bugs surface in production because testing was happy-path only. You end up doing the project management yourself because there wasn’t budget for it. Infrastructure work was skipped and someone else has to fix it.
Custom software has a real cost to deliver properly. Anyone undercutting that cost dramatically has cut something out, and it’s almost always something you’ll need later.
How to actually compare quotes
Forget the headline number for a moment. Compare what’s included.
What does the quote actually cover? Discovery and proper requirements work, or just a 30-minute call? Design, or whatever the developer decides looks fine? Testing, or only happy-path checks? Documentation, technical and user-facing? A post-launch support period, or are you on your own from day one? What’s the change-request process and rate? Who owns the code at the end, you or the developer? And what happens if the supplier disappears halfway through the build?
A £45,000 quote that includes all of the above is genuinely cheaper over five years than a £15,000 quote that includes none of it.
A reasonable rule of thumb
For most UK SME custom software projects, the realistic ranges look something like this. Simple internal tools or workflow automation: £8,000 to £25,000. Proper business applications with multiple user roles, integrations, and a polished interface: £25,000 to £80,000. Complex multi-tenant platforms or systems with heavy data or AI integration: £80,000 upwards.
Quotes well below those ranges deserve careful questioning. The quote worth picking is the one where you can see what you’re paying for, the supplier has skin in the game, and there’ll still be someone to call in two years when you need a small change. Pick from the quotes that meet those tests, and the cost question tends to resolve itself.
