How To Work With An Offshore Software Development Company

Dec 02, 2022

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The tech industry is developing at a furious pace, but for many companies, the issue of lack of talents and funding remains critical. Very often, the best solution in such situations is the offshoring of development services.

In this article, we will consider the features of this type of cooperation and discuss how to choose the best partner for offshoring.

Looking for an offshore development company?

Experts claim that the size of the global IT services outsourcing market will reach more than 1,065 billion dollars by 2030. At the same time, offshoring remains the most popular type of outsourcing. In 2021, this segment had the highest revenue share of over 52%.

IT services outsourcing market share by location

IT services outsourcing market size

The best offshoring option is to sign a contract with a company that provides a dedicated team. It works within the framework of the corporate culture and the customer’s specific project. In fact, these specialists become part of the business and bring the same value as internal departments.

What are Offshore Software Development Services?

Offshore software development is an outsourcing type and approach when the vendor is a company located in a foreign country or even on another continent. Usually, the customer and the vendor are in time zones, with a difference of 8 or more hours.

The Benefits of Offshoring Development

Despite such inconvenience as the difference in time zones, offshore software development is extremely popular all over the world. All thanks to its advantages:

  • Costs Saving. Developers from different countries have different rates. For example,  the services of a mid-level specialist from Ukraine are often cheaper than the same-level engineer’s rate in the USA. That’s why the total cost of the project sometimes can already be significantly reduced simply due to the difference in the developer’s hourly rate.
  • Expertise. Offshore companies have close-knit teams with extensive expertise in UI/UX design, business analysis, web and mobile application development, etc.
  • Talents Diversity. Tech specialists from foreign countries help to cope with the talent shortage.
  • Flexibility. The customer can choose team composition, cooperation model, level of involvement, etc.

In addition, with proper management, which can be provided by the offshore company itself, all the disadvantages of this partnership format are eliminated.

When to Hire Offshore Developers

Offshore app development is a good solution for scaling the project with limited resources, as a dedicated team can strengthen your tech department. However, there are other reasons to choose this outsourcing development service model.

You’re Working Strictly Within Limited Budget

Offshore development is a great option when you need to cut operating expenses. In this case, you don’t have to pay office rent for the team, equipment, hiring costs, etc. In addition, this cooperation model allows you to hire the best specialists at lower rates without exceeding tight budget limits.

You Need to Reduce Development Time

Offshore vendors work within specific time frames. Their experience and coordination allow significantly speed up development time.

We at Leobit will be glad to become your offshoring partner.

Your Project Requires Specific Skills and Tech Stacks

Hiring highly specialized engineers to solve specific problems on a single project is expensive and unnecessary. Offshore companies give you access to the services of engineers with specific tech skills for a particular period to achieve precise goals. It is many times simpler and cheaper.

You can also hire an offshore team if you need help with project management and more time to focus on business needs.

5 Steps to Take Before Working with an Offshore Development Company

Offshoring a project requires some preparation, and here are its five main steps.

Step 1. Market and Target Audience Research

To begin with, you should define the target audience of your product, the markets you plan to take the lead on, and your software value.

Based on this data, try to research the offshore development services market: which companies have experience with the same products and can share your values? This helps narrow down the list of potential partners.

Step 2. Clarify Goals

The offshore development team is formed depending on the project goals, so they must be defined as accurately as possible. This way, it will be easier for you to find specialists with specific expertise and skills.

Step 3. Define Regulatory Compliance Requirements

Any app must meet the regulatory requirements of a specific industry and region. It can be HIPAA for healthcare, PSD2 for fintech, etc. Your offshore partner should be aware of these requirements and provide full compliance with them.

Step 4. Choose the Proper Cooperation Model

There are three main cooperation models:

  • fixed-price (fixed payment for the entire project);
  • dedicated team (hire a whole team that becomes part of the company and shares its interests);
  • time-and-materials (payment for development time, equipment, licenses, etc.).

Be sure to determine the key requirements for cooperation and choose the optimal model based on them.

Step 5. Define Communication Channels

Communication is key, so it’s essential to determine how often you want to receive reports, communicate with the offshore team and meet with management. You can also choose communication tools such as Slack.

How to Choose an Offshore Software Outsourcing Company

You can choose from hundreds of different offshore vendors, but your final choice should be attentive and thoughtful.

Companies Info and Reviews

The first thing you should pay attention to is general information about the company and its services. Browse the portfolio for projects similar to yours. You can also check some reviews on independent platforms, such as Clutch, GoodFirms, industry blogs, etc.

Demo Call

When you’ve chosen a few best options, request a consultation or a demo call so that company managers can tell you more about development services and special offers.

Don’t Forget About Your Interests

You must protect your interests, as cooperation with an offshore partner implies that the tried-party vendor will have access to critical corporate and confidential information. Therefore, do not forget about a non-disclosure agreement and a strong contract, where the tiniest details of cooperation will be spelled out.

Offshore Development Advantages Offered by Leobit

Leobit is a full-cycle development provider, so you get access to all the highest-quality development services. We’ve also been recognized as one of the 50 Smartest Companies of the Year 2022 and named one of the best software developers in Ukraine.

We have seven years of experience in outsourcing development and a solid team of high-level professionals for any project, including the most complex ones. So you can contact us to get more info about our services and expertise. We’ll be pleased to consult you in this regard.

Conclusion

IT services offshoring is a popular and profitable type of cooperation. It helps business owners access new talent with rare skills at lower operating costs.

We at Leobit will be glad to become your offshoring partner. Just contact us in a convenient way, and we will answer any of your questions.

Tetiana Paratsii
Tetiana Paratsii
Marketing Analyst at Leobit
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