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One of the most lucrative business ideas today is developing a SaaS product that is highly scalable and doesn't require any hardware investments. However, building a good SaaS product around a sound idea may cost you more.

Let's find out how much you will need to enter the SaaS product development market.

Gartner forecasted a 16.8% growth in the SaaS market in 2023 globally due to staffing challenges and the focus on security compared to 2020.

Not more than five or ten years ago, the demand for SaaS products and services was relatively less. However, they are gaining more popularity today, and businesses are likely to invest in SaaS applications

Now the question arises, how much does it cost to develop a SaaS product?

If you decide to follow the latest trends and invest in SaaS products, this blog post will help you.



The Stages Of SaaS Application Development And Their Costs

Building a SaaS product may look complex and intimidating, but it's only sometimes the case.

Let's look at how to create a SaaS in just four primary stages.

  • Formation Of Ideas And Market Research

The cost will be zero if you do the market research independently. However, hiring a market analyst may cost you £60 in the UK( it may be £35 if you outsource your SaaS development.) Therefore, in a week, the charge of the analyst will be £1400 to £3000, but the actual charge may depend on the time the experts take.

First, identify a market opportunity to help your audience satisfy your SaaS product. The SaaS Product you develop must solve a real problem, and your future product must appeal to a large audience, and they are likely to pay it through subscriptions. Thus, market research and surveys will enable you to understand the following:

The current demand for the SaaS product

  • Get better insights about your competitors and the requirements of your potential customers.
Come up with an idea that will set apart your SaaS product
  • Help you avoid mistakes led by your competitors
  • Implement affordable pricing for your product

Thus, conducting thorough market research will also help you look for disadvantages and gaps your SaaS product may fill. It is better to start preparing your monetisation and marketing strategy ahead of time to win over dissatisfied customers and attract new ones.


  • Product Discovery And Planning

Product discovery and planning take one to three weeks. Working 40-120 hours a week, the development will cost you around £1600 - £4800 for £40/ hour. In this stage, you develop the MVP (Minimum viable product) that includes a few key components your SaaS product will have. The benefit of this approach is that it enables you to market your product in a shorter time, get your potential customers' feedback, and ability to test your idea. 

You can develop one tool or service on your SaaS product, make adjustments, introduce advanced features, and eventually build a full-fledged SaaS product.

Hiring a SaaS development company or developers will be helpful at this stage. You can make better decisions, eliminating unnecessary features while choosing the best technology and tools to build your MVP. It will be easier to estimate the complete project, compare the product with your competitors, and plan the further development process.

  • Design, Development, Testing, And Debugging

If the basic designing of your SaaS product is done in the initial stage then a team of two developers can roll out the MVP in two or three months. Taking the same hourly rate of £35-£40, the basic calculation will leave you a minimum cost of £2500-£34000. 

You also need UX/UI experts at this stage for a simple and user-friendly SaaS product. An excellent UX/UI will facilitate extended and better use of your SaaS product.

SaaS solutions are developed using different frameworks, tools, and libraries. From the implementation standpoint, you may hire a third-party solution provider for your SaaS components. These managed service providers for SaaS applications also help you to host and maintain your product throughout the lifecycle. 

Also, outsourcing your SaaS product will enable you to build a scalable product, as these SaaS service providers work with a specific programming language and tools. They also can reduce the number of servers to the required minimum almost instantly- helping you save resources and money. 

Working with an extended and dedicated product team of SaaS developers will help you make better decisions and potential profits and estimate the cost of building your product. Your team will help prepare the documentation, reach the agreements, and ensure that your subscription covers the backup and recovery strategies.


  • Launch Maintenance And Improvements

The cost of maintenance and improvements by a couple of developers, designers, and QA specialists will be £10K per month. Hosting the SaaS platform may range from £1K to £10k.

All the deployed operations should correspond to the project specifications, SLA, security, and other regulations. It is essential to activate marketing and sales activities to accompany the launch of your SaaS product. 

The first few months will be crucial as you need to run testing, fix issues, track metrics, collect customer feedback, and rapidly implement changes. Also, monitoring the customers' behaviour and revenue will enable you to adjust the chosen SaaS model to achieve profitability.

Keeping your product updated, refreshed, and optimised with no downtime is vital to ensure uninterrupted availability and prevent situations where a part of the user base uses an outdated version.

Read Also: Why B2B Companies should take the Mobile route

Hiring Remote Developers For Your SaaS Development

Hire remote developers from India

A Few Other SaaS Development Costs

Finally, it is time that determines the cost of developing a SaaS product and the developer's hourly rate. The basic formula to calculate the cost of your SaaS product will be as follows:

Total cost to build SaaS product = Hours spent to build product x cost per hour.

Three essential factors impact the two variables.

  • Type, Complexity, and scope of the SaaS products

Any additional functionality, requirements, and third-party integration require research and coding effort that adds hours to your project and pounds to your bill. 

Your SaaS product's Complexity, deadlines, and other factors also suggest the number of developers required to develop your product. At different levels of development, you may include:

  • Business Analyst
  • Product Manager
  • Project Manager
  • Cloud Architect
  • UX/UI designer
  • Front-end Developer
  • Back-end Developer
  • Mobile Developer
  • QA
  • DevOps Engineer

—-------- also marketing, legal, and finance experts.

  • Qualification, Size, And Location Of Your SaaS Team

The number and the technical skill of the developers working on your project also impact your SaaS product development cost. The more skilled developers will do more work during the same period. Hiring qualified developers will enable them to develop a more robust product within a limited time frame. The experience of the developers will also accelerate the building of the SaaS application.

Also, senior developers' hourly rates may be higher than junior developers, and the more people in your team, the bigger your payroll.

The SaaS product development team's geographical location also impacts the cost of building a SaaS app. The wages of programmers in India may be ten times lower than in the UK.

Your company may form an in-house team, hire remote developers or join hands with a SaaS product development company for full or partial product development. The decision will directly determine the costs of building your SaaS product.


  • Post-Release Expenses

Your expense for SaaS product development doesn't end here. After post-release, there are a few expenses- improving your SaaS product, hosting services, maintaining servers, database and integrations.

TCO, or the total cost of ownership, is calculated based on updates, licensing, technical support, subscription costs, and more. Additionally, many startups and businesses are prone to making mistakes that can make SaaS costs skyrocket. Avoiding the common mistakes will help you avoid scope creep, wasting the budget, and eventual money loss due to failures.

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SaaS Product Development Cost Based On Hiring Resources

SaaS product development requires a pool of talented professionals to build a top-notch product. Your agile development teams may include developers, designers, QA, testers, and more. But the question arises, should you hire in-house developers or outsource your SaaS product development? 

Let me help you choose the right resource for your SaaS product development.

Hiring In-house developers

When developing your SaaS product, the cost includes the remuneration given to the developers, infrastructure setup, hardware & software costs, training professionals, and other operational costs. 

Hiring in-house software developers in the UK may cost you around £150,000.

Here is a break-up cost for your clarification

Cost to hire £ 3200
Overall Team Salary £130,000
IT Expenses £20
IT System £1800
Technology Training £1000
Paid Benefits £4500
Overhead Cost £4000
Total Costs £144770


Partnering To A Development Company

The second and one of the most convenient options to build your SaaS product is to hire professionals via outsourcing companies. The outsourcing vendor assists you in executing specific business processes and takes complete ownership of end-end SaaS development.

Partnering with a SaaS product development company helps businesses launch their SaaS product faster. Here is the breakdown of developing SaaS products through outsourced partners.

Cost to hire  £1000
Overall Team Salary £3700
IT Expenses £0
IT System £0
Technology training £0
Paid benefits £0
Overhead costs £0
Total costs £3800


The outsourcing cost is around £38000 for the same number of developers and the hours worked.

Read Also: 

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Top SaaS Development Framework 

Now that you're aware of the development cost of your SaaS product let's know the top few SaaS development frameworks. With so many SaaS frameworks available in the market, we have listed the top frameworks you can opt for to develop your SaaS application.

  • ReactJs

Undoubtedly one of the most popular frameworks to integrate component-based structure for SaaS development is a front-end JavaScript library that helps developers build scalable user interfaces for large web applications. With ReactJS, manipulation is handy because it interfaces directly with Virtual DOM, provides a better user experience, and allows developers to create complex interfaces quickly.

  • Vue.Js

With over 150 thousand stars on Github, Vue.JS is another popular framework. It is primarily known for its SPAs and creative user interfaces; developers use this framework to develop large-scale web applications. It is an open-source interface that uses the Model View model structure. It also offers the reusability of components to build templates for SaaS products.


  • AngularJs

AngularJs is another front-end framework that helps developers build large-scale applications. It enables two-way data binding to minimise time consumption, making development much more straightforward. Along with CSS and HTML, the framework uses Typescript, an object-oriented programming language, enabling software developers to maintain code consistency.

  • Node.Js

Being an open-source framework, Node.Js uses "Single Threaded Event Loop" architecture to handle multiple clients simultaneously. 

It has a large community that provides scalability for applications. Being single-threaded, it can handle multiple connections simultaneously with high throughput.

  • Python

Big tech giants like Google, Youtube, and Instagram use Python as it can boost batteries-included features that support many features like authentication and messaging. With the Configuration and DRY patterns, the framework enables developers with techniques and tools to form a secure and good website or implement the safety features within the framework.

software development frameworks

Why Partnering With A SaaS Product Development Company Is A Smart Choice?

Partnering with a SaaS development company is smart as it enables you to hire the best developers for your project at a lower cost. It also allows you to complete your project smoothly and in a shorter time frame. 

Here are a few pointers to help you understand why partnering with a SaaS development company will be best for you.

  • Saves Money & Time

SaaS development is large-scale and often has multiple components. Thus, developing a SaaS MVP with limited features is complex and requires a skilled engineer.

Partnering with a SaaS development company will enable you to access cross-functional teams using cost-effective methods to build your product. It saves your time and money and restricts you from getting into the nitty-gritty of finding suitable developers.

  • Allows You To Work With Experienced Developers

Partnering with a SaaS development company enables you to build a dedicated remote team who manages product lifecycle and data. The managed project company comprises specialists who can navigate product development, keep track of the latest technologies, and design the best-suited product for your business requirements. 


  • Speeds Your Development Process

Choosing the right team of remote developers is wise to complete your SaaS development on time because they have assigned project managers to monitor the development process and technical issues.

Also, you don't need to hire or onboard expertise for different development processes and pay them more to speed up your project.

  • Scales Your SaaS Product Development

Embracing your SaaS product with new features is essential to remain in this competitive market. Partnering with a team will give you a better chance of implementing timely features and quickly meeting market demands.

Want To Build Your SaaS Product?

No doubt, developing a SaaS product requires a lot of effort, innovative thinking, and specialisation. So if you're looking to develop a SaaS product development, look no further. Choosing the right SaaS development partner can benefit you more before signing on the dotted line. At Classic Informatics, we have been a development partner for several startups and product companies.

Whether end-to-end SaaS application development to hiring developers as per your project, we help enterprises with fusing technology to create outstanding products.

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Topics : SaaS, SaaS Application

Nivedita Nayak

Written by Nivedita Nayak

Nivedita Nayak is a technical content writer in Classic Informatics, a leading web development company . She is a passionate writer, and loves to write for IT Industry.