How to Compare Software Development Proposals in 2025 (Beyond Hourly Rate)

If you put the same project brief in front of three software companies, you’ll almost always get three different prices. Sometimes 3–5x apart.

That doesn’t mean one vendor is “ripping you off” and another is magically cheap. It usually means they’re solving different problems with different levels of risk built in. This guide gives you a simple evaluation framework to compare apples‑to‑apples before you decide.

1. Normalize Scope Before You Compare Price

Start by building a simple comparison table with your core requirements on the rows and vendors on the columns. Mark each cell with:

• Y = included,
• P = partially included,
• N = not included.

Pay special attention to:

• Non‑functional requirements (performance, security, uptime).
• Integrations (ERP, CRM, payment gateways, data warehouse).
• Admin tools and reporting that ops teams actually need.

If one proposal is meaningfully lighter on scope, adjust your comparison—or ask the vendor to re‑quote to a shared baseline. Our RFP template gives you a structure for defining that baseline.

2. Compare Architecture and Technical Approach

Two proposals at the same price can have very different architecture implications. Ask each vendor to describe, at a high level:

• How they’d decompose the system (modules, services, boundaries).
• Where they expect load, complexity, or security risks.
• What observability (logging/metrics/alerts) they’re including.

If you don’t have an internal architect, bring in a trusted advisor or someone like our team at Stratagem Systems for a short review. We routinely help clients pressure‑test proposals for US & Canada software projects before they sign.

3. Evaluate Delivery Model and Risk Handling

Proposals should spell out how the work will be delivered, not just what you’ll get. Compare:

• Release cadence: how often you see working software.
• Communication rhythm: weekly check‑ins vs. sporadic updates.
• Change‑control process: how scope changes are priced and approved.

Then map proposals to the three classic models we break down in our upcoming guide on fixed‑bid vs T&M vs dedicated teams:

• Fixed‑bid: great when scope is clear; risky if it isn’t.
• Time & Materials: flexible, but requires strong product ownership on your side.
• Dedicated team: best when you have a long roadmap and can manage priorities weekly.

4. Look at 3–5 Year Total Cost of Ownership

Price tags on proposals ignore the fact that software lives for years. When comparing, ask each vendor for estimates or assumptions around:

• Hosting and infrastructure costs.
• Licensing for proprietary components, if any.
• Ongoing maintenance (bug fixes, upgrades, security patches).
• Internal time required from your team (PO, subject‑matter experts, IT).

Use our custom vs off‑the‑shelf comparison as a reference for how TCO plays out in real projects.

5. Build a Simple Proposal Scorecard

Create a one‑page scorecard with the following columns:

• Scope coverage (0–10)
• Architecture & technical approach (0–10)
• Process & communication (0–10)
• Vendor fit & references (0–10)
• Total cost of ownership (0–10, inverted—lower cost = higher score)

Have each stakeholder score independently, then compare. You’ll often find that the “middle‑priced” proposal is the clear winner once you look at risk and outcomes instead of just cost.

6. Next Steps

To make your next decision easier:

• Use the RFP template to make sure vendors are responding to the same brief.
• Send them our 25 questions ahead of your call so you can dig into substance quickly.
• Anchor your budget with the pricing guide before you evaluate any numbers.

If you’d like help sanity‑checking a proposal, we’re happy to review it during a short discovery call. We can also share how we’d scope the same project so you have a real benchmark—not just a spreadsheet of rates.