Why most software project estimates mislead You - and what You should do instead

When companies approach us at Marotino, one of the first questions we hear is: “Can you give me a rough estimate for my project? Just a ballpark, so I can compare you with other agencies.”

The honest answer? Yes, we can give you a ballpark. And while that number can give you a starting point, the real value comes when we explore your project together.

Price plays a critical role in decision-making, but in custom software development cost estimation, the numbers given upfront are rarely accurate. Unlike buying a ready-made product, you are not selecting an item from a price list. You are investing in a unique solution, shaped by countless variables that only emerge once the work begins.

That’s why relying solely on early estimates often leads to misguided decisions. Let’s explore why these numbers don’t tell the full story and how you can make a smarter, risk-free choice when selecting your technology partner.

Why early estimates rarely match reality

1. Software projects evolve

Every digital product, whether a mobile app, SaaS platform, or enterprise solution changes as soon as it meets real users. Feedback shifts priorities, features are refined, and technical challenges appear. In time-and-material contracts, this means the final cost grows or shrinks depending on real progress, not the initial prediction.

So, even if you receive a detailed cost breakdown after the first meeting, treat it as a starting reference rather than a final budget. What matters more is knowing the daily or hourly rates of developers, designers, and project leads, since those determine your actual investment. What matters more is knowing the daily or hourly rates of developers, designers, and project leads, since those determine your actual investment.

2. No two estimates include the same things

One agency might include a Scrum Master, QA specialists, or support hours in their calculation. Another might show only developer costs. Some add infrastructure, training, or ongoing maintenance, while others exclude them.

Comparing estimates without knowing what’s actually included is like comparing apples to oranges.

3. Human bias distorts numbers

Sales managers who want to win quickly may underestimate the budget. Others, aiming to be cautious, might give you a much higher figure than the reality. Both approaches mislead you.

Choosing a partner based only on an underestimated proposal can be dangerous, it risks blowing your budget mid-way and leaving you with a half-finished product.

4. Reliable estimates take real work

To prepare a trustworthy cost projection, an agency needs time: workshops, analysis, and a deep understanding of your business goals. A quick number thrown together after a call is not an estimate, it’s guesswork.

At Marotino Software, we believe software project estimation should come after discovery workshops, not before. That’s when we can fully understand your requirements, assess risks, and outline the smartest path forward.

Can AI help with estimation?

The rise of AI-powered tools means some agencies now use algorithms to generate ballpark figures based on past projects. While this can speed up early orientation, AI cannot capture the nuances of your business model, customer expectations, or market challenges.

Think of AI as a compass: it points in a direction. But only a team that spends time with you can chart the real map.

What You should really look at when choosing a software agency

If estimates are unreliable in the early stage, what factors should guide your shortlist?

1. Technical expertise

Does the team’s skill set align with your project’s complexity? If your product requires advanced UX, machine learning, or cloud scaling, make sure the agency can provide specialists in those areas, not just coders.

2. Communication and transparency

Great partnerships rely on clear, consistent communication. Notice how quickly a company responds to your first inquiry. Do they listen carefully, ask relevant questions, and give thoughtful answers? These soft skills matter as much as technical ones.

3. Portfolio and testimonials

Case studies, client reviews, and product showcases reveal how an agency tackles real-world challenges. Instead of looking only at the years of experience, focus on projects similar to yours.

4. Business mindset

The best agencies don’t just “build what you ask.” They challenge your assumptions, highlight risks, and look for ways to make your product successful. Look for a partner who understands not only code, but your business goals.

Why software project workshops beat estimates

Two clients can write identical specifications for an app. Hand those documents to two different teams, and the results will be entirely different. Why? Because specs don’t capture context.

That’s why workshops matter. They allow both sides to:

• Clarify assumptions

• Spot hidden risks early

• Prioritize features

• Align business goals with technical execution

After workshops, you receive a realistic, context-driven estimate, not just a random number.

Final Thoughts

Early estimates are a helpful first step, but they should always be followed by proper discovery to avoid hidden risks and surprises. They rarely reflect the real costs of building a custom product and can hide risks that surface later.

If you want to compare agencies fairly, focus first on rates, skills, communication style, and case studies. Then, select one or two companies for dedicated workshops. That’s the stage where trustworthy estimates are born.

At Marotino Software Agency, we don’t just hand out numbers - we build partnerships. Our approach is simple: understand your business deeply, design smart solutions, and deliver value that lasts.

If you’re considering your next digital product, start with a conversation, not a price tag.