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What is your monthly cost for development in a monthly retainer model?

I am looking into hiring an agency to work on long-term development work on a monthly retainer. The cost is about ~$3,700 per "developer seat" month for an "American" firm with local account managers and Indian developers. (There are some project managers and architects in Europe as well).

I was talking to one of my advisors that told me that $4,000 per developer month could get me a mid-level person in the Ukraine. Now I am thinking I might be overpaying if I pull the trigger with the development company using Indian developers?

Does anyone have some general monthly retainer averages by developer skill level? By country?

If you are using an agency with a monthly retainer model how much are you paying? Where are the developers located?


24 Replies

George Stanislavos
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George Stanislavos Entrepreneur
Business Development Manager at Cloudium Tech
Hi Mr. Jones,
This is George Stanislavos from Cloudium Tech. I have read your post and I think it's a good to introduce www.cloudiumtech.com , we are an Enterprise IT Development Company , with our Management leaders in US & development team in India.

We have worked & working with many Enterprise companies and have a good history for 15+ years.

We are a team of 150 , Mobile , BI , Bigdata , UI/UX , Testing , Team. With the state of the art infrastructure.

And we can work with you for the best rate , our standard rate is 25 USD , but we are ready to work with you for 2800 USD/ Resource/PM.

Some of our work:


Some of the enterprises , under NDA.

When will be a good time to have a call with you ?

My Email : [removed to protect privacy]
Joren Winge
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Joren Winge Entrepreneur
iOS Developer
I worked on a project where they used developers from Armenia that had an agency. They did pretty decent work, and they were paying I think $3600 a head per full time developer. I can give you their info if you want. They also had designers, and strategy people on tap as well and spoke decent English. I've heard Ukrainian developers are great, but can be a little flaky. I've never personally worked with any. I do have a friend, John Uke, who is currently living in the Ukraine. He is putting teams together there and managing projects for US based companies. I can give you his contact also. Personally I've had nothing but bad experiences working with Chinese and Indian developers remotely. I've seen a lot of horror stories and been pulled in to fix projects. If it's too messy I pass. Communication can be a little tough as well. I've met tons of great Indian developers in the US and I'm sure there are tons of great Chinese developers but you have to separate the wheat from the and there is a lot of chaff.
Tanya Renne
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Tanya Renne Entrepreneur
CEO at Orchid, Inc.
We provide the same services sourcing from all over the globe. You could get a very senior developer from India for that kind of price. Also depends on the technology of course. Ukraine would cost more and be more culturally aligned (in my experience) regardless of the technology.

We charge $5K for senior Eastern European devs, $4K mid-level, $2500 entry, and $1500 for QA -- all with PM support state-side. I've staffed Indian and Pakistani devs before - some of them very senior, but I've never had one worth the same as a senior Eastern European frankly. YMMV.

It all depends on the communication, planning and how deeply ingrained the provider is. They should FEEL like staff to you. They should be as invested and as communicative as the folks you hire in-house - it should be such an intimate relationship that losing them would feel like losing your right arm - not just swapping out another warm, albeit skilled, body.

That's my .02 - happy to review any proposals or cost estimates they've given you.
Luciano Guasco
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Luciano Guasco Entrepreneur
Co-Founder FanFuel, full stack developer, data scientist
hi Kenneth, we have some devs labs in Argentina, and I would recommend you exploring this alternative. Developers level in Argentina is extremely high quality, since public universities promote heaps the use of last techs and good practices. If you keen to ping me, just follow up and we can talk more and contact you with the right peeps. cheers
Sergey Melnikov
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Sergey Melnikov Entrepreneur
Senior Application Developer at OMEGABYTE Computer Corporation
God damn! My company in Odessa, Ukraine is going to pay me ~$1500 for full hours, but they actually count time, so potentially even less. And they are trying to sell me as a team lead for US/Canada based company to clean up the code from 15+ years of Indian dev (which is a bad situation to say the least)!

So I don't know how much the management costs, but an estimation of $4000 per head/month is pretty realistic if not cautious. If you are eager to work with freelancers, you can get your work done even cheaper. Same qualification, less staff. But it depends on the amount of work: see, if you can search oDesk for talents vs hiring a company. Starting from 5 developers it could be easier to get by with a company, that will manage the whole thing. If less, just contact them individually and make one of them responsible.

If you want to evaluate from current salaries, please take a look at this page (it has data for most of IT in Ukraine - shows lower, median and high-level expectations, if you can't figure out what's written in Ukrainian):
Vinay Darp
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Vinay Darp Entrepreneur
VP Service Delivery at Curologic Systems Pvt. Ltd.
You could find a good, professional Indian agency, that provides you a person for about USD 2880 - which comes to roughly $18 an hour. This rate can have a blended team, like say one team lead (5-7 yrs exp), and other mid-level devs i.e. around 3 yrs experience. Of course, assuming you are asking nothing on any rare technology. Will be happy to be of further help. Cheers
Tarun Wadhawan
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Tarun Wadhawan Entrepreneur
Programme Manager
Hi Kenneth Monthly retainers are most fit when you have a project structure in place not to mention that a technical PM who is locally based is the most fit to oversee the process. 3700 or 4000 a month a seat, in India / Ukraine is still high. I would consider breaking your project into milestones or even structured work packages and agree on a fixed cost versus per seat. That way you both will benefit from unexpected surprises which is a known in offshore development. As far as rates you can consult websites like freelancer or even fiverr where you can get quotes from agencies or even individuals from different geographical locations to help get going with your analysis. Hope this helps.
Arseni R
0
2
Arseni R Entrepreneur
I design digital experiences that propel brands forward and attract the right audiences
This person in Ukraine would need to be very fluent in English and understand how to provide good service (and probably give a lot of options, suggestions, ideas), not just write "good" code. These qualities are unfortunately rare in Ukraine and especially India. On the other hand, you might get an "agency" in Ukraine with a project manager who is an "email forwarder" and does not want to think creatively or understand details of a project. I prefer to work with developers from Romania and I think Serbia has some good people. I recommend one developer who is fluent in English and not a developer-manager combination. What are you looking to build ?
Rama Atiya
0
0
Rama Atiya Entrepreneur
Sr. Associate Director of Digital Services at MIT Sloan School of Management
My answer may not be helpful, but I'll share. I have a much higher monthly retainer with an american firm with local developers, architects and designers as I need to be involved in all the details/decisions.
I personally won't concentrate much on where the developers are located (overseas), but more on how they collaborate with you and with the local project managers, what tools they use, and examples of their work. I often see that working with remote developers may be cheaper to start with, but may cause you more headache down the line. Not to be general in my assumptions, as I am sure there are good ones out there, but that's why one of the reasons I hired a local firm.
Hercules Schonfeldt
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Hercules Schonfeldt Entrepreneur
JFNA Director Digital Technology
Hi Kenneth,

I have local developers (US) and Have Strong Developers in Ukraine. I'm developer myself and I speak russian which makes communications easy (ukrainians do speak russian).
Here is a break down:

Local Developer full time: $120hr x 6(hours) x 5(days) x 4.3 (month) = $15,480
With retainer: $8000 a month

Ukrainian Developers full time:$25hr x 6(hours) x 5(days) x 4.3 (month) = $3225
With retainer: $2700 a month

I've been working with ukrainian developing companies for over a year, no problem at all.
Tried Indian Developers , had to cleanup code and waste time on explaining and time difference. Don't bother. Find European or South American developers. Or send me PM.


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