Outsourcing to a software developer is the best way to bring on software development as a service to existing clients or for your own business needs. Businesses can cut costs associated with hiring full-time developers and reap the advantages of tapping into high-talent markets.
Many businesses outsource their software development, but finding the right match for your needs can be difficult. Sometimes these business relationships don’t work out; regardless, it’s best to find the right developer to partner with and stick with them for the long-haul.
Businesses can outsource to a developer within their region, a developer in a nearby region or a similar timezone, or a developer overseas. While outsourcing allows companies to hire a highly rated developer anywhere in the world, there are some caveats to that.
If you’re thinking of outsourcing, you’ll want to weigh the pros and cons. In this article, we’ll touch on the differences between hiring developers offshore and outsourcing developers nearshore.
Benefits of Outsourcing Software Development
Businesses consider outsourcing for software development to introduce new digital technologies to their workflow or services offered. Outsourcing this service is extremely common since it is cheaper than bringing on someone to work full-time for a business.d
Whether you are a major brand or a small business, outsourcing software dev has its benefits.
- Save money and still get high-quality software projects developed for your team
- Access a wide range of highly skilled developers available worldwide
- Acquire unique skillsets for custom projects
- Improve scalability and flexibility trends, especially in SMBs
- Improve productivity by adding intuitive software or take coding projects away from business employees
- Improve workflow
You can hire an independent contractor, a small agency, or a full in-house team. You might consider hiring someone “onshore,” which means someone within your region. Usually, this
means that you’ll pay a much higher price than hiring someone outside of your area. The estimated cost for hiring onshore is around 2 to 3 times higher. This will come with regional taxes as well.
Hiring onshore isn’t always the most affordable but can make for a fruitful business relationship. This is especially true if you need to meet face-to-face or if digitizing your business is not altogether feasible. You’ll have more in-person contact opportunities with an onshore developer.
What are Nearshore Developers?
You can also consider hiring a nearshore developer. Nearshore is a mixture between onshore and offshore. Typically it refers to someone within your same time-zone, but it might also be someone in a neighboring country so that the distance between your businesses doesn’t affect workflow as much.
Businesses can still reap the benefits of outsourcing with nearshore, including cutting costs, scalability, and accessing some top-developers.
There are significant benefits to hiring nearshore. You don’t have to compromise completely as you would with offshore development. Instead, you can work with another developer within the same time zone or with a minimal difference.
In these scenarios, communications might be improved. You might find that the changes you need are completed faster, and you can meet face-to-face if need be.
What are Offshore Developers?
As the name suggests, offshore developers are developers hired overseas. This type of developer is usually in a significantly different time zone than you and on a different continent.
This is the most commonly used type of outsourcing model because of significant cost benefits. Hiring offshore gives businesses access to top-rated developers, uninterrupted workflows, and better scalability. Some disadvantages come with hiring offshore; this might include:
- Low productivity due to the time zone differences
- Lack of project management
- Poor communication
- The inability to properly vet, validate, or confirm developer and projects
- A lack of control over the project
- Needing to hire multiple teams for multiple project types
Hiring offshore isn’t all bad news. If you are prepared for this type of business relationship, things can run relatively smoothly. There is some work to be done, including setting up a project management system to plan out and organize your relationships.
This is a small price to pay compared to the actual and significant cost savings. Many regions throughout the world charge lower app development fees, and since these individuals live in areas where the cost of living is less, you can reap the benefits.
You’ll also find that the talent pool is pretty competitive. You’ll be able to hire extremely talented developers at discounted prices. Your software development will be extremely good, and you will be able to scale your business better.
Nearshore Developers vs. Offshore Developers
We can’t say which model is right for your business. However, we can offer insight into why you might choose one over the other.
The simple way to go about this dilemma is to hire one nearshore developer and one offshore developer. This way, you can see what it might be like to work with these developers daily. In testing these outsourcing types, you’ll want to see if your company can handle some of the potential issues that crop up, like communication issues, connecting software for project management, project management flows, following timelines, and coding quality.
There are clear benefits to hiring both types of developers, but it depends on your business needs. If you have the budget, then you might be able to invest more into hiring nearshore. With both types of developers, you can hire a freelancer or an agency. Of course, an agency will be a bit more money, but the agency rate often far outweighs the hassle of dealing with an independent contractor and managing the project in-house.
Consider the following items:
- Freelancers and offshore outsourcing are typically cheaper
- Freelancers might be less organized or less able to manage project timelines
- Nearshore outsourcing may be more streamlined based on cultural similarities
- Nearshore outsourcing may not have the range of talent per price that you are looking for
- Offshore outsourcing will help you scale faster
- Offshore outsourcing can still produce high-quality software
As you can see, deciding on outsourcing will depend on your needs. Both have significant advantages, and both allow your business to scale while also implementing software development into your stack.
If you’re still unsure, reach out to the software developers and business consultants at Rotate. We can guide you in making the right decisions for your brand!