Extensive Review of Programming Outsourcing: Everything That You Should Know
Whether you have a startup or a big-size company, you need to find quality employees to realize your vision. Currently, programming outsourcing is a surefire way for businesses that operate globally. It helps to build flawless software solutions, substantially cut cost overheads, and save other business resources. You do not need to seek in-house employees and can select a remote team with the finest specialists. In the review, let’s look at the main features, nuances, and benefits of programming outsourcing.
What Is Programming Outsourcing?
Traditionally, an idea to outsource programming means delegating services to external specialists in app or software development. Since we live in a global, digitalized world, startups and large companies can collaborate with expert programmers from different countries around the world. Thus, business owners have more opportunities to develop quality software while reducing recruiting and onboarding costs and saving on taxes and office space.
Although the considerable development of software outsourcing is directly related to COVID-19, this approach became popular 8-10 years before the pandemic. International companies usually prefer to outsource development to such countries as Romania, Ukraine, and Poland to order IT outsourcing.
For instance, according to Radix statistics, in 2024, 66% of businesses in the USA delegate at least one department to European and Asian companies. Besides, the Radix website notes that over 300,000 jobs in North America are outsourced each year.
Previously, India was in the lead for software outsourcing, but in recent years, Eastern European companies have been delivering more quality products and showing more work discipline and engagement.
Suppose you want to outrun your competition in time and outsmart them in costs. In that case, outsourcing programming will allow you to jumpstart your project, strengthen your position in the business area, boost your startup value, and create a unique app or website without writing a line of code. It can help you save money without worrying about constantly searching and hiring IT specialists.
A List of Tech Tasks You May Delegate
When it comes to outsourcing programming services, you can delegate a wide range of tasks, depending on your business needs. We have listed the basic options below:
- Mobile applications and desktop software outsourcing;
- Website development and additional support;
- UX/UI design;
- Progressive web apps (PWAs);
- Various management systems (CRMs, ERPs, EHRs);
- Testing and software QA;
- Backend development (server-side software).
Of course, you can discuss other programming work for your business goals and needs with your chosen outsourcing agency.
Types of Programming Outsourcing
There are three common types of IT outsourcing, depending on how far from you is the team to which you delegate your project. It is a balancing act to choose the right one, so check this list for details.
Offshore Outsourcing
This form involves hiring a company or several specialists who are geographically distant from you. For example, if you are in Canada, you can cooperate with Ukraine. The main factors are the quality of services and company experience. Still, you should consider the time zone and differences in mentality. Although this outsourcing type is the cheapest solution, several pitfalls are hidden here.
Namely, keep in mind that you will have only 2-3 hours to be in touch with your outsourced team and can’t control their work closely. Therefore, you need to hire a reliable Project Manager or Team Lead to build effective and systematic communication.
Nearshoring
It is a middle ground between the other two types. In this case, you may consider cooperation with a service provider in a neighboring or bordering country. For example, you can efficiently outsource software development to companies in Portugal if you live in Spain.
This solution envisages similar cultural values and no or slight time difference, which will not exceed 1-2 hours. It positively affects successful communication and project management. Also, you may count on reasonable prices.
Onshoring
This form envisages hiring an agency or specialists from the same country where your business is located. Namely, if you work in the USA, you can cooperate with a company from America as well.
Such an approach includes the possibility of communicating with the team for at least 70% of the working day. It makes interaction more accessible and minimizes the project manager’s work. Yet, the onshoring type costs much more than the two previous options if you live in the USA, Canada, or Western Europe.
Have a project idea you’d like to bring to life? Our team of talented developers and testers are readily available at your service
Top-Rated Models of IT Outsourcing for Business
Speaking of cooperation models of programming outsourcing, there are several of the most popular options. If you have a project to delegate, you can select a time and material model, a fixed-price contract, or hire a dedicated team. Let’s discover the features of each option below.
Time and Material Outsourcing Model
This type of programming outsourcing will be an excellent solution when you have no idea about the future product scale and cannot predict the necessary budget. So, you order particular services from an outsourced company, paying for the hourly rates of the developers. The price can flexibly change according to the new project demands, software requirements, and priorities.
This model has a few points to consider. In particular, if you hire a dishonest contractor, you may spend much more than you planned. Sadly, some companies might willfully delay the project development to squeeze more funds from the client. A great solution is splitting tasks into several parts (or subprojects) and paying for them gradually. Besides, you should not overlook the control of managers’ work.
Fixed Price Per Project
As a client, you turn to the outsourcing agency with your ideas, goals, and wishes for your project, and the specialists offer reasonable solutions with fixed prices. Clearly, you should discuss and agree on the whole project cost and deadlines before the development launch.
This outsourcing model will be a godsend if you and the contractor/manager ultimately realize a list of the necessary IT services. So, we advise allocating more time for the discovery phase. It is carried out to get the project requirements list and learn the main functions, goals, and desirable platforms for the new project.
The next step will be the specification. It includes preparing a document containing the product characteristics, its technical description, development tasks, and a detailed explanation of the work to be done. Eventually, at the end of this phase, the development team must estimate in detail the time required for implementation and the final development cost.
Keep in mind that this outsourcing model does not feature flexibility at all. If you want to change some project details, you should discuss it with the outsourcing manager and renegotiate the contract and the price.
Hiring a Dedicated Team
This model of IT outsourcing implies long-term cooperation with a dedicated team formed primarily for the client’s needs. Thus, the contractor provides developers, QA engineers, web designers, and other employees. You get a unique team with special skills for particular tasks. As a rule, this model works either on a subscription model or according to the hourly rates of each team member.
A reputable outsourcing partner can bring experience and best practices to the table, helping to mitigate risks associated with development, such as missed deadlines, scope creep, and budget overruns. As a business owner, you don’t need to think about the development process, hiring employees, starting the onboarding process, etc. You simply hire an assembled, highly skilled team that gets the work done.
Essential Benefits Of Outsourcing Relationship
The benefits of outsourcing are not limited to saving money and the ability to tap into an almost unlimited talent pool. You can figure out the essential pluses of outsourcing in the list below:
- Business flexibility. You can expand the team according to the business growth, change the project, or add new tasks. Whatever idea comes up to you, it can be quickly implemented by cooperating with the outsourcing company. Then, if it does not work, you may simply close the project without a long-term commitment to hired employees.
- Money saving. Successful outsourcing significantly saves your budget compared to creating the software by an in-house team. When cooperating with outsourcing partners, you do not need to spend money on work equipment, search for office space, pay wages, and suffer additional expenses.
- Programming outsourcing solutions for ideas of any size. No matter what project type you want to create: a small application or a potentially colossal eCommerce platform. You can delegate software development according to your needs and goals, and scale or downsize the team at any time.
- Time saving. You don’t waste time assembling an effective team or searching for specialists, their training, and growth. In addition, you will not worry about managing the project yourself, which also takes a lot of time. You can focus on your business goals and save time for other needs.
- No need for recruiter work. As you delegate software development to professional companies, you don’t need to hire a recruiter, saving your budget and time on candidate searching.
- Access to the cream of the crop tech specialists. Your geographic location does not limit you when you seek a global team. You can find the finest talents with flawless digital skills for efficient product development.
So, you may count on empowering startups with programming outsourcing due to cooperation with a team of highly skilled specialists. It’s a great way to get the finished product according to your requirements and receive groundbreaking ideas and fresh views of your business.
Pitfalls Involving Outsourcing
Outsourcing may also include some risks for business owners. Although this solution has a plethora of advantages, you should realize possible issues when you delegate your programming projects. You can familiarize yourself with the pitfalls below in the list:
- Poor communication with the team. The issue is especially prominent if it involves the offshore outsourcing type. Due to the time zone differences, you will have only 2-3 hours to discuss the necessary tasks or issues.
- Partnering with dishonest agencies. Sadly, some companies aim to get more money from customers than to deliver a result. If you see that the cooperation terms are delayed and tasks are performed slowly, consider reviewing the contract or hiring another agency.
- Excessive costs. Although outsourcing will significantly save your budget, you may spend more than you intended. It can happen if you do not plan your expenses correctly.
The solution to all these risks is hiring a reputable company with a good project manager. The PM will control the process, ensure that the developers understand your requirements, and communicate with the team. The manager must be in touch with the client at the indicated time, provide reports, discuss the next stages of development, etc.
Programming outsourcing is one of the most effective solutions if you immediately discuss the desired results with the developers. After all, it sometimes happens that business owners have inflated expectations and requirements that do not match the results obtained. Explain the expected quality to the outsourcing provider and prepare a document with product features and a detailed estimate of the development to avoid such misunderstandings.
How to Get Started with Outsource Programming: In-Depth Guide
As it can be challenging for newcomers to find the best outsourcing companies, we have prepared detailed instructions that can help you.
Define Your Business Requirements
It may seem obvious that you must specify a list of services you need at the initial stage of project development. However, based on our experience, most business owners forget about this nuance. The requirements for the development team always depend on the business goals. For example, if you are just kicking off your startup and want to test an idea to see if it can be turned into a profitable business, you probably need an MVP. Companies that already have their products usually require improvement and maintenance services.
As you can see, the goals and needs for outsourcing software development differ according to the current business status (whether it is a new app, top-rated website, or online platform lacking results). By writing a list of the services you want to receive, you can forecast the necessary budget.
Stick With the Necessary Outsourcing Model
You should select the outsourcing type before starting cooperation. As mentioned, you may choose from onshoring, nearshoring, or offshoring services. Beyond that, you should select the outsourcing model. Namely, if you already have a product and require specific services, selecting the time and material model is reasonable.
In contrast, hiring a dedicated team may be profitable if you need to create a project from scratch and hope for long-term cooperation. Our qualified team can propose exclusive digital solutions and create a whole product or specific features according to your desires and possibilities.
Pick a Country For Software Development Outsourcing
Nowadays, you can hire outsourced developers from different countries. Keep in mind that the destination has a substantial impact on the final results, workers’ productivity, and communication possibilities. As mentioned, the onshoring type is considered the most straightforward option for better communication but has the highest price. In contrast, the offshore option can be cheaper, but working with foreign specialists without language knowledge may provoke additional issues and misunderstandings. The middle ground is nearshoring as it has small-time differences and enables reasonable prices.
Consider outsourcing programming to Eastern Europe, which is one of the front-runners in this area. European businesses frequently prefer to outsource projects to companies and freelancers from Ukraine, Poland, Romania, and other Eastern countries due to their talented IT specialists and professional working culture.
Find the Company and Verify Its Experience
When you have picked a country, you should look for programming outsourcing companies there. Unconditionally, you can use word of mouth and ask your friends or partners. Still, visiting and researching tech blogs and exploring various outsourcing vendors to find the finest ones is better. Namely, look at online platforms like Clutch, Tech Behemoths, and LinkedIn.
Obviously, you need to explore the previous programming activities of the chosen company or freelance developer. Find the agency’s official website, check out past projects, client reviews, and a list of services. Then, move to the next stage.
Conduct Interviews and Hire a Company
In most cases, development outsourcing is a long-term engagement. Therefore, you should closely communicate with potential candidates and make video calls with developers and/or project managers to realize their professionalism and expertise. Small and medium-sized businesses can speak directly with IT specialists, designers, and other candidates.
Finally, when you find a suitable team, you can hire an outsourcing firm for cooperation. You need to discuss the rules and deadlines, ensure both sides are satisfied with the terms, and kick off collaboration.
What Affects the Price of Outsourcing Programming Services?
Since IT outsourcing is not a product but a technical and creative process, the cost depends on the numerous facets. When it comes to cooperation with freelancers, the prices can be lower than when you hire programming companies. Nonetheless, not all freelancers may be organized and punctual, so it makes sense to cooperate with a qualified company. Here, we listed the primary facets that affect the price of programming services:
- Outsourcing model. As we mentioned above, there are several cooperation models, and each comes with its own prices, either fixed or flexible.
- Tech tasks and the project score. Logically, the price of the tasks’ execution depends on their amount and complexity.
- The number of employees. In most cases, the cost depends on the number of IT developers involved in the programming development process.
Also, the price of outsourced programming depends on the specialists’ qualifications and experience. It goes without saying that newcomers may provide lower prices than seasoned developers. Still, we recommend preferring quality and reliability over cheap price.
What price can one expect for the implementation of their project? Here are some examples:
- Landing Page: $500 – $5,000. The factors influencing cost are the complexity of design, interactivity, responsiveness, and additional features.
- E-commerce Website: $5,000 – $50,000. The factors influencing cost are the number of products, payment gateway integration, security features, design complexity, and scalability.
- Custom Platform: $20,000 – $200,000+. The price depends on the features, functionalities, integrations, user roles, scalability, and complexity of the development process.
Overall, the average price per hour for middle-level developers is $30 – $100, but it strongly depends on the requirements, tech stack, expertise, and location of the developers.
When you hire us, you have the flexibility to choose the collaboration model that best suits the needs of your business
Well-Known Brands That Outsource Programming
Outsourcing is the right choice for famous and well-established companies as well. Let’s read the review below to find out the four top-rated brands that prefer to delegate software services.
Besides California’s central office and in-house team members, the company is considered a leader in IT outsourcing. Google hires specialists worldwide to delegate numerous tasks and substantially save their budget. For instance, the brand delegates email support, client communication, phone assistance, IT services, etc.
Apple
This brand is a global leader in technical innovations, including the mobile industry, music, computing, etc. Apple has clients worldwide and a market capitalization of over $2 trillion in 2020. Company managers work on their projects, concentrate on branding, create groundbreaking ideas, and search for the newest solutions. Meanwhile, many different tasks involved in building software or app development and other technical jobs are delegated to developers across the USA and Asia.
Amazon
This brand is a giant marketplace focusing on real goods sales worldwide. Moreover, the company provides various services like e-commerce, digital streaming, and cloud computing. Amazon prefers outsourcing to operate quickly and cost-effectively, saving budget and time. In most cases, this company outsources such tasks as PPC management, SEO, product listing, bookkeeping, graphic design, and more to outsource companies.
Microsoft
Microsoft is also one of the most successful companies that benefit from outsourcing. Brand owners aim to optimize administrative costs, reduce computing resources, and concentrate on developing the main product. As we know, Microsoft is working with a company from India to reduce IT support costs.
Meta
What would you say if you learned that Meta’s success and growth are tied to a reasonable outsourcing journey strategy? Thus, the well-known brand has delegated software development to other companies and specialists, significantly saving costs. Although Meta had a small team of specialists at the beginning of its activity, it became a powerful international brand in technology and innovative solutions due to outsourcing.
Do/ Don’t in Programming Outsourcing
Do:
- Indicate the necessary project specifications, strategies, and desired results.
- Create a detailed plan with the final product features.
Closely look for a development company you can start collaborating with. - Determine your criteria for effective communication and discuss how to achieve it with the selected team.
- Have meetings with the project manager regularly to monitor the project development process.
Don’t:
- Do not hire the first outsourcing company you’ve had an interview with: take time for the market research.
- Do not delegate something you are already excellent at. Still, you can boost your team by hiring dedicated developers if you’re running out of resources or deadlines.
So, Why Should You Outsource Programming?
IT outsourcing is a top-notch solution. It is a lucrative choice for startups and enterprises that want to create high-quality software or apps through proven strategies and with the newest ideas. You can delegate IT-related services to 3rd-party vendors, counting on favorable development time and cost.
At QArea, it all starts with a discovery phase, analyzing unknowns in the project and checking the business goals and needs. Then, we discuss the scope of work for the upcoming months and start cooperation.
Well-established companies and startups have the potential to grow faster with programming outsourcing and get numerous benefits like time-saving, budget savings, and fresh ideas from experienced programmers. Our team guarantees high-quality software development based on impact-driven flow and a product-oriented mindset. Regardless of whether you are only starting your business or have some experience in the market, we will provide profitable solutions for achieving your desired goals.
Share:
- What Is Programming Outsourcing?
- A List of Tech Tasks You May Delegate
- Types of Programming Outsourcing
- Top-Rated Models of IT Outsourcing for Business
- Essential Benefits Of Outsourcing Relationship
- How to Get Started with Outsource Programming: In-Depth Guide
- What Affects the Price of Outsourcing Programming Services?
- Well-Known Brands That Outsource Programming
- Do/ Don’t in Programming Outsourcing
- So, Why Should You Outsource Programming?
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