The short answer
To choose the right software development company, start by checking the business, testing how it thinks about your problem, and comparing proposals on the same basis. Verify the ABN and insurance, meet the people who will write the code, ask how they test and deploy, compare quotes line by line rather than by total, and sign only a contract that gives you the source code and the intellectual property. The cheapest quote is rarely the cheapest project.
Key takeaways
- Decide what kind of partner you need first: a product studio, an enterprise integrator, a specialist, or extra developers for your own team.
- Run basic business checks before any meeting: ABN, company age, insurance, and who the directors are.
- Meet the delivery team, not only the sales lead, and ask them to explain how they test, review and deploy code.
- Compare quotes by what's included, the assumptions and the risk each party carries. Totals alone mislead.
- Make sure the contract assigns the IP to you and that the code lives in a repository you control from the start.
What kind of software company do you actually need?
Start by matching the type of firm to the type of work. “Software development company” covers very different businesses, and most bad matches happen because a buyer hired the wrong kind, not a bad one.
| Type of firm | Best for | Watch out for |
|---|---|---|
| Product studio | New apps and SaaS products where design and user experience matter | May be light on enterprise integration, security reviews and procurement |
| Enterprise integrator | Large programs, ERP and CRM work, multi-vendor environments | Higher rates and overheads; small projects can get junior staff |
| Specialist boutique | One domain done deeply: AI, payments, data, legacy modernisation | Narrow; you may need another firm for adjacent work |
| Staff augmentation provider | Adding developers to a team you already manage | You carry the delivery risk and the management load |
| Freelancer | Small, well-defined jobs with a clear owner on your side | Single point of failure; limited cover for leave or illness |
If you have a capable internal product owner and tech lead, augmentation or a freelancer can be the most efficient choice. If you don’t, you need a firm that takes responsibility for delivery, not just hours. Our freelancer vs agency vs in-house comparison covers that choice.
Which checks should you run before the first meeting?
Spend 30 minutes on public checks before you spend hours in meetings. They filter out firms that aren’t what their website suggests.
- ABN and entity. Look up the ABN on the Australian Business Register. Check the entity name matches the one that will sign your contract, and note when it was registered.
- Where the work is done. Ask directly whether developers are employees, contractors, or a subcontracted offshore team. All three can work; you just need to know.
- Insurance. Professional indemnity and public liability as a minimum, cyber insurance if they’ll touch personal information or production systems. Ask for certificates of currency.
- Claims you can verify. Certifications (ISO 27001, SOC 2), partner tiers and panel memberships should appear on the issuing body’s own register or directory. If you can’t find them there, ask why.
- Named people. Can you find the senior engineers on the firm’s site or professional profiles? A firm that names only its founder and sales staff may be subcontracting the build.
What questions should you ask a software development company?
Put your questions to the people who will write your code, not only the sales lead, and listen for specifics. Good engineering teams describe their process in concrete terms without being prompted.
On engineering practice
- How does code get from a developer’s laptop into production? Who reviews it?
- What automated tests do you write, and what runs before every deploy?
- How do you handle secrets, access control and security scanning? Do you test against a standard such as the OWASP Application Security Verification Standard?
- How do you build for accessibility? Which WCAG level do you test to?
- What documentation will we have at handover?
On delivery and communication 6. How often will we see working software, not status reports? 7. Who is our day-to-day contact, and what hours do they work in AEST? 8. How do you handle a change in scope halfway through? 9. What was the last project that went over time or budget, and why?
On ownership and exit 10. Is the code in our repository from the first commit? 11. When does IP transfer to us? 12. If we part ways, what do we get and how long does handover take?
Question 9 matters most. Every firm has had a project go wrong. The useful signal is whether they can explain what happened and what they changed.
How do you compare three quotes fairly?
Normalise the quotes before you compare totals. Different firms price different scope, carry different risks and make different assumptions, so the headline number is the least informative part of a proposal.
Here is an illustrative comparison for a mid-sized internal operations platform. The firms and numbers are made up to show the method, not market quotes.
| Firm A | Firm B | Firm C | |
|---|---|---|---|
| Headline price (AUD, ex GST) | $140k | $210k | $95k |
| Pricing model | Fixed price after discovery | Fixed price | Time and materials estimate |
| Discovery included | Paid separately ($15k) | Included, 1 week | None |
| Integrations priced | Both systems | Both systems | One; second “to be scoped” |
| Automated testing | Unit and end-to-end | Unit only | Not mentioned |
| Deployment and hosting setup | Included | Included | Excluded |
| Warranty period | 60 days | 90 days | 30 days |
| Code in client repository | From day one | At handover | Not stated |
| Who carries overrun risk | Firm | Firm | Client |
On paper Firm C is cheapest. Once you add the missing integration, hosting setup, testing and the overrun risk that sits with you, it may well be the most expensive. Firm A and Firm B cover comparable scope. Once Firm A’s discovery is added it is still about $55k cheaper ($155k against $210k), so the choice between them comes down to price and code access against Firm B’s longer warranty, and to which team you trusted in the technical session.
To normalise your own quotes:
- List every deliverable across all proposals and mark which firm includes it.
- Ask each firm to price the gaps, or estimate them yourself.
- Note who carries the risk of overruns under each pricing model. Our fixed price vs time and materials guide explains how each model shifts risk.
- Add 12 months of running and support costs to each.
- Only then compare totals.
For typical Australian ranges by project size, see how much custom software costs in Australia.
Which contract terms should you insist on?
Insist on IP assignment, source code control and a clean exit. In Australia the developer owns the copyright in code it writes unless a written agreement assigns it to you, so paying for software doesn’t by itself make you the owner.
| Term | What to ask for | Why |
|---|---|---|
| IP assignment | All project IP assigned to you on payment for each milestone, with a licence to any pre-existing tools the firm uses | Default copyright sits with the developer |
| Source code | Code in your repository throughout, not delivered at the end | Protects you if the firm fails or the relationship ends |
| Acceptance | Written acceptance criteria and a testing window per milestone | Prevents disputes about “done” |
| Warranty | A defect-fix period after go-live at no cost | Bugs surface in real use |
| Privacy and security | Obligations consistent with the Privacy Act and APP 11, breach notification to you | You remain responsible for personal information |
| Liability | A cap proportionate to the contract value, with carve-outs for data breaches and IP infringement | Standard caps can be far below your real exposure |
| Exit and handover | Documented handover, reasonable assistance at agreed rates | Lets another team continue |
This is general information, not legal advice. Have a lawyer review any contract of material value. Our contract checklist goes through each clause.
Which software development company is best?
There’s no single best software development company, only the best fit for your project, and that fit is something you can test. A firm that’s excellent at consumer apps may be the wrong choice for an ERP integration, and the right partner for a startup’s first version may be too small for a multi-year government program.
“Top 10” and “best software developer” lists can help you build a longlist, but treat them as a starting point. Some are sponsored or built from profiles the firms submit themselves, so check any claim against the evidence the list links to. Then judge the shortlist on things you can verify: named engineers you’ve met, how they answer the technical questions above, comparable work they can show you, reference calls with past clients, and a proposal that prices the same scope as everyone else’s.
The firm that scores best on those checks is the best company for you, whatever its ranking.
What are the warning signs in a proposal?
Be wary of certainty without discovery, and silence on the things that cost money later.
- A firm fixed price for a large project based on one meeting and no written scope.
- No mention of testing, deployment, hosting or post-launch support.
- Hosting, domains or code repositories set up in the vendor’s name.
- Pricing that depends on an ongoing licence to the vendor’s own framework, with no source code access.
- “Unlimited revisions” or similar promises that can’t be sustainable.
- The team is described as a headcount, not named people.
- Pressure to sign quickly, or large deposits before any deliverable.
A realistic selection timeline
Most mid-sized projects take four to eight weeks from brief to signed contract. Rushing this stage is the most common way to lose far more time later.
| Week | Activity |
|---|---|
| 1 | Write the brief: problem, users, systems, constraints, budget range, deadline |
| 1 to 2 | Public checks, shortlist of three, send brief and questions |
| 2 to 3 | Technical sessions with each delivery team |
| 3 to 4 | Written proposals received, normalised and compared |
| 4 to 5 | Reference calls, insurance and claim verification |
| 5 to 8 | Paid discovery with the preferred firm, then contract for the build |
If you’re a government agency or supplier, the Digital Transformation Agency’s Digital Service Standard is worth reading before you write the brief, because it shapes how services are expected to be designed and tested.
How All Webbed Labs works, so you can compare us
We’d encourage you to put us through exactly these checks. All Webbed Labs (AW Labs Pty Ltd, ABN 32 698 684 105) is based in Five Dock, Sydney. Our founder has built software professionally since 2019 and run the agency All Webbed Up since 2021; All Webbed Labs launched in mid 2026 as a partnership of developers and founders.
Our model: paid discovery, then a fixed price for the build. Senior engineers only. Your code is in your repository from day one, and IP transfers on completion. We sign an NDA before you share anything, work AEST hours, and every change passes automated checks and a senior engineer’s review before it’s deployed. We don’t hold ISO or SOC 2 certifications, so if your procurement requires them, we’re not the right fit for that contract. See our enterprise software service or how we work.
Frequently asked questions
Is it better to choose a local software company?
Local helps with workshops, time zone and legal recourse, but it isn't a guarantee of quality, and remote delivery works well for most projects. Choose on capability and evidence first, then weigh location as one factor. Our onshore vs offshore guide covers the trade-offs, including when offshore is the better choice.
How do you choose the best offshore software development company?
Run the same checks as for a local firm, then add four: how many working hours overlap with AEST, which country's law governs the contract and whether you could enforce it there, how the firm handles personal information given your APP 8 obligations, and who exactly will write the code. Our onshore vs offshore guide covers the trade-offs, including when offshore is the better choice.
How do I choose a custom software development company rather than a product reseller?
Ask whether the proposal builds software you'll own or configures a product you'll license. A custom software development company should put the code in your repository, assign the IP to you and explain the architecture it will build. If the price depends on an ongoing licence to the firm's own platform, you're buying a product, which can be fine, but compare it against SaaS options rather than custom builds.
How many quotes should I get for a software project?
Three is typical. Give every firm the same brief so the quotes are comparable, and expect the range to be wide on early estimates, because each firm is making different assumptions about scope you haven't defined yet.
Should I pay for a discovery or scoping phase?
For anything beyond a small, well-defined job, yes. A paid discovery produces a scope, architecture and firm price you own, and you can take it to another firm if you choose. It also lets you see how the company works before committing to the full budget.
What insurance should a software development company have?
At minimum, professional indemnity and public liability. Many enterprise and government buyers also require cyber insurance. Ask for certificates of currency and check the cover amounts against your procurement policy.
What if the company goes out of business mid-project?
If the code is in your own repository, the documentation is current and the IP is assigned as work is paid for, another team can pick it up. That's why repository control and IP assignment matter more than any promise about the company's longevity.
Sources
- Does my business own the software it is having developed? , LegalVision
- ABN Lookup , Australian Business Register
- Chapter 11: APP 11 Security of personal information , Office of the Australian Information Commissioner
- Essential Eight , Australian Signals Directorate
- Application Security Verification Standard , OWASP Foundation
- Web Content Accessibility Guidelines (WCAG) 2.2 , W3C
- Digital Service Standard , Digital Transformation Agency