How Much Does Software Testing Cost and How to Optimize It?

The need for stringent quality control in software development is undeniable since software defects can disrupt interconnected systems and trigger major malfunctions, leading to significant financial losses and damaging a brand’s reputation.

Consider high-profile incidents such as Nissan’s recall of over 1 million vehicles due to a fault in airbag sensor software or the software glitch that led to the failure of a $1.2 billion military satellite launch. In fact, according to the Consortium for Information and Software Quality, poor software quality costs US’ companies over $2.08 trillion annually.

Despite the clear need for effective quality control, many organizations find its cost to be a major obstacle. Indeed, a global survey of IT executives reveals that over half of the respondents view software testing cost as their biggest challenge. No wonder, companies increasingly look for solutions to reduce these costs without sacrificing quality.

In this article, we’ll discuss software testing cost in detail, from its key drivers and estimated amounts to effective ways to cut expenses wisely.

Let’s dive right in!

4 Common Cost Drivers In Software Testing

A 2019 survey of CIOs and senior technology professionals found that software testing can consume between 15% and 25% of a project’s budget, with the average cost hovering around 23%.

So, what drives these substantial costs in software testing? Read on to find out.

4 Common Cost Drivers In Software Testing

Project complexity

First and foremost, the complexity of a software project is a key determinant of testing costs.

Clearly, simple projects may require only minimal testing, whereas complex, multifaceted applications demand more extensive testing efforts. This is due to the fact that complex projects usually feature intricate codebases, numerous integration points, and a wide range of functionalities.

Testing methodology

The chosen testing methodology also plays a big role in defining testing costs.

Various methodologies, such as functional testing, non-functional testing, manual, and automated testing, carry different cost implications.

Automated testing, while efficient, requires an upfront investment in tools and scripting but can save time and resources in the long run since it can quickly and accurately execute repetitive test cases.

On the other hand, manual testing might be more cost-effective for smaller projects with limited testing requirements, yet may still incur ongoing expenses.

Dig deeper: Automation testing vs. manual testing: Which is the cost-effective solution for your firm?

Testing team

The testing team’s type and size are also big cost factors. This includes choosing between an in-house and outsourced team, as well as considering the number and expertise of the company’s testing professionals.

An in-house team requires budgeting for salaries, benefits, and training to ensure they have the necessary skills and expertise. Alternatively, outsourcing to third-party providers or working with freelance testers can reduce fixed labor costs but may introduce additional considerations like contract fees and potential language or time zone differences.

Learn more: 6 reasons to choose software testing outsourcing

Regarding team size and skills, obviously, larger teams or those with more experienced testers demand higher costs compared to smaller teams or those with less experienced staff.

Testing tools and infrastructure

Another factor that significantly contributes to the overall cost of software testing is testing tools and infrastructure.

Tools such as test management software, test automation frameworks, and performance testing tools come with their own expenses, from software licenses, training, and ongoing maintenance, to support fees.

For further insights, consider these resources:

As for testing infrastructure, it refers to the environment a company establishes to perform its quality assurance (QA) work efficiently. This includes hardware, virtual machines, and cloud services, all of which add up to the overall QA budget.

8 Key Elements That Increase Software Testing Expenses

Even with a well-planned budget, unexpected costs might still emerge, greatly increasing the expenses of software testing.

Below are 8 major elements that may cause a company’s testing expenses to rise:

8 Key Elements That Increase Software Testing Expenses

Rewriting programs: When errors and bugs are detected in software, the code units containing these issues need to be rewritten. This process can extend both the time and cost associated with software testing.
System recovery: Failures during testing or software bugs can result in substantial expenditures related to system recovery. This includes restoring system functionality, troubleshooting issues, and minimizing downtime.
Error resolution: The process of identifying and resolving bugs, which often requires specialized resources, extensive testing, and iterative problem-solving, can add new costs to the testing budget.
Data re-entry: Inaccuracies found during testing often necessitate data re-entry, further consuming time and resources.
Operational downtime: System failures and errors can disrupt operational efficiency, leading to downtime that causes additional costs for troubleshooting and repairs.
Strategic analysis sessions: Strategic analysis meetings are necessary for evaluating testing strategies and making informed decisions. However, these sessions also contribute to overall testing costs through personnel, time, and resource expenditures.
Error tracing: Difficulty in pinpointing the root cause of software issues can lengthen testing efforts and inflate costs. This involves tracing errors back to their source, investigating dependencies, and implementing solutions accordingly.
Iterative testing: Ensuring that bug fixes do not introduce new issues often requires multiple testing rounds, known as iterative testing. Each iteration extends the testing timeline and budget as testers verify fixes and guarantee overall system stability.

How Much Does Software Testing Cost?

So, what’s the cost of software testing in the total development cost exactly?

It comes as no surprise that there’s no fixed cost of software testing since it varies based on lots of factors outlined above.

But here’s a quick breakdown of software testing cost estimation, based on location, testing type, and testing role:

Cost estimation of QA testers based on location

Location	Rates
USA	$35 to $45/ hour
UK	$20 to $30/ hour
Ukraine	$25 to $35/ hour
India	$10 to $15/ hour
Vietnam	$8 to $15/ hour

Learn more: Top 10 software testing companies in Vietnam in 2022

QA tester cost estimation based on type of testing

Type of testing	Rates
Functional testing	$15 to $30/ hour
Compatibility testing	$15 to $30/ hour
Automation testing	$20 to $35/ hour
Performance testing	$20 to $35/ hour
Security testing	$25 to $45/ hour

QA tester cost estimation based on their role

Type of tester	Rates
Quality assurance engineer	$25 to $30/ hour
Quality assurance analyst	$20 to $25/ hour
Test engineer	$25 to $30/ hour
Senior quality assurance engineer	$40 to $45/ hour
Automation test engineer	$30 to $35/ hour

How To Reduce Software Testing Costs?

Since many companies are questioning how to reduce the cost of software testing, we’ve compiled a list of top 8 practical best practices to help minimize these costs without compromising quality and results. Check them out below!

How To Reduce Software Testing Costs?

Embrace early and frequent testing

Testing should be an ongoing task throughout the development phase, not just at the project’s end.

Early and frequent testing helps companies detect and resolve bugs efficiently before they escalate into serious issues later on. Plus, post-release bugs are more detrimental and costly to fix, so addressing them early helps maintain code quality and control expenses.

Prioritize test automation

Test automation utilizes specialized software to execute test cases automatically, reducing the reliance on manual testing.

In fact, according to Venture Beat, 97% of software companies have already employed some level of automated testing to streamline repetitive, time-consuming QA tasks.

Although implementing test automation involves initial costs for tool selection, script development, and training, it ultimately leads to significant time and cost savings in the long term, particularly in projects requiring frequent updates or regression testing.

Learn more: Benefits of test automation: Efficiency, accuracy, speed, and ROI

Apply test-driven development

Test-driven development (TDD) refers to writing unit tests before coding. This proactive approach helps identify and address functionality issues early in the development process.

TDD offers several benefits, including cleaner code refactoring, stronger documentation, less debugging rework, improved code readability, and better architecture. Collectively, these advantages help reduce costs and enhance efficiency.

Consider risk-based testing

Risk-based testing prioritizes testing activities based on the risk of failure and the importance of each function.

By focusing on high-risk areas, this approach simplifies test planning and preparation according to the possibility of risks, which not only improves productivity but also makes the testing process more cost-effective.

Implement continuous testing and DevOps

DevOps focuses on combining development and operations, with testing embedded throughout the software development life cycle (SDLC).

When integrating testing into the DevOps pipeline like that, businesses can automate and execute tests continuously as new code is developed and integrated, thereby minimizing the need for expensive post-development testing phases.

Use modern tools for UI testing

Automating visual regression testing with modern, low-code solutions is an effective approach for UI testing.

These tools harness advanced image comparison, analyze and verify document object model (DOM) structure, on-page elements, and handle timeouts automatically. Thus, they allow for rapid UI tests – often in under five minutes – without requiring extensive coding.

In the long run, this practice saves considerable resources, reduces communication gaps among developers, analysts, testers, and enhances the development process’ overall efficiency.

Account for hidden costs

Despite efforts to manage and reduce software testing expenses, unexpected hidden costs can still arise.

For instance, software products with unique functionalities often require specialized testing tools and techniques. In such instances, QA teams may need to acquire new tools or learn specific methodologies, which can incur additional expenses.

Infrastructure costs can also contribute to hidden costs, including fees for paid and open-source software used in automated testing, as well as charges for cloud services, databases, and servers.

Furthermore, updates to testing tools might cause issues with existing code, necessitating extra time and resources from QA engineers.

Outsource software testers

For companies lacking the necessary personnel, skills, time, or resources for effective in-house testing, outsourcing is a viable alternative.

Outsourcing enables access to a broader pool of skilled testers, specialized expertise, and cost efficiencies, particularly in regions with lower labor costs, such as Vietnam.

However, it’s important for businesses to carefully evaluate potential outsourcing partners, establish clear communication channels, and define service-level agreements (SLAs) to ensure the quality of testing services.

For guidance on selecting the right software testing outsourcing partner, check out our resources on the subject:

At LQA – Lotus Quality Assurance, we offer a wide range of testing services, from software and hardware integration testing, mobile application testing, automation testing, web application testing, to embedded software testing and quality assurance consultation. Our tailored testing models are designed to enhance software quality across various industries.

4 Main Categories of Software Testing Costs

Software testing expenses generally fall into four primary categories:

4 Main Categories of Software Testing Costs

Prevention costs

Prevention costs refer to proactive investments aimed at avoiding defects in the software. These costs typically include training developers to create maintainable and testable code or hiring developers with these skills. Investing in prevention helps minimize the likelihood of defects occurring in the first place.

Detection costs

Detection costs are related to developing and executing test cases, as well as setting up environments to identify bugs. This involves creating, running tests, and simulating real-world scenarios to uncover issues early. Investing in detection plays a big role in finding and addressing problems before they escalate, helping prevent more severe issues later on.

Internal failure costs

These costs are incurred when defects are found and corrected before the product is delivered. They encompass the resources and efforts needed to debug, rework code, and conduct additional testing. While addressing bugs internally helps prevent issues from reaching end users, it still causes significant expenses.

External failure costs

External failure costs arise when technical issues occur after the product has been delivered due to compromised quality. External failure costs can be substantial, covering customer support, warranty claims, product recalls, and potential damage to the company’s reputation.

In general, the cost of defects in software testing accounts for a major portion of the total testing expenses, even if no bugs are found. Ensuring these faults are addressed before product delivery is of great importance for saving time, reducing costs, and maintaining a company’s reputation. By carefully planning and evaluating testing activities across these categories, organizations can develop a robust testing strategy that ensures maximum confidence in the final product.

FAQs about Software Testing Cost

Is performing software testing necessary?

Absolutely! Software testing is essential for identifying and eliminating costly errors that could adversely affect both performance and user experience. Effective testing also covers security assessments to detect and address vulnerabilities, which prevents customer dissatisfaction, business loss, and damage to the brand’s reputation.

How to estimate the cost of software testing?

To estimate the cost of software testing, companies need to break down expenses into key categories for clearer budget allocation.

These categories typically include:

Personnel costs: This covers the salaries, benefits, and training expenses for testing team members, including testers, test managers, and automation engineers.
Infrastructure costs: These costs encompass hardware, software, and cloud services needed for testing activities, such as server hardware, virtual machines, test environments, and third-party services.
Tooling costs: For smaller projects, open-source testing tools may suffice, while larger projects might require premium tool suites, leading to higher expenses.

How much time do software testers need to test software solutions?

The duration of software testing projects varies based on lots of factors, from project requirements, the software’s type and complexity, to features and functionalities included and the testing team’s size.

Final Thoughts about Software Testing Cost

Software testing is a pivotal phase in the SDLC, and understanding its costs can be complex without precise project requirements and a clearly defined scope. Once the technology stack and project scope are established, organizations can better estimate their software testing costs.

For effective software testing cost reduction, companies can explore several strategies. Some of them are implementing early and frequent testing, leveraging test automation, adopting risk-based testing, and integrating testing into the DevOps pipeline. Additionally, outsourcing testing can offer significant cost benefits.

At LQA, we provide comprehensive software testing solutions designed to be both high-quality and cost-effective. Rest assured that your software is free of bugs, user-friendly, secure, and ready for successful deployment.