Outsourcing vs In-House Development: How to Compare the Cost
By 65Seven Labs · · 4 min · Operations
Updated
- outsourcing
- cost savings
- global teams
- engineering
Compare the cost of delivering the same outcome
Hiring a team and engaging a development partner solve different problems. If you need continuing ownership of a product's roadmap, an in-house team may be the right long-term investment. If you need a defined first release or specific capacity, a delivery team can give you a different way to organise the work.
Start with the outcome and time period. “Launch the customer portal with billing and staff access” is a more useful basis for comparison than “hire two developers”. It makes the design, testing, backend work and management time visible on both sides.
Build a comparable cost model
| Cost or responsibility | In-house team | Development partner |
|---|---|---|
| Engineering capacity | Salaries and employer costs over the delivery period | Agreed project fee or team rates |
| Finding the team | Recruiting and interviewing time | Selecting and briefing the partner |
| Product decisions | Your product owner's time | Your product owner's time still matters |
| Design and testing | Include the people or services providing them | Check the proposal includes them |
| Tools and infrastructure | Accounts, hosting and subscriptions | Clarify what is included and who owns it |
| After launch | Continuing staff and operating costs | Agreed support, handover or continued delivery |
Use your actual offers, salary assumptions and proposals in this comparison. An hourly rate alone does not show whether the required work is included, how much management the engagement needs or how quickly the team can become effective.
Why a remote team can have different costs
65Seven Labs is a small senior remote team working through a UK registered company. Our delivery model does not carry a London or US office and salary base. That changes our cost structure; it does not create one savings percentage that applies to every engagement.
We offer full product delivery, dedicated mobile capacity and team augmentation. Which model fits depends on whether you already have product leadership and engineering ownership, and whether the work is a defined release or an ongoing backlog.
Our hourly rate comparison prices a chosen hours budget at our €25–€40 rate beside four agencies' published London and US rates, with the exchange rate and assumptions shown. It compares the cost of the same number of hours; it does not show whether two proposals cover the same work.
Choose the working model deliberately
For a founder building an initial product, a scoped project gives you a concrete screen list, price and launch date to assess. Our MVP calculator can provide a starting range for that conversation.
For a product team with a clear backlog and existing engineering practices, augmentation may make more sense. Agree who reviews code, makes architecture decisions, manages releases and handles support. Adding capacity without those responsibilities being clear can add coordination work.
If you need a web portal or internal dashboard alongside a mobile app, include both in the scope. The shared data model and access rules need an owner even when different people build the interfaces. Dash is an example of a product with both customer-facing loyalty features and business tools.
Make delivery observable
Ask to see working software regularly. Define the journeys that must pass before release, and make progress visible in your own repositories. A weekly build helps you evaluate the result while there is still time to adjust the scope.
At 65Seven Labs, the people on the discovery call are the people building the product. Our process uses two scoping sessions in week one, followed by working builds each week. You own the source code and IP, and handover includes the documentation, credentials and deployment setup.
Those are useful questions for any partner: who will do the work, how will you review it, and what will your team receive when the engagement ends?
Plan the handover before the first sprint
List the repositories, production services, domains, credentials and operational responsibilities. Agree how your team will release changes, receive incident reports and decide on maintenance work after launch.
Then compare proposals over the same period, including the time your own team will spend on decisions and coordination. Use the app cost comparison guide to check scope, or tell us about the team you need for a specific conversation.