How much does a Magento website cost?

How much does a Magento website cost?

The inside scoop on how much your Magento 2 site will likely cost to build.

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Website owners want to get a feeling for how much Magento costs build a website on. This article is not a sales pitch, but rather an aggregation of our experience and conversations with others in the industry. This is the most comprehensive document on the internet detailing this subject. We have organized it into sections so you can find the information that is the most pertinent to your needs.

Summary: generally speaking, you get what you pay for.

Summary: for $50,000 (ideal entry point) you should expect:

  • A basic, yet solid Magento Community Edition, version 2, website.
  • Customized theme.
  • A number of pre-built installed extensions to boost the capabilities of your website.
  • Several website customizations beyond the installed modules.

Jump To Detailed Sections:



Summary:

The presiding guideline in the Magento development community among agencies is to not share Magento pricing or pricing tiers on their websites. The reason for this is simple: every installation and project is unique. There are no two identical projects. There are no two identical agencies. One agency might utilize offshore developers, while another might be based out of Los Angeles. Another agency might be a Magento Gold Partner, only working with Magento, while yet another agency might offer Magento as one of many services and platforms.

We present pricing from our perspective. At the end of each pricing section are modifiers for larger agencies/offshoring/freelancers. As a reference, our small agency (such as SwiftOtter.com):

  • 5 employees
  • Remote developers (i.e. low overhead)
  • Magento certified developers
  • Based out of Kansas City (reasonable cost of living)
  • Not yet a Magento partner (but working towards this goal)

Some more information about the $50,000 ideal entry point - from a small agency perspective:

  • A basic, yet solid Magento Community Edition, version 2, website.
  • Customized theme.
  • A number of pre-built installed extensions to boost the capabilities of your website.
  • Several website customizations beyond the installed modules.

Additional Details:

  • Custom-written integrations with external Customer Relationship Managers (such as SalesForce) or ERP can add $10K-20K or more. If an off-the-shelf solution exists, it could be half the price.
  • We often charge the price of an extension for installation. This might sound like a lot, so please read the module installation section.
  • Using Commerce (formerly Enterprise Edition) could add $0 (nothing) to the price of the project (above the yearly fees paid to Magento)

Larger Agencies/Offshoring:

In our experience, many larger agencies have an entry point of $75k - $100k. Offshore might save you 50-75% of the project cost (see the section on this). Freelance developers will likely reduce project costs compared to a large agency but might not bring the same speed of completion.

As a reminder, these prices are a guideline based on our experience.




$20,000 - $50,000

Time: usually 1 month or less

This is considered the entry point for a Magento website. At this price, there is very little added to Magento in the form of additional functionality. This price point primarily focuses on the basics and default settings/adjustments.

Keep in mind that Magento by itself does work very well as an ecommerce platform. You will have to accept Magento’s way for most everything. For some customers this is much easier to do than it is for others.

At this price point, you can expect:

  • A basic design, very similar to the default Magento Luma theme.
    • Yet there should be some customizations beyond simply changing out the logo and default colors.
  • The use of a modern styling system (SASS)
  • A modern deployment system
    • Even as you start at a lower price point, investing in this system (which we are continually working to lower the cost of entry) helps ensure that you will have quick and easy code deployments as updates are made.
  • Assistance with the migration process.
    • The time available for this will be limited to a fairly small amount (but agencies want to see you happy).
  • (possible) Migration of data from an existing system.
    • This should be possible if you are converting from Magento 1 to Magento 2.
    • If you are migrating from another platform, this may or may not be possible.



$50,000 - $75,000

Time: usually 1-2 months of development (yet launch time will often be longer due to data entry).

This is the entry point for most builds. While sacrificing some features could lower the price, it is important to understand you might not be happy with the result. There is a lot of development that goes into making Magento exactly right for your store.

At this price point, you can expect:

  • A somewhat custom look and feel (as compared to the default Magento Luma theme (http://magento2-demo.nexcess.net/)
    • The benefit here is that your site will appear more unique because it differs from the default Magento theme. It will be more customized to your customer’s views and expectations of what your site should look like and will be more polished.
    • Theme work is often one of the most time-consuming elements of the project.
    • There will likely be custom features that are built to facilitate parts of the design.
    • Compatible with the latest FireFox, Chrome and IE 11+
    • Tested in multiple browsers to ensure it looks good (although it may not look exactly the same).
  • 3-5 off-the-shelf modules to extend existing functionality. Here are some examples:
    • Order Attribute (by Amasty): this extension allows you to add order comments to the checkout process. The benefit is that your customers can provide you with special shipping information, or even a note thanking you for the products you offer.
    • Google Shopping Feed
    • Mirasvit Blog
  • Help with the migration process.
    • This is a big and often underestimated. Magento is complex. Especially if you are coming from a different commerce platform, you will appreciate assistance in learning and understanding Magento to customize it to your needs.
  • The use of a modern styling system (SASS)
    • This is the language of the future for styling your website. Magento 2 ships with LESS which is fairly obsolete. By building on top of SASS (which can take a little longer) ensures your site will be more future-proof.
  • A modern deployment system
    • This allows your agency to quickly deploy code. Less problems, easier, repeatable. Migration of old data from an existing system (Magento provides a utility that provides most of this functionality).
  • You will be responsible for necessary data entry.

Larger Agencies/Offshoring:

Larger agencies will typically be 10%-50%+ and possibly longer lead time with the benefit being their breadth of experience. They might also not accept a project starting in this price range. Offshoring might save 50% but expect to spend significantly more time specifying project details and the project time could be 2-4x times slower (see the section in detail below). Freelancers should be able to handle projects of this size as long as they are not undertaking too many other clients.




$75,000 - $150,000

Time: usually 2-4 months of development time

This is the mid-tier of Magento website builds and brings more flexibility and creative liberty to ensure that the website is finely tuned to customer needs.

For this price point, you can expect:

  • More-detailed discovery phase to ascertain the requested features and their scope.
  • A very custom look and feel to the website.
  • User testing to ensure that the new look and feel of your website resonates with your customers (pseudo-insurance).
  • Significant custom features developed. These will likely be to facilitate your unique business processes, or extend / streamline the customer-facing capabilities.
  • ERP integration
  • Additional SEO monitoring and advice through the migration process.

Larger Agencies/Offshoring:

This project tier seems to be a good entry point for Larger Agencies. Projects of this size should exercise caution with Offshoring: while the savings are enticing due to the larger project size, that same larger project size (i.e. increased complexity) will make the overall project harder to manage (see the section in detail below). When working with a Freelancer on a project of this size your team may need to do additional work or the Freelancer may need to hire on some help.



$150,000+

Time: 4+ months of development time

At this price, most of the website is likely to be custom. Here are a few things that you might be considering:

  • Super, lightning fast frontend built on a modern JavaScript framework. This boosts your customer’s experience as they browse your site, making them want to come back. grove.com is an excellent example of such a user interface.
  • A custom product designer (t-shirts, custom sizing or measurements)
  • Extensive search-engine optimization planning and unique considerations

A project of this size is a complicated undertaking requiring competent project management and efficient development processes.




What goes into building a Magento website?

Putting together a Magento website can take hundreds or even thousands of hours. While development is a part of it, there are many other "trades" that come together to make an excellent product:

  • Client Interaction:
    this is often underestimated by the client, but this interaction does take time. Agencies are not charities and do have to be compensated for this time in one way or another.
  • Strategy:
    knowing how you want your website to act, who are your customers and how you are going to market them is exceptionally important. Consider this the roadmap for the rest of the project.
  • Design:
    having a beautiful website that is tailored for your customers helps you sell more product.
  • Feature Development:
    this is what most think of as building a Magento website. This involves reviewing and installing extensions and writing the customized code to give your website the features that your customers need.
  • Theme Development:
    this phase involves making your website look beautiful. We use the Magento 2 Luma theme (actually, a derivative of that) which provides a reasonable foundation.
  • Quality Assurance (Testing):
    while developers do their best to write bug-free code, we know that developers are human and errors do creep in. This phase is extremely important to make sure that your agency catches the problems before you or your customers find them.
  • Data Migration:
    moving your existing products, categories, CMS pages and blocks, customers, orders and store configuration over to the new website.
  • Data Entry:
    customers often like to handle this one. This involves setting up the new data for products, and writing text to go onto the website.


What is a discovery phase?

This is a mini-project in which the upcoming project is researched. It might account for 10% of the overall project cost. It is most often billed as it can make or break a project. Requirements are gathered, the scope is defined and negotiated, and a process is put in place.

It might seem like an additional piece of the project that can be done away with to reduce project costs, but it is often essential. This gets the plan or roadmap in place for the project.




How much does a Magento 1 to Magento 2 migration cost?

Unfortunately, there is not a one-click Magento 1 to Magento 2 upgrade. There is a significant financial investment to transition from Magento 1 to Magento 2. How much is that investment? The more code that can be directly copied from M1 to M2 means more savings.

Our experience is that a Magento migration from version 1 to version 2 costs 50-75% of a new Magento build.

Here is what can be copied from Magento 1 to Magento 2

  • The database: Magento’s database migration tool works ok. There can be some issues throughout the process. Please note that a migration will result in some downtime during the website launch while orders and customers are copied from the M1 site into the M2 database format..

Here is what can be partially copied from Magento 1 to Magento 2

  • Custom code that you have built. We can copy the idea and much of the structure. There are many differences to M2’s core code, so this has to also be taken into account..

Here is what can NOT be copied from Magento 1 to Magento 2

  • Custom modules. These are usually very different from M1 to M2. These will need to be repurchased. At this time, the marketplace is still catching up to the changes in M2, and not all modules will be available. These modules will need to be custom-built.
  • The theme. Magento 2’s base theme is a complete rewrite. This is where most of the work is involved in a migration. We also take this as a time to upgrade your Magento build to the latest web technology standards, yielding a codebase that is as future-proof as possible.

These migrations are treated with the same level of concern as a new website build. In most every way, it is the same process.




Can items be removed from the minimum entry point to reduce cost?

This is a tricky question. Agencies want to see their clients happy. Clients want to be happy. Clients also want to reduce their costs in every way possible. Agencies know this and often bend over backwards to reduce costs.

In our experience, there is a minimum level of functionality delivered to make a happy client.

What’s more is that every client is different and has their own picture of the perfect website that they want.

Example: an easy one that clients might want removed is some of the support hours. Maybe the client is technical, or maybe they are on a shoestring budget. Either way, the support hours are removed and the project commences. How would it work if near the end of the project, the client needs extra support? It puts the agency in a difficult position as they are either going to lose money on the project or make the client unhappy. Neither is a winning position.

That said, the biggest thing that we have found to reduce the entry point cost is history. As an agency gets to know their client better, they know what the client truly expects and what they are ok with foregoing. For us, we have had some Magento 2 builds that our entry point was significantly less than listed above, and that worked well, for others, the price was $50k or more and we maxed it out.




Offshore saving? Benefits?

Choosing a partner to build your website is difficult. Comparing partners to build your website is even harder. How do you compare agencies?

We hear regularly that using offshore labor to complete a task can involve a savings of 50-75%. This means you could likely be quoted $15,000 - $25,000 for the same rough requirements. For some companies, the savings benefits are exactly what they need to get a website delivered.

There are many success stories and, sadly, disaster stories with using offshore labor. Our view is that some companies can afford that risk while others can’t.

What is the risk? We believe the risk lies in these areas:

  • The ability for communication
  • The skill and qualifications of the developers
  • Your ability to draft an ultra-comprehensive detailed description of the work to be performed

Communication

This one is the greatest risk. In America and many Western countries, we natively speak English. Offshores developers do speak English: some well and some not so well. Effectively communicating your project requirements and the continued discussions through the project are very important to keep the project running smoothly.

In cases of project disaster, communication is usually cited as the primary reason.

Developer Skill

How skilled is the developer? This applies for any developer. Anyone can hang out a “Magento Developer” shingle and not know the unique areas of the system. This goes back to your research of the developer and their development practices: are the developers certified? Are there peer code reviews? What type of QA mechanism do they have? What about the release process?

Another thing to consider relates to communication. English is pretty much the de facto programming language. The consideration here is how well does the developer speak English? The ability to communicate through code and comments is very important.




How much does Commerce (formerly Enterprise Edition / EE) add to a project’s price?

At the implementation level, Commerce adds $0 to a project.

You can install Commerce for just the yearly fee paid to Magento (see next section for info). There is no additional development required to release a site running Commerce.

That said, many customers who wish to deploy a Magento Commerce site need extra features. This is because their business process dictates integrations, unique customer experiences and more. This is likely why other websites state that Commerce builds start around 50% more then an Open Source (formerly Community Edition) build.

Commerce brings to the table a host of useful features (see here). You should read through this list to see how Commerce can benefit your site.

How much does the annual Magento Commerce licensing fee cost?

The yearly licensing fee paid to Magento for Commerce was previously a flat fee per server instance. Magento 2 changed the licensing fee structure to a fee tied to annual website sales volume. This makes Commerce an affordable option for websites with low volume, while still remaining competitively priced for larger eCommerce sites. Price quotes and demos for Magento Commerce are easy to get, simply contact Magento directly (and please tell them that SwiftOtter sent you).




How much does it cost to install modules?

Besides introducing security vulnerabilities, the Magento Extension Downloader has given a false sense of ease for installing extensions. You would be surprised with the number of extensions that have extremely poor-quality code, potential security vulnerabilities and/or send requests back to the developers servers.

With the release of Magento 2, Magento introduced the Magento Marketplace for Extensions (replacing version 1's Magento Connect). The process for submitting an extension was also overhauled to increase the quality of extensions/modules (4 things Developers must know to sell Magento 2 extensions via the Marketplace).

To install a module, we usually charge the price of the module + that price again (a minimum of $300).

How much do modules cost?

Module pricing has steeply increased with Magento 2. Unfortunately, our experience is that the quality has not commensurately improved. That said, many modules range from $200-$400 per Magento instance.

Here’s what our process involves:

  • Purchase the module.
  • Download and install it on a developer’s local environment (a close replica of what your site looks like on the server).
  • Review line-by-line the code of every file. We are looking for security vulnerabilities, sending data back to the developer’s website, creating unauthorized “back-doors” into your site for others to access information and more. This would also include patching those problems.
  • Review that the basic advertised functionality exists.
  • Upload to the staging site.
  • Ensure that the module is installed and is working as expected.

Additionally, many clients want customizations to how the module behaves. This is charged on top of the module install fees.




What might be the lowest possible cost to install a vanilla Magento build?

$1,000 - $2,000. This is literally to begin renting a server at a host of your choosing (our recommendation is MageMojo), download Magento onto the server and install it.

There are some serious limitations to this approach:

  • No code versioning: there are no code backups of this approach so you can go back in time and see what modifications were made, when and by whom. We use GitHub for this.
  • Updating the site will likely result in minutes of downtime.
  • If you do actual development on this machine, you will likely have more errors and downtime. This wouldn't be considered an option in a production environment.

The next step up is to setup a staging server. This allows you to test your code and then copy it to the production server. But how do you do that?

  • Version control: there still will be quite a bit of downtime with Magento 2 as you pull down code updates and build it.
  • Copy (scp): very error-prone, takes a lot of time to complete, likely downtime with the synchronization process.

At this point, the price goes up initially, but saves much money in the long-term. The solution we use is something we built in-house: automated code delivery to your server(s). This allows great reliability and speed when getting code to your website.

As such, we do not recommend this approach unless it is for a minimal, short-lived proof of concept.




Ongoing maintenance costs?

This is an area that is difficult to estimate. One might think that with a good developer, the monthly costs of maintenance will be $0. We have found that a good developer reduces maintenance, often by many times, but there will always be continued needs.

For example:

  • Site patches: Magento is regularly coming out with patches and bug fixes (Magento 1 averaged 2-3 a year, while Magento 2 is often 1 a month). When installing the patch, the site needs to be tested to ensure that nothing has broken. Figure on an average of $100-150 a month.
  • Ongoing education and training.
  • Feature enhancements: many store owners like things customized to their preferences and usage. It could be small enhancements, or installing a module.
  • Bug fixes: no matter how good a developer or how good the QA, there will always be bug fixes that are required.

There is no “average” with our customers. Some need little assistance with their site, and we primarily handle patches with their annual cost running about $1,000 or so. Others are continually innovating and tuning their website to higher revenue producing levels and pay $50,000+ a year.




How much should it cost to patch a Magento website?

Installing Magento patches can vary from a very quick update to a multiple-hour ordeal. Here are some complicating or mitigating factors:

  • Do you have SSH access?
    • “Command Prompt” into your server. This allows your developer to quickly apply the new Magento patch.
  • Have there been core hacks made?
    • Core hacks is changing core (code written by Magento) code instead of properly building modules to accomplish the same thing.
    • This makes it very difficult to apply patches as the patch has trouble determining where to be applied.
  • Have there been local overrides made?
    • Developers copying core code into another folder: this results in the core file being patched, but not the code that was copied into another folder. There are certain cases where there is no other option but to do this, but that is rare.
    • This makes troubleshooting after the fact difficult. The patch might have been applied, but it doesn’t take effect.
  • Are you on an automated build system?
    • If so, patching is a very quick update.
  • What version of Magento are you running?
    • Version 1 can be more intense to update as it was easier to edit the core.
    • Version 2 is much more command-line dependent and thus most websites running version 2 should have SSH access. Additionally, it can be easier to update, but will result in more downtime, unless you have an automated build system.

For reference, we charge $200-400 to apply most patches. This can go up in cases like SUPEE-9767 and SUPEE-8788 which were patches that required more work to apply.

What goes into applying the patch?

  • Review: search for the patch on Mage StackExchange to see what problems others are having with applying the patch. Review the updates in the patch. Be careful as Magento, Inc. has had a bad track record with Magento 1 patches lately: they have released numerous “version 2” patches, doubling the time for updates.
  • Database backup: unless the patch is extremely basic, we always backup the database.
  • File backup: ensure that there are daily backups being run. This is a favor to clients as a server outage could result in major loss otherwise.
  • Applying the patch:
    • If you do not have SSH, this means downloading the website, applying the patch on your computer, and then uploading the files again. Git is an excellent helper in this as it will show you what files you need to re-upload.
    • If you have SSH, you upload the patch to the server and apply it.
  • Test the website: run through the checkout process (add to cart to the “thank you for your order page”). Ensure that customers can register, that you can reset a forgotten password and that your contact forms still work.
  • Please note: the above steps should be first completed on your staging / development website and THEN on your production website.



Why not just use an “off-the-shelf” theme for $100?

As you are aware, Magento is not WordPress. WordPress has “taken the cake” across the industry for a platform that is very modular. WordPress is a very different product targeted for a very different use. WordPress has thousands of themes available—whether they are quality or not would depend on the developer creating them.

Magento 2 also has quite a few themes available. It isn’t as many as WordPress. I can’t speak for all of their quality, but in general, themes for Magento tend to be very low quality. They often introduce bloat, which makes your website slower for your customers (read this article). They often don’t use correct coding standards. Many of them might not be compatible with the devices that your customers use. It often is difficult to extend and build on top of their CSS (the style sheets that make your website look nice).

That said, theme implementation accounts for the large share of building a website. There might be some developers who might be fine with installing a theme and calling it a day.

If you find a theme you like:

  • Talk about it with your developer to get their thoughts.
  • Ask them to do a code review on the theme to give you in-depth and informed feedback about the quality of the theme that you chose.
  • Be prepared that it might not save you much in the long run. As your website grows, you likely will want to customize it and make it your own. Starting with a pre-built theme might not be the long-term best option.



How much does hosting cost?

Doing a search for “cheap Magento hosting” yields about 120,000 results. Searching instead for “expensive Magento hosting” yields 589,000 results. If there really are 700,000 options (which there are not), how do you know who to go with and how much it will cost?

Site speed is an exceptionally important issue.

If your website is slow, you will drive customers from your website. As you speed up your website (to a certain point), you should see your conversion rate go up and your bounce rate go down.

We have tried the $5/mo hosting plans an experiment. They barely worked without anyone visiting the website, let alone people actually visiting the site. Don’t go with this option.

MageMojo.com is our recommended hosting resource:

  • They primarily host Magento, so they are very familiar with supporting this platform with its intricacies.
  • They are lightning fast with website speed and support.
  • Dedicated instances: you aren’t sharing with other websites that will slow down your website.
  • Their support staff is knowledgable and friendly.
  • Their servers are finely tuned to running Magento.
  • Their admin panel is exactly what developers need.
  • For free, they will migrate over your Magento store from another host onto their servers.

Their hosting plans start at $59 a month which is a bargain considering what that price level brings (this website is using Magento 2 and is hosted on the MageMojo Advanced plan (https://magemojo.com/magento/dedicated-hosting).

If you would like some other options, here are a few:

  • Nexcess: they have some great Magento plans, but they are not “Magento-only”. Our experience is limited, but we haven’t had any problems.
  • (Europe) Byte.nl: I have heard very good things about them. They host the famous website, MageReport.com, which has been a huge service to many people, giving information about whether or not their Magento website needs to be patched.

It is important to talk to the hosting company and make yourself comfortable with their people and their support agreements. After all, where your website is hosted is key in keeping your revenue coming in the door.




Summary:

SwiftOtter, Inc.
It relates to Magento 2.
Joseph Maxwell - president / senior developer at Swift Otter

President / senior developer at SwiftOtter - @josephmaxs