Software Development Cost Calculator
Estimate development cost from effort, rates, overhead and contingency.
About Software Development Cost Calculator
Fully loaded cost per developer month is typically 50 to 60 per cent above salary once overhead and contingency are included. Contingency is not padding but recognition that estimates are systematically optimistic. Comparing the fully loaded figure against a contractor rate is the only fair basis for build-versus-buy decisions.
Formula
Software Development Cost
Cost = developer months × rate, plus overhead, tooling and contingency
- developer month
- One developer working for one month, the standard effort unit
- fully loaded cost
- Direct labour plus all overhead and contingency
Worked example
With the default values below, Software Development Cost Calculator returns Total Development Cost of $445,500.00. Change any input above and every figure here is recalculated in your browser.
Inputs used
- Developersminimum 0
- 5
- Durationminimum 0 months
- 6 months
- Monthly cost per developerminimum 0
- 9,500
- Management and infrastructure overheadaccepts 0–100 %
- 25 %
- Contingencyaccepts 0–100 %
- 20 %
- Tooling and licence costminimum 0
- 15,000
Results
- Total Development Cost
- $445,500.00
- Direct Labour Cost
- $285,000.00
- Overhead Cost
- $71,250.00
- Contingency Reserve
- $74,250.00
- Fully Loaded Cost per Developer Month
- $14,850.00
Step by step
- 1Values used
- 2Software Development Cost
- 3Total Development Cost= 445,500.00
- 4Direct Labour Cost= 285,000.00
- 5Overhead Cost= 71,250.00
- 6Contingency Reserve= 74,250.00
- 7Fully Loaded Cost per Developer Month= 14,850.00
Assumptions and limits
- The result is derived only from the 6 inputs listed above. Anything not among them is not part of the calculation.
- In particular, this calculator does not take inflation, tax or compounding frequency into account.
- Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.
Frequently Asked Questions
How is Software Development Cost calculated?
Cost = developer months × rate, plus overhead, tooling and contingency Fully loaded cost per developer month is typically 50 to 60 per cent above salary once overhead and contingency are included. Contingency is not padding but recognition that estimates are systematically optimistic.
Why does Software Development Cost matter?
Comparing the fully loaded figure against a contractor rate is the only fair basis for build-versus-buy decisions.
What values do I need to enter?
This calculator takes 6 inputs: Developers, Duration, Monthly cost per developer, Management and infrastructure overhead, Contingency, Tooling and licence cost. The pre-filled defaults are a realistic starting point — replace them with figures from your own environment for a result you can act on.