Misc clarifications for CONTRIBUTING.md (#2401)

* Reorder and clarify dependency installation instructions

* Clarify instructions for local development with Docker external deps vs full Docker stack

* Final words at the end of the local setup process

---------

Co-authored-by: danswer-trial <danswer-trial@danswer-trials-MacBook-Pro.local>

CONTRIBUTING.md

@@ -56,9 +56,8 @@ Danswer being a fully functional app, relies on some external software, specific
 
 
 > **Note:**
-> This guide provides instructions to set up the Danswer specific services outside of Docker because it's easier for
-> development purposes. However, you can also use the containers and update with local changes by providing the
-> `--build` flag.
+> This guide provides instructions to build and run Danswer locally from source with Docker containers providing the above external software. We believe this combination is easier for
+> development purposes. If you prefer to use pre-built container images, we provide instructions on running the full Danswer stack within Docker below.
 
 
 ### Local Set Up
@@ -68,7 +67,7 @@ If using a lower version, modifications will have to be made to the code.
 If using a higher version, sometimes some libraries will not be available (i.e. we had problems with Tensorflow in the past with higher versions of python).
 
 
-#### Installing Requirements
+#### Backend: Python requirements
 Currently, we use pip and recommend creating a virtual environment.
 
 For convenience here's a command for it:
@@ -98,26 +97,24 @@ pip install -r danswer/backend/requirements/ee.txt
 pip install -r danswer/backend/requirements/model_server.txt
 ```
 
+Install Playwright for Python (headless browser required by the Web Connector)
 
-Install [Node.js and npm](https://docs.npmjs.com/downloading-and-installing-node-js-and-npm) for the frontend.
-Once the above is done, navigate to `danswer/web` run:
+In the activated Python virtualenv, install Playwright for Python by running:
 ```bash
-npm i
+playwright install
 ```
 
-Install Playwright (headless browser required by the Web Connector)
+You may have to deactivate and reactivate your virtualenv for `playwright` to appear on your path.
 
-> **Note:**
-> If you have just run the pip install, open a new terminal and source the python virtual-env again.
-> This will pull the updated PATH to include playwright
+#### Frontend: Node dependencies
 
-Then install Playwright by running:
+Install [Node.js and npm](https://docs.npmjs.com/downloading-and-installing-node-js-and-npm) for the frontend.
+Once the above is done, navigate to `danswer/web` run:
 ```bash
-playwright install
+npm i
 ```
 
-
-#### Dependent Docker Containers
+#### Docker containers for external software
 You will need Docker installed to run these containers.
 
 First navigate to `danswer/deployment/docker_compose`, then start up Postgres/Vespa/Redis with:
@@ -127,7 +124,7 @@ docker compose -f docker-compose.dev.yml -p danswer-stack up -d index relational
 (index refers to Vespa, relational_db refers to Postgres, and cache refers to Redis)
 
 
-#### Running Danswer
+#### Running Danswer locally
 To start the frontend, navigate to `danswer/web` and run:
 ```bash
 npm run dev
@@ -176,6 +173,36 @@ powershell -Command "
 > **Note:**
 > If you need finer logging, add the additional environment variable `LOG_LEVEL=DEBUG` to the relevant services.
 
+#### Wrapping up
+
+You should now have 4 servers running:
+
+- Web server
+- Backend API
+- Model server
+- Background jobs
+
+Now, visit `http://localhost:3000` in your browser. You should see the Danswer onboarding wizard where you can connect your external LLM provider to Danswer.
+
+You've successfully set up a local Danswer instance! 🏁
+
+#### Running the Danswer application in a container
+
+You can run the full Danswer application stack from pre-built images including all external software dependencies.
+
+Navigate to `danswer/deployment/docker_compose` and run:
+
+```bash
+docker compose up
+```
+
+After Docker pulls and starts these containers, navigate to `http://localhost:3000` to use Danswer.
+
+If you want to make changes to Danswer and run those changes in Docker, you can also build a local version of the Danswer container images that incorporates your changes like so:
+
+```bash
+docker compose up --build
+```
 
 ### Formatting and Linting
 #### Backend