What does custom software cost for an SME?

For small and midsize businesses (SMEs) in Germany, custom software costs hours times hourly rate. Freelance software developers in the DACH region (Germany, Austria, Switzerland) report a median of EUR 90 per hour, IT service providers based in Germany EUR 120 to 150. The number of hours depends on processes, interfaces, roles, legacy data and operation. A small process that stays the same needs little of any of these. If it costs hours every week, a solution of your own can therefore already pay off. Sources: Freelancer-Kompass 2026, freelancermap, July 2, 2026, market observation by neckar.it, August 31, 2026

We write this from our own practice. We built the software of our portfolio companies ourselves and run it: vendor portals, shops with inventory connections to logistics partners in Lithuania and Hong Kong, internal boards, mail systems. Because we also earn money doing this work for clients, this page also says when you should not do it. The hourly rates come from the linked sources.

What drives the number of hours?

Five things decide whether a system is up and running in weeks or takes a year. Each of them changes the price more than the choice of service provider.

Cost driver	What makes it expensive	What keeps it affordable
Number of processes	Orders, inventory, invoicing, team, suppliers, commissions, all at once	One process first, the one that costs the most time today
Interfaces	Accounting, shop, logistics provider, payment provider, telephony, each with its own behavior and its own errors	Providers with a documented API, exports instead of real time where real time adds nothing
Roles and permissions	Five user groups with nested approvals and a four-eyes principle	Two roles for the first stage, refinement later
Legacy data	Twenty years of Excel with duplicates, free-text fields and missing keys	Migrate only active customers and open cases, keep the old records readable as an archive
Operation	High availability, certifications, round-the-clock on-call support	One server, daily backups, response times during business hours agreed in writing

Almost everyone underestimates the interfaces. A process within your own system is predictable. An interface to someone else's system is not, because that system changes, returns errors or cannot do things its marketing page claims. Ask the service provider whether they have built this particular interface before.

What hourly rates are common in Germany?

There are reliable figures for freelancers. The freelancermap Freelancer-Kompass 2026 evaluates around 5,400 survey responses collected between November 17, 2025 and February 8, 2026 and reports EUR 103 per hour across all fields. Source: Freelancer-Kompass 2026, freelancermap, retrieved September 22, 2026

Who	Hourly rate	Source
Freelance software and web developers, DACH, median	EUR 90	freelancermap, July 2, 2026
All IT freelancers, DACH, median	EUR 95	freelancermap, July 2, 2026
All freelancers, DACH, average	EUR 103	Freelancer-Kompass 2026, retrieved September 22, 2026
Freelancers hired directly, range	EUR 65 to 140	neckar.it, August 31, 2026
IT service providers based in Germany	EUR 120 to 150	neckar.it, August 31, 2026
Nearshore providers	EUR 50 to 110	neckar.it, August 31, 2026

The rates for service providers and nearshore come from one agency's market observation, not from an independent survey. We have not found such a survey for agencies. The markup pays for backup when someone is out, project management and liability. Source: neckar.it, August 31, 2026

An example, where the number of hours is an assumption and not a market figure: a first stage of a management system with one process, two roles and one interface, for which we assume 200 hours, costs EUR 18,000 at EUR 90 and EUR 27,000 at EUR 135. The same stage with three interfaces and migration of legacy data can take twice as long. Calculation based on freelancermap and neckar.it, 2026

What three systems of our portfolio companies would have cost at an agency, and what the same scope costs with us, is shown as an estimate on our home page. Many businesses, however, first need something much smaller.

Why do small standard processes in particular pay off?

A process that runs the same way every week is the simplest case for software. The rules are fixed, the exceptions are known, and data usually comes in or goes out at one or two points. Typical candidates:

• Generating quotes from templates, with customer data and prices from the system
• Order confirmation and invoice from a single entry
• Sending appointment confirmations with the right documents
• Reconciling inventory with the shop
• Passing receipts on to accounting, for example to Lexware Office

A calculation shows how much time is tied up in this. It is based on assumptions, not on a client case. Put in your own values.

Item	Value	Basis
Time per case by hand	15 minutes	Assumption
Cases per week	20	Assumption
Time per week	5 hours	15 minutes times 20
Working weeks per year	46	Assumption
Time per year	230 hours	5 hours times 46
Labor cost per hour worked, 2025	EUR 45	Federal Statistical Office (Destatis), April 29, 2026
Labor cost tied up per year	about EUR 10,350	230 hours times EUR 45

EUR 45 is what companies in industry and the service sector paid on average per hour worked in 2025, including non-wage labor costs. Your own figure may differ. Source: Federal Statistical Office (Destatis), press release no. 148, April 29, 2026

Calculated the other way around, EUR 10,350 at EUR 90 per hour equals about 115 developer hours, at EUR 135 about 77. If a solution takes over most of the manual work and needs fewer hours than that, it pays for itself in the first year. Hosting and maintenance belong in this calculation too. The hours gained stay in the business, because the goal is more time for your team, not fewer people.

Often the standard software stays where it is, and your own solution is only the piece in between that someone handles by hand today. If, on the other hand, a process is rare or looks different every time, a solution of your own does not pay off.

How small can a first stage be?

Small enough that it takes over a single process completely and runs on its own, even if a second stage never follows. One role, one interface, no legacy data. That lowers entry costs and risk: you see in daily use whether the process gets faster before you invest more.

We have not found an independent survey of prices for solutions this small, only provider figures that vary widely. That is why we do not give a range. The price depends mainly on the interfaces, the exceptions in the process and legacy data. The intro call and the initial direction clarify this, and both are free of charge.

Fixed price per stage or time and materials?

	Fixed price per stage	Time and materials
Who carries the risk	The service provider. They build in a buffer.	You. The price is only known at the end.
When it fits	The stage is small and clearly described, and both sides can see the whole of it.	Nobody knows in advance what is hidden in the legacy data or the third-party interface.
Where it goes wrong	Change requests during the stage turn into disputes about scope.	Without a weekly look at the hours, the budget runs away.
What you should ask for	A description of what works at the end of the stage, and what explicitly does not.	A cap, weekly time reports and the right to stop.

A fixed price for an entire system without stages sounds safe and is not. Either there is a large buffer in it that you pay for, or the service provider cuts corners at the end on whatever the contract did not describe precisely enough.

What does operation cost after handover?

Hosting. What a server costs depends on computing power, storage, backups, location and data traffic. For a few dozen users, a small virtual server from a German provider is usually enough. What you should check: a data center in the EU, a data processing agreement, daily backups with a restore test.

Maintenance. Libraries get security updates, browsers change, integration partners switch things over. That is not further development, but it costs hours, and those hours come every month. Agree on a fixed volume with an hourly rate and a response time instead of waiting for an emergency.

For comparison. Standard software hides both items in the license price. weclapp ERP Handel (trade) costs EUR 163 per user per month on an annual contract, so EUR 19,560 a year for ten users, for as long as you use it. Your own system costs development once and then hosting and maintenance, but no per-user license. At what number of users and what term this flips, we calculate on the page Your own management system or standard software? Source: weclapp pricing, retrieved September 22, 2026

Why does building in stages reduce costs?

Because the most expensive software is the software nobody uses. If you build one stage and work with it, after four weeks you know what the next one really needs. Every feature you drop is hours saved. Mistakes surface early, while they are cheap: a flaw in the data model costs an afternoon in week two, and weeks after a year of full build-out.

After each stage you can stop, pause or switch service providers without what has been built losing its value. The prerequisite is that source code, documentation and access credentials are with you, not with the service provider. To be fair, stages also take coordination. If you know exactly what you want, you can take bigger steps. With management systems for SMEs, that is rarely the case.

When is custom software the wrong choice?

When your process is the same as what a thousand other businesses do. Accounting, payroll, email, appointment booking, a simple CRM: for these there is standard software that starts at EUR 7.90 per month and has been tested by many users. Your own system pays off where the process is the core of your business, where several tools have to work together or where standard software forces you into workarounds that cost time every day. Source: Lexware Office pricing, retrieved September 22, 2026

This also applies on a small scale. If your booking tool already sends the appointment confirmation the way you need it, you build nothing.

How does it work at B&S?

1. Intro call. You describe the process that costs time. One hour, online or at your premises, free of charge.
2. Initial direction. We tell you what can help: a solution of your own, an AI assistant, standard software or a change in the process. This is also free of charge.
3. Proposal. You receive a written proposal for the first stage.
4. Implementation in stages. The first stage goes into daily use. Further stages only follow if you want them.

Source code, documentation and access credentials stay with you. And if standard software is enough, you will hear that from us in the intro call.

Frequently asked questions

What does an hour of software development cost in Germany?

In the freelancermap Freelancer-Kompass 2026, freelance software and web developers in the DACH region (Germany, Austria, Switzerland) report a median hourly rate of EUR 90, all IT freelancers together EUR 95. IT service providers based in Germany charge EUR 120 to 150, according to one agency's market observation. There is no independent study of agency rates. Sources: freelancermap, July 2, 2026, neckar.it, August 31, 2026

Does custom software also pay off for small processes?

Yes, if the process happens often, always runs the same way and takes time by hand. An example based on assumptions: 15 minutes per case and 20 cases per week add up to 5 hours per week. Over 46 working weeks at an average labor cost of EUR 45 per hour (Federal Statistical Office, 2025), that is about EUR 10,350 a year. If a standard tool already handles the process, building your own does not pay off. Source: Federal Statistical Office (Destatis), April 29, 2026

How small can a first stage be?

Small enough that it takes over a single process completely and runs on its own, for example generating quotes from templates or reconciling inventory with the shop. That lowers entry costs and risk, because you see in daily use whether the stage saves time before you invest further.

Why can nobody quote a price without a conversation?

Because the price is hours times hourly rate, and the hours depend on five things: the number of processes, the number of interfaces, the number of roles and permissions, the amount of legacy data that has to be migrated, and the requirements for operation. Anyone who quotes a price without this information is guessing.

Fixed price or time and materials?

A fixed price per stage if the stage is small enough for both sides to see the whole of it. Time and materials if nobody knows in advance what is involved, for example with legacy data or untested interfaces. A fixed price for an entire system without stages can only be kept with a markup or with cuts.

What does operation cost after handover?

Hosting, security updates, backups and small adjustments. Hosting depends on server capacity, storage, backups and location. Maintenance is usually agreed as hours per month. Both belong in the comparison with standard software, which hides these costs in the license price.

Why does building in stages reduce costs?

Because each stage shows in real operation what the next stage really needs. Features nobody uses do not get built. Mistakes surface early, while they are cheap. And you can stop after any stage without what has been built losing its value.