Product Development Cost in 2025: Breakdown, Key Factors & Cost-Saving Tips

ScaleupAlly | November 5, 2025 , 8 min read

Table Of Content

Forget everything you think you know about developing a complete product on your own using AI. You still need experienced developers building your product in 2025, and they don’t come cheap. However, with smart strategies, developing a product shouldn’t drain your entire budget.

How much does product development cost? The best answer is “it depends.” That’s just the way it is. Different factors influence the cost of product development. In this guide, we examine the factors that drive costs and provide guidance on how to save effectively while building your product.

Key Takeaways

Budget anywhere from $30,000 for a basic app to $500,000+ for complex platforms. What you build and who builds it determines the final price.
Most of your budget goes to development, but don’t skip research, design, or testing. Cutting corners will create problems later that may cost more money to resolve.
Offshore developers cost less than U.S.-based teams. Agencies are faster.
Start with an MVP and build lean by launching with core features, getting feedback, then adding more. Use existing tools instead of building everything from scratch.
Lock down requirements before you start coding. Save new ideas for version 2.

How Much Does it Cost to Develop a New Product?

How Much Does it Cost to Develop a New Product?
Factors Influencing Product Development Cost
Calculating the New Product Development Cost
How to Reduce Product Development Cost
Conclusion
Frequently Asked Questions

There’s no specific cost figure in product development. You could spend $20,000 or $1 million. Sometimes even more. For a clearer picture, a basic mobile app can $20,000 to $50,000 to develop. If we are talking about mid-level platforms too, it could cost at least $100,000. Enterprise software with advanced integrations can easily hit $500,000 or beyond.

Two major factors determine cost: complexity and development team. Other factors also include features, design depth, tech stack, team location, and timeline. A simple MVP costs less than a fully loaded product. Offshore developers charge different rates than U.S.-based teams. We look at these factors in detail later.

Stage-by-Stage Cost Breakdown of Product Development

Product development happens in phases. Each phase or stage comes with its own price tag. Here’s what it looks like:

Discovery and Research ($5,000 – $25,000): Even though you know what you want, a rough idea is not enough. Other activities need to take place to validate it, such as market research, competitor analysis, user interviews, etc.
Design ($10,000 – $80,000): Wireframes come first, then full UI/UX design. Designers take the ideas from your mind and transform them into visual concepts. This is to make sure that developers code what you have in mind. Good design costs more upfront but saves money later by reducing rework.
Development ($50,000 – $500,000+): This is the bulk of your product development cost. Frontend, backend, database architecture, API integrations all add up to the cost. A basic app with standard features sits at the lower end. Enterprise solutions with custom builds push well into six figures.
Testing and QA ($5,000 – $50,000): Bugs are expensive to fix after launch. So, it’s better to catch them early with proper quality assurance.
Launch and Deployment ($3,000 – $15,000): Server setup, app store submissions, final configurations. This is not the flashiest stage, but it’s essential.
Post-Launch Support ($2,000 – $20,000/month): This pays for maintenance, updates, bug fixes, and hosting fees. Your product needs ongoing attention to stay functional and secure.

Factors Influencing Product Development Cost

Not all products cost the same to build. A handful of factors determine whether you spend $30,000 or $300,000. Here are a few:

1. Product Complexity

A basic app with three features costs far less than a multi-platform system with dozens of integrations. It’s a simple logic. Every added feature or custom function makes the product development expensive.

2. Design Requirements

If you want a polished, branded experience with smooth animations and intuitive flows, expect to pay more for a designer to give you that. Off-the-shelf UI kits save money, but they look generic. A custom design is the way to go if you want to stand out.

3. Technology Stack

Some tools cost more than others. Native mobile apps (iOS and Android separately) run higher than cross-platform frameworks like React Native. If you want to incorporate emerging tech like AI or blockchain, you need to budget extra for specialized developers.

4. Team Location

Geography is a cost factor too. U.S. developers charge $100 to $200 per hour. Eastern European teams might ask $50 to $100. South Asian developers can go as low as $25 to $50. Lower rates don’t always mean lower quality.

5. Team Structure

Freelancers are cheap but inconsistent. Agencies cost more but deliver faster with full teams. In-house teams give you control but come with salaries, benefits, and overhead. Whatever your choice is, it will impact the overall cost.

6. Third-Party Integrations

Connecting to payment processors, CRMs, or analytics tools adds complexity. Some integrations are plug-and-play. Others require custom API work that inflates how much product development costs.

Calculating the New Product Development Cost

There’s no exact way to nail down the actual number. However, with a little bit of maths, you can get close.

Using the hourly rate, you can make some estimates. Using the formula below, estimate how long each piece will take, then multiply by your team’s hourly rate.

Total Cost = (Development Hours × Hourly Rate) + Design + Testing + Infrastructure

Break the project into chunks of hours it may take to complete each module. A login system might take 20 hours. A payment gateway could need 40, and so on. Using the formula, a mid-level app will need:

200 hours of development at $100/hour = $20,000
60 hours of design at $80/hour = $4,800
40 hours of testing at $60/hour = $2,400
Project management (15% of dev cost) = $3,000
Infrastructure and tools = $1,500

Total: $31,700

That’s a baseline. Unexpected technical challenges can push it higher.

How to Reduce Product Development Cost

There are ways to reduce the cost of product development without cutting corners. Here are a few examples

1. Start with an MVP

Build the bare minimum first by launching with core features only. Get feedback on that, then add more later. An MVP costs a fraction of a full-featured product and proves your concept before you pump in lots of resources into it.

2. Use Existing Tools and Frameworks

Don’t reinvent the wheel. There are pre-built libraries, open-source frameworks, and third-party APIs that could save months of development time. Stripe can be used for payments, Twilio for SMS, Firebase for backend infrastructure, and many more tools.

3. Go Cross-Platform

Building separate iOS and Android apps doubles your work. Frameworks like React Native or Flutter let you write once and deploy everywhere. You’ll cut development time nearly in half.

4. Outsource Smartly

Agencies in Eastern Europe or South Asia deliver solid work at 40-60% lower rates than U.S. teams. While time zones can complicate coordination, the savings often justify the effort for non-urgent projects.

5. Avoid Scope Creep

Every “quick addition” costs time and money. Lock down requirements before development starts. Save new ideas for version 2.0. Saying no to feature creep is one of the easiest ways to control product development cost.

6. Reuse and Repurpose

Already have design assets? Code from a previous project? Reuse them. Templates, components, and design systems cut hours off timelines.

Conclusion

Product development costs don’t have to be a mystery. When you understand the breakdown and know where to cut smartly, you stay in control of your budget.

Ready to build? We’ll help you map out the real cost of product development and find ways to save without compromising quality.

Frequently Asked Questions

Q: How much does it cost to develop a new product in 2025?

It depends on complexity. A basic app runs $30,000 to $80,000. Mid-level platforms cost $100,000 to $300,000. Enterprise software with advanced features can hit $500,000 or more. Your final product development cost comes down to features, team location, and timeline.

Q: How long does it take to develop a new product?

Simple apps take 3 to 4 months. More complex platforms need 6 to 12 months. Enterprise solutions can stretch beyond a year. Timeline depends on scope, team size, and how often requirements change.

Q: How can startups reduce product development costs?

Start with an MVP. Use existing frameworks and third-party tools instead of building from scratch, and hire offshore developers or go cross-platform to cut costs.