Offshore Development Company: What Is It and How to Choose One?
Working with outsourcing and offshore development companies can help a business save on costs. Know how to choose which one best fits your organization.
One of the biggest struggles companies face is reconciling their costs of product development with their output.
The hope generally being that the output will far outweigh the costs. But sometimes, the internal cost is too overwhelming to be compatible with a profitable venture. This is why offshore developers and development companies have become important.
What is an Offshore Development Company?
In simple terms, an offshore software development company is a subsidiary, typically located in a different country with a dedicated team for software development. Usually, the offshore company is in a country with more favorable operation costs, like cheap labor and low tax rates.
Who Needs an Offshore Development Company?
The biggest number of companies that bear the difference in time zones and use offshore software development services mostly deal with big data projects, especially in tech and precision products.
Most fortune 500 companies will use a development team from a company offshore for their technology solutions. This is because these have expensive production processes and need specialized world-class front-end developers. These developers may not be found easily except in particular places across the globe.
Here are examples of technology businesses that need to do their development services offshore to thrive in their industries:
- Computer tech companies such as Apple have offshored most of their web and mobile app development and manufacture into China and India.
- Software companies such as CISCO have a good portion of their front-end development, especially UI UX design and other software development offshore.
- Automotive companies, financial corporations, electronics companies, telecom companies (especially for their mobile applications), and e-commerce companies can likewise offshore their businesses.
We build custom software with modern solutions in mind for any business and sizes!
We build custom software with modern solutions in mind for any business and sizes!
Costs for Offshore Development
One of the biggest reasons companies decide to do their development offshore with outsourcing companies is the cost convenience. Software engineers and developers from different places have different charges and costs. Some places are cheaper than others.
According to YouTeam, Asia is the cheapest region to set up your offshore software development center, followed by Africa and Eastern Europe. Here’s a quick look at the hourly rates worldwide.
How to Choose the Right Offshore Software Development Company
Deciding on an offshore outsourcing software development company is not a small task. The right offshore outsourcing company will set you up with the best development centers and bring you the right software developers.
So where do you start looking for offshore development services to set up your offshore software development outsourcing?
1. Define what you want
Before looking for software companies, it is crucial to define what you want to achieve, keeping in mind the details. State as clearly what you want to achieve from the partnership. The company can only build a sound and effective offshore team when they know exactly what you're looking for.
Some questions to ask:
- What kind of development process do you need?
- What kind of design development do you intend to achieve?
- What will it involve?
- Do you need to build a mobile application?
- Does it require a web application? Or artificial intelligence and machine learning?
- What development software products do you want to use?
2. Look for demonstrable experience
The best way to know that a company can get you the results is by looking at their track record. Find the company with the most demonstrable experience in outsourcing offshore development with clients worldwide.
And that has had the most success in the past with your particular kind of project. That company is most likely going to have the best shot at delivering a suitable software development team for your project.
3. Request for a proposal
At this step, you're not just looking for a company that services offshore software development. You're also looking for project management capabilities and costs.
Request a proposal from the project manager of your prospective offshore companies so you can compare different companies. This allows you to eventually come down to an affordable company with sound management capability and quality assurance.
4. Evaluate cost-effectiveness
Cost-effectiveness means whether or not it is productive to the cost. The hope here is that you will land a company that can put together a team of developers at a cheap rate but remains effective. Make sure to do an evaluation check before selecting an offshore company.
5. Prioritize long term goals and strategy
While hitting short-term milestones is no doubt important, you want to prioritize long-term goals. Here's why:
Setting up an offshore development center makes most financial sense in the long term capacity. It takes time to train and integrate the offshore development team into your system.
Therefore, it is important to draw up a strategy for a long-term partnership with your offshore development teams. This is to be able to select the right company with the right chemistry for the best long-term results.
6. Support and maintenance after delivery
It is important to make sure your offshore company has a good after-delivery support and maintenance system.
This is particularly crucial for software companies because they require constant monitoring and updating. Make sure the company you select will be able to stay on top of your support and maintenance requirements.
Conclusion
Finding a good software company to outsource to is no easy task. But there are also some software development companies, like Laneways Software & Digital, that provide custom software solutions that are at par with the top offshore software development companies. Whether your needs are to do front-end or back-end development, you can also get results for software outsourcing, custom software development, or cloud-based solutions, aside from web development or application development.
Don’t forget to take time to get the details and weigh your options before deciding on the offshore company for your business.
We build custom software with modern solutions in mind for any business and sizes!
We build custom software with modern solutions in mind for any business and sizes!
Jerome Rault
Partner with a software development team one that's passionate about creating success
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