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Everything you need to know about offshore software development

Learn all about offshore software development, how it works, and its benefits and drawbacks. Also, find the best countries for offshore services and the associated costs.

Talk to our Accounts director, Jeroen, to see if our ready-to-code offshore teams are a fit for you.

What is Offshore Software Development?

Offshore software development is a business process where a company outsources some or all of its software development to partner companies located in another country.

As a business owner, you can hire an individual developer or an entire offshore development team to serve as an extension of your business. Offshore outsourcing is valuable for companies looking to expand their technical team without worrying about hiring overheads.

You can easily scale up or down as needed.

Offshore vs Onshore Software Development

Onshore software development is the practice of hiring contractors who are based in the same country.

Less cost-effective as you have to pay them the same rate as your in-house developers.

Offshore software development refers to hiring contractors from different countries.

More cost-effective as you can hire developers from south-Asian countries like Nepal and the Philippines.

For more detailed differences, visit our blog post on onshore versus offshore development.

Benefits of Offshore Software Development

Here are some of the benefits of hiring an offshore team for your development needs:

Reduced costs

Most offshore companies are located in countries with lower living costs and favorable currency exchange rates. By outsourcing to these offshore companies, countries in North America and Western Europe can significantly reduce operational costs.

Additionally, outsourcing allows companies to avoid costs for recruiting, employee benefits, or any holiday time.

Access to the global talent pool

Offshore outsourcing allows you to choose professionals from a global talent pool as per your requirements at an affordable rate.

Easy scale up and down

You can either scale up or down as per your need without worrying about hiring overheads and severance packages.

Focus more time on your core capabilities

By hiring a self-managed development team, you can fully focus on your business, making product strategy and roadmap.

Learn more about the benefits of hiring an offshore development company.

Challenges of Offshore Software Development

Offshore development is a common practice nowadays, but it comes with certain challenges:

Time zone differences

While working with teams located in different time zones, you may need to rely on asynchronous communication, which can take some time.

Cultural influences

Some countries may have different working and communication styles, which might create problems with knowledge and requirement transfer.

Less control over hiring

Some offshore providers may try to increase profit margins by hiring lower-priced engineers, which can negatively impact the quality of their work.

Because of these challenges, choosing a good offshore partner is crucial. To avoid these challenges, make sure to vet your partner properly and look at their past experiences.

14+ years in offshore development.

Try our ready-to-code offshore teams.

Different steps involved in Offshore Software Development

Here are the basic steps to follow when starting with offshore hiring:

Identify your requirements

Determine the reason for needing offshore support, the type of expertise required, and how the team will need to work with your team.

Ask for recommendations

Seek advice from people who have worked with an offshore team and find out if they would recommend them.

Search trusted publications

Check online platforms and review sites for crowdsourced recommendations on reliable and skilled software development providers in your area of interest.

Choose your preferred region and time zone

Ideally, you want to be working with a team with some overlap in working hours for real-time communication when required.

Prepare a shortlist of candidates

Narrow down your options to two or three companies to interview.

Conduct interviews

Ask questions about the type of work, industry experience, working process, and typical project timeline. Ensure they understand your tech stack.

Sign the contract.

Best countries for Offshore Development

India 🇮🇳

India has one of the largest populations in the world, and the number of outsourcing software development locations is proportional.

Their education system focuses extensively on sciences and mathematics, with 2.6 million STEM graduates every year. The average rates span between $25 and $50 per hour.

Poland 🇵🇱

Competing with other countries in the region, Poland has a strong software landscape, with over 100 companies dedicated to software development.

The country is a member of multiple organizations (including NATO, WTO, and EU), which ensure that data is shared and stored safely. Rates span between $35 and $55 per hour.

Ukraine 🇺🇦

While in the midst of regional conflict, Ukraine is still one of the most popular countries for offshore software development.

They blend affordable rates ($30 to $55 per hour) with a wealth of expertise in many software areas and a high number of English speakers.

Argentina 🇦🇷

Largely serving North America, Argentina is one of the most educated countries in Latin America, with a budding software engineering space.

Companies in the country claim to have high retention rates, making them reliable partners. Rates range between $30 and $55 per hour.

Nepal 🇳🇵

Nepal has a comparatively low cost of labor, making outsourced software development relatively inexpensive at an average rate of $25 to $40 per hour.

The country also recently revitalized its education systems to prioritize digital skill sets. More than 5,000 university graduates go into the tech and business process outsourcing sectors every year.

For a more detailed overview, visit our blog on top countries for offshore software development.

Cost of Offshore Software Development

Offshore development costs can range from $25 to $200 per hour per developer, based on different factors such as:

location of the offshore company
project requirements
experience of the technical team

Check out our guide on offshore development rates by country and technology for a proper price comparison.

Tips for hiring Offshore Software Developers

Make sure to properly vet your offshore developers or the development company and look at their past records and case studies.

Clearly define your goals and set clear expectations and parameters. This will help the offshore team stay on track.

Share any necessary documentation with the team in a timely manner.

Work with the team to create a realistic project roadmap with specific milestones and a detailed list of requirements and specifications.

Establish clear communication protocols and tools, including how to handle time zone differences and asynchronous communication.

Provide timely and actionable feedback to keep the project on track.

Make sure to read our comprehensive guide before hiring offshore developers in 2024.

When is the best time to opt for Offshore Software Development?

The best time to hire an offshore development team depends on your business needs and requirements. However, it may be beneficial to consider hiring an outside team if:

Your projects need specific expertise that you don’t have in-house, consider hiring offshore talents.
Your startup needs to quickly scale its technical capabilities.
You want to add new features to your software without disrupting the current tasks of your in-house developers.
You have a limited budget but still want to compete in the market, by hiring teams from countries like Nepal and India, where you can access top-notch resources at a low cost.

PROSHORE - your Offshore Software Development Company

With over a decade of experience, Proshore is a leading offshore software development service provider from Nepal.

We offer a unique ready-to-code dev teams mode that starts with understanding your needs, taking ownership of the project, and managing developers, processes, and outputs such as milestones and deliverables.

We ensure a smooth development process so that you can focus on your business strategies – let’s discuss your requirements over a 15-minute call.

If you’re looking for specialized offshore development services, you can also choose from our vast tech expertise:

Looking to hire offshore developers?

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