How much does it cost to design a product?

Price is an important factor also when choosing a service provider for expert services, but for some reason, this information often cannot be found on the service providers’ websites. There is no price information on Optotec’s website either. But why not?

The answer is simple: setting list prices for product development services is not possible because product development projects are so different. Whereas a massage therapist can relatively easily define the price for an hour’s massage, it is far more complicated to price a product development project. Sure, even in such projects, the price is usually based on a specific hourly rate, but the total sum depends on various factors. 

When a customer with a product idea asks us how much it would cost to design the product, we can basically never give them a straight answer. Simply put, the customer pays us for the expert’s time and expertise. How much time and expertise is required to design a particular product depends on the nature of both the product and the project. 

In this blog article, we will discuss some of the most critical factors in terms of pricing: 

    1. The nature and requirements of the product. 
    2. The nature and scope of the project. 
    3. Pricing model. 
    4. Funding solutions. 


1. The nature and requirements of the product

How much it costs to design a specific product depends not only on the nature of the product but also on the customer’s expectations regarding the design work. A simple single-component product is usually easier and faster to design than a complex multi-component product.

How much time and expertise designing a specific product requires also depends on the requirements for the product, such as the intended use or manufacturing method. Developing some products may require, for example, expertise in standards or more massive testing than others. This takes more time and makes the total price of the project higher.

It also affects the price whether the goal of the design project is to design a prototype or a fully production-ready product. Designing a mere prototype is naturally faster than designing a commercial product ready for mass production.

2. The nature and scope of the project

Another thing that is significant in terms of the total price of a design project is the project’s nature and scope, i.e., how comprehensive, challenging and urgent the project is. In other words, to give a price estimate for a product development project, we need to know what the price is supposed to contain, what kind of and how many experts are needed and what the schedule for the project is. Smaller projects that only comprehend mechanical design can often be done by one mechanical designer; some more extensive product development projects may require an entire team of designers and many kinds of expertise. If the project is urgent, this may require dividing the design work among several designers or working overtime. These naturally make the price tag of the project bigger.

3. Pricing model

The total price of a product development project may also depend on the pricing model used in the project. Most design projects are done with an hour-based pricing model, but sometimes a fixed-price contract is also possible. 


To make a fixed-price offer for a design project, the engineering office needs to have a good idea of the project’s workload. Due to the nature of product development, making accurate workload estimates is often challenging. To minimise the risk of exceeding the estimated workload we add a certain margin to the price of a fixed-price project.

Furthermore, making a fixed-price offer means closing the requirements and the content of the project already at the offer-making stage. In practice, this may reduce the flexibility and add the amount of bureaucracy in situations where the requirements change, resulting in potential extra costs. Thus, a fixed-price project is often more expensive and less flexible for the customer than an hourly-priced.

4. Funding solutions

The price of a product development project also depends on whether or not there is outside funding available. Optotec is a service provider for Business Finland’s innovation voucher and ELY Centre’s Business Development Services. If the customer has access to the innovation voucher, they only have to pay 1,000 euros for a 5,000-euro-project, which means a considerable saving.

For more information about the eligibility criteria for the innovation voucher, go to Information about the ELY Centre’s funding is available at

If you have a product idea and wonder how much designing the product would cost, don’t hesitate to contact us. Together, we will go through the details of the product and the project, the pricing model and the possible funding solutions, after which we will make you an offer. The offer is non-binding, so you can take your time to familiarise yourself with it and then decide whether you are ready to proceed to the next stage with your product idea. 

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