Learning Management Systems have become an integral part of every enterprise be it from an eLearning point of view or employee training purposes. Every business is moving towards robust and customized LMS and hence, it is really significant for new players in the market to understand how much does LMS development costs and how they can get the best deals on the same. Sure, every LMS development company has its own defined criteria for developing the system which means the cost of development varies from vendor to vendor. Some of these might give a steal deal on LMSs while the pricing of others may seem like they are trying to steal from you. The confusion is always there about whether you want a robust system with no compromises at a fair price or you are willing to cut the quality down while maintaining the costs as per your budget.

Well, the core reason behind such confusion is the lack of knowledge. Yes, you need to first research the market completely before you make the decision to go for an LMS solutions service. The confusing part is the showed prices that entice businesses. These prices often range from 0 to thousands of dollars however looks can always be deceiving. The LMS platforms have a certain pricing structure that often costs more than what they claimed in the beginning. There are upfront costs, service costs, subscription fees, etc. All these packages often become confusing and hence in this post, let us try to simplify and understand exactly how much does an LMS development cost and what are features you can get at the basic costs. We will also be taking a look at the pricing structure so make sure you read it carefully as this pricing guide can come in handy for you when you look for a change in the current LMS or you are new and looking for a better deal in the market. Without further ado, let’s begin!

What is the Need for an LMS? Why Look for Options? Factors Affecting the Cost

As you are already aware, the world is consistently moving towards an online way of living and hence, learning is one of the most impacted fields due o this change. There can hardly be any enterprise that does not require to train their employees before they onboard them on the project. Think about schools and universities that suffer due to lower physical attendance post-pandemic? Every sector of the world requires a suitable and centralized learning experience and an LMS can help in creating one. The need for learning content management systems arises when there are no other options available for an enterprise to enhance and manage its joiners and onboarding process.

This might come as a surprise but as per research, 44% of the total population that uses an LMS is not happy with the performance in fact 28 % of them have shown clear dislike of the current system that they work on. That is why people tend to look for options and that is where the knowledge of pricing comes into play. 

Usually, an LMS cost depends on certain factors that must be considered before you actually choose the option you want to go with. There are LMS systems that boast that they are absolutely free for use. Or you might have seen many systems priced below $100. Well, the price is shown in the box or the price that these LMSs promote is the hard cost that you have to pay upfront. It is never an all-inclusive cost and hence you have to be very critical while going through the ordering process. These costs are licensing fees that one has to pay before buying the product. The range for this fee as of now is $0 – $20,000 depending on many other factors such as –

  1. Pay Per Use: A user can opt to pay for every use. This cost range from >$1  to 10$ per course per learner.
  2. Pay Per Course: This is one of the most common models that eLearning platforms go for. The users pay for the courses they want to study.
  3. Pay Per User: This is a subscription model which means every user that enrolls has to pay and they have complete access to the courses.
  4. Setup Fee: Creating a customized experience for your user comes at a cost and that cost is known as a setup fee. This usually is fixed somewhere around $5000 for the cloud-based LMS while personalized in-house LMS can go up to $25000.
  5. Maintenance: You need to have an administrator who keeps track that the LMS is functioning well. These can be hired in-house as well as you can pay the company for the same. It does add a bit more to how much your LMS will cost you.
  6. Training: When you go for a self-hosted LMS, you will need to train your employees on how to operate and make the most out of the system. In the case of cloud LMS too, you will need to take at least 2-3 orientation classes from the service provider which will add to the cost.
  7. Miscellaneous Expenses: Adding more features or customizing the existing ones can also add to the overall licensing of the platform. 

Other than these factors the prices of an LMS depend vastly on the purpose for which it will be used. If it is for a limited environment i.e. an office, an organization, or a business, the prices may vary as compared to complete commercial eLearning platforms that need high bandwidth and will have more visits. 

Learning Management System: The Pricing Guide & How Features Affect them?

The models and other factors mentioned above can be tricky to understand but are clear indicators that it is not easy to understand the accurate pricing of an LMS as you do not register for the system, it’s the entire package, from LMS to training sessions. You have to be careful while evaluating the price plan you want to go for as the decision requires to be made boldly. For instance, for a budding enterprise that is low on budget, go with an LMS that shows the lowest hard cost (upfront cost). Logically when you are buying things, the cheapest catches your eyes first however, in LMS pricing, the hard cost is the least of your problems as the point of concern is the hidden cost.  Suppose there are 2 LMS systems one costs $500 (hard cost) while the other costs $15000 (hard cost). Your first instinct is to go for the one priced at $500 as it seems cheap however, you do not know what are the hidden costs for that LMS. eventually, when all the factors mentioned above combine, the overall cost of the product may exceed the $15000 mark which is insane to say but true.

Paying a large amount of money upfront may seem a bit too much however you can never defeat the fact that the hidden costs of an LMS are inversely proportional to the hard cost which means the more you pay upfront the fewer hidden charges you face and vice versa. The pricing guide also often depends on customization and features that you want to include. Some of the features that may cost you more when you add them are – 

  1. Multiple Authoring Tools
  2. Gamification
  3. Salesforce Integration 
  4. Auto-Enrollment Through CRM 
  5. Multiple Format Support for Content

Other than these there can be customizations that are specific to your business and hence these also fall into the overall costing. The pricing guide so far clearly states that the more you want the more you have to pay. eLearning software development companies often make it their priority to ensure that the customer gets what they deserve and hence the costs always differ from business to business. 

In Conclusion 

After going through all the points, one thing that emerges brightly is the fact that the LMS market is full of uncertainties and hence the price you pay for your learning management system might depend on the quality that you choose along with the features that you choose to go with. The unpredictability in the nature of pricing might be confusing and hence, the best bet for you is to choose a highly competitive IT consulting company to help you develop a robust and cost-effective learning management system Hope this helps you in making a decision. Good luck!

Author’s Bio:  Scarlett works with the editorial team of A3logics, a leading company offering  Mobile App Development. Exploring the latest technologies, reading about them, and writing her views have always been her passion. She seeks new opportunities to express her opinions, explore technological advancements, and document the details. You can always find her enjoying books or articles about varied topics or jotting down her ideas in a notebook.