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What Is Offshore Software Development? How It Is Beneficial For Your Business?

What Is Offshore Software Development? How It Is Beneficial For Your Business?

Building a digital firm is a difficult process, made more difficult by growing expenses, rapidly changing software technology, and more fierce competition. As a result, many businesses-startups included-look to offshore software development to help them achieve their objectives. The worldwide IT outsourcing industry is anticipated to reach $413.7 billion by 2021. An increasing number of companies are relying on offshore software development services in an effort to reduce expenses and maximise cooperation.

Software Development Performed Abroad

Software Development Performed Abroad

“Offshoring” is the practice of outsourcing the creation of software or applications to a third-party provider in a separate nation. Offshore developers are located in a different time zone than the customer, which makes it difficult for them to meet the client’s deadlines.

Offshore software outsourcing provides startups with a number of advantages, including lower costs and a faster time to market. It’s not only about constructing a new app from scratch when it comes to using offshore development services. Back-end development, user experience design, and app development are all examples of services provided by developers.

This includes Dollar Shave Club, an American company, which hired our Ukrainian-based team to build additional features for its mobile application. The time difference between the United States and Ukraine makes this a kind of offshore outsourcing.

Software Development Statistics For Offshore Projects

Software Development Statistics For Offshore Projects

According to Deloitte’s 2020 Global Outsourcing Survey, outsourcing is robust activity in the face of the global pandemic problem. According to the findings, 70 percent of those surveyed said that cutting costs was the primary motivator for outsourcing. Outsourcing aids in enabling cloud technologies, according to 68% of respondents, according to Deloitte.

Future software outsourcing demand is likely to rise. ManpowerGroup estimates that in 2019, 69% of US organisations would have difficulty finding and recruiting qualified employees, with IT specialists ranking as one of the most difficult to locate. 67% of UK tech executives believe that a lack of tech skills is disturbing momentum. UK companies are likewise encountering the same difficulties.

For And Against Offshore Programming

Western countries are searching for low-cost, high-talent offshore software development firms because of a shortage of skilled workers in their own countries. An offshore IT development organisation is a good option if you know what you’re getting yourself into.

Read More: How to Hire Offshore Web And Mobile App Developers?

Benefits Of Software Development Done Offshore

Benefits Of Software Development Done Offshore

The following are some of the advantages of outsourcing software development to a foreign country.

  • To Save Money: Lower development expenses are achieved without sacrificing quality by using software engineers located in countries with lower living costs. Consider how much a US firm has to spend for a developer’s salary to get a better sense of how much you can save. US software developers make $97,763 per year on average, whereas in Ukraine the same job only brings in $36,000. This information comes from Glassdoor.
  • Scalability: Having a huge staff of engineers on a monthly payment, especially if they’re idle, was too much for startups to bear. Using offshore, you’ll be able to choose the expertise, the number of developers, and the duration of the partnership. Depending on your business’s demands, you may either scale up or down. It also means that you don’t have to worry about the costs of social benefits, health insurance, and other advantages that come with employing people in another country.
Software development services
  • Hire From A Wide Range Of Candidates: When it comes to creating software, it takes a multidisciplinary team of IT specialists. For certain types of software, it may be difficult to locate local applicants with the skills you need. As a result of outsourcing, you obtain access to a worldwide IT talent pool. From top IT outsourcing locations, you’re sure to discover the ideal individual, whether you’re looking for Node.js experts or programmers with lesser-known languages.
  • It’s Time To Go Back To Business: Offshoring allows the co-founders to spend more time focusing on the company’s core functions. Instead of learning new IT skills or dabbling in programming, the founding team may focus on public relations, marketing, and other aspects of getting the product to market.

Offshore Software Development Has Many Drawbacks

Offshore Software Development Has Many Drawbacks

There are certain downsides to offshore software outsourcing, but the benefits far outweigh them.

  • Time Zone And Cultural Differences: Hire Offshore Developers in nations far away from your own might represent a big difference in time zone and culture because of offshore. Working with software developers in China will need you to adjust to a time difference of 12 hours. Many Chinese coders are not proficient in English, making this more difficult.
  • Managing The Dangers: Effective communication between your team and the outsourced vendor is critical to the success of outsourcing. Prior to the commencement of the project, the project requirements, milestones, progress reports, testing, and other essential paperwork must be agreed upon.
  • Transparency Is Lacking: You have no influence over how the software is developed by the external vendor, which is a significant disadvantage when compared to working with an internal offshore software development team. It’s also unlikely that you have any say in how the vendor handles sensitive data or how they keep their developers focused on a single aim. As a result, certain IT companies, like Uptech, maintain open lines of communication to help reduce the likelihood of misunderstandings and mistrust.

An Offshore Development Team: How To Manage It

An Offshore Development Team: How To Manage It

Working with an overseas team isn’t easy, but if you’ve built the right groundwork, it’s doable. We have a list of tasks that must be completed.

  • Decide On Your Objectives: Before contacting suppliers, you need to know what ui ux Design Services you’re looking for. Are you seeking a group of developers that can create an app from the ground up that you can hire on an as-needed basis? Or are you looking for help with an existing app’s user interface (UX)? Choosing the right companion is essential to a successful relationship. It’s now time to look for possible service providers that have the necessary expertise to perform the job. Additionally, the provider must show that they are knowledgeable about your industry. As a result, you may be certain that the vendor’s software development will adhere closely to your company’s objectives.
  • Decide On The Best Way To Work: Time and material, set pricing, or a specialised team are some of the cooperation possibilities available from offshore software developers. There are advantages and disadvantages to every design. The long-term nature of the project necessitates the use of a committed crew. There are advantages and disadvantages to both fixed pricing and time and material for short-term projects with well-specified criteria.
  • Decide On A Method Of Communication: Communication between an offshore IT provider and its customer is the key to a successful relationship. Slack, Jira, Zoom, Figma, and Miro are just a few of the technologies we use at Uptech to stay in touch with our customers.
  • Make A Recommendation: To keep the outsourced developers on track, it’s essential to arrange regular check-ins when the customer is informed of their progress. Observe if the developers are on the correct track, and then provide constructive suggestions.
  • In Order To Succeed, You Must Work Together As A Team: Working with a wide variety of customers, I can attest that a strong partnership between vendor and client is essential for outsourcing success. When working with an outsourced developer, you’ll need to treat them as if they were part of your own team.

Read more: 5 Important Considerations For Extending Offshore Software Development Team

A List Of The Best Countries To Outsource Software Development

A List Of The Best Countries To Outsource Software Development

When looking for an outsourced software development firm, where should you look? Many nations across the globe are fighting for a place on the favourite outsourcing destination list because of the worldwide need for IT knowledge.

  • Ukraine: If you’re looking for Eastern European developers to outsource to, Ukraine is your best choice. More than 200,000 Ukrainians work in the IT industry, and the country’s economy is heavily reliant on outsourcing. Reputable businesses routinely highlight the country as a good location for IT outsourcing.
  • India: With more than 5 million software engineers, India has established itself as Asia’s leading outsourcing destination. Despite its cheap hourly rates, the nation has a number of challenges, including cultural differences and a lack of confidence in the product’s quality.
  • Argentina: As a result of strong government backing and high-quality education, notably in the field of technology, Argentina has become the favoured outsourcing destination in Latin America. The nation’s lower wage rate and cultural resemblance to US-based clientele are also driving the IT outsourcing business in the country.

Cost Of Offshore Software Development

Despite the fact that offshore software development is often less expensive. The resources required for a given project might vary greatly. As a result, it is hard to estimate the cost of developing a certain piece of software. The cost of developing a software application in Ukraine ranges from $50,000 to $250,000, according to our experience.


Software development will increasingly be done abroad in the near future, according to all the evidence. This arrangement is especially beneficial to small businesses, such as start-ups. In this article, we’ve shown how to locate the best IT outsourcing service provider and how to choose one.

Also, we’ve shown how we’ve been a major software outsourcing firm in Ukraine and how we’ve assisted a number of small businesses. Talk to us to find out how we can help your startup by using our staff of highly qualified software engineers.

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Written by Atman Rathod

Atman Rathod is the Founding Director at CMARIX InfoTech, a leading web and mobile app development company with 17+ years of experience. Having travelled to 38+ countries globally and provided more than $40m USD of software services, he is actively working with Startups, SMEs and Corporations utilizing technology to provide business transformation.

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