Which Outsourcing Software Destination to Choose?
Today, a pressing necessity to digitize working processes and customer services urges businesses to search for ways to build their own solutions. Many companies opt for IT outsourcing as it helps companies to save up on development costs and quickly find necessary IT development resources.
Although IT outsourcing provides an extensive number of benefits, it can be rather challenging to choose the right outsourcing destination nowadays. There is an impressive variety of IT hubs around the world that provide diverse software development services at different price levels. In this comprehensive guide, we’ll look at the top outsourcing destinations and explain how to find a responsible and highly-qualified team of developers for building IT projects of any complexity.
Why Outsource Software Development?
Before we start with a detailed analysis of the best countries for outsourcing software development, let’s have a look at the main reasons why businesses prefer to outsource their IT projects.
- Lower Expenses
IT outsourcing vendors from different parts of the world offer various software development rates. The rates are determined by the economy, living costs, labor code, and many other reasons in a particular region. Therefore, businesses often turn to IT providers with much lower rates than in their location. For example, German businesses prefer to outsource their software development to nearshore countries like Poland or Belarus because the rates there are significantly lower than in Germany.
Moreover, when hiring an outsourcing software development team, companies pay only for the services which they really need and avoid extra expenses related to hiring in-house teams, e.g. employee benefits, medical insurance, vacation compensation, taxes, or buying IT equipment.
- Business Growth and Scalability
With a fully-equipped outsourcing software development team at their disposal, companies can free up their internal resources and employees, focusing them more on their core business processes. Above all, companies can quickly scale up and down their IT outsourcing teams depending on the speed of their business growth and seasonal peaks.
- Quick Access to IT Talent Pool
IT outsourcing vendors can quickly ramp up a team of software development specialists that will satisfy both technical and business requirements of the customer project. For example, SCAND with its vast experience working on customer projects can provide specialists of high technical level and great domain knowledge in various fields like banking and finance, healthcare, e-commerce, education, and logistics, etc. Therefore, businesses don’t have to spend time and effort searching for the right IT specialists, instead, they can quickly hire the needed developers from such IT outsourcing companies as SCAND.
- Best Tech Expertise
Outsourcing software development teams have to keep up with the latest trends in emerging technologies to provide their services efficiently and at a high level. Thus, many software developers who work in outsourcing companies have vast experience in creating diverse digital solutions and implementing the latest digital innovations such as IoT, Blockchain, AI, and others.
Therefore, those businesses that hire outsourcing IT teams can rest assured that their applications will be created in accordance with the latest software development trends and methodologies.
- Compliance with International Standards
A reliable IT outsourcing company should guarantee the high quality and security of the developed software and create digital solutions in accordance with international standards such as ISO 9001 and ISO 27001 to name a few. That’s why many IT outsourcing providers undergo the ISO certification process to comply with high industry standards. Our software development company SCAND is no exception.
Outsourcing Software Development Moves Nearshore
There is a wide range of regions around the world that provide IT outsourcing services.
However, the latest trend is to choose a nearshore location due to time zone differences, and the inability to manage teams that have a huge time collapse with the in-house team. Thus, the US companies prefer to outsource to Latin American countries like Brazil, Mexico, and Argentina. Japan, China, and Australia outsource to India, and Western Europe turns to Eastern European IT outsourcing providers.
Let’s have a look at which Eastern European countries are attractive nearshore locations for most Western European companies:
Eastern European countries comprise a dynamically developing IT hub with the IT services and software R&D market growing x4-5 times faster than the global average.
Ukraine is a rapidly growing IT hub in Eastern Europe whose IT export services exceeded $5 bln in 2020, growing by about 26% each year. The Ukrainian ICT market is considered to be the third-largest exporter of services in the country and includes 5,600++ companies with more than 200,000 IT specialists.
Poland is the leading Central and Eastern European (CEE) IT outsourcing market with the turnover reaching $2,087.6 mln in 2018 and expected $2,311.7 mln by 2021. It has the largest pool of IT specialists in the CEE region and a diverse IT ecosystem of startups, SMEs, and large enterprises.
The main tech hubs of Poland include Wroclaw, Krakow, Warsaw, Poznan, Lodz. Warsaw, the capital, was included in the top 10 tech cities with the best start-up environment and FDI performance. The country is ranked 40th among the easiest of doing business and has one of the highest numbers of BPO, SSC/GBS, IT, and R&D service centers in Eastern Europe. The major international investors in IT companies include Dell EMC, HP Inc, Lenovo, IBM, Apple, Cisco, Microsoft, Google, and others.
Belarus IT outsourcing sector is one of the major contributors to the Belarussian GDP, comprising 5.7% with 54,200 IT specialists and 1,500 IT companies. Most of the outsourcing services are provided to Western Europe.
Belarussian software developers are considered to be reliable and highly-qualified outsourcing partners. One of the recent Coursera researches revealed that Belarus is the leader among 35 countries in Europe in technological skills with top performance in computer programming, web, and mobile development.
Meanwhile, the Global Innovation Index 2021 by WIPO ranked Belarus the 37th in Knowledge and technology outputs, 93rd in Creative outputs, 11th in ICT services export, 16th in ICT access, and as the world leader in mobile app development.
The most popular programming languages among Belarusian developers are Java, C++, and Python. Meanwhile, the most sought industry specializations are FinTech, Healthcare, Education, Travel & Tourism.
Romania has the longest years of experience in IT outsourcing services, working for nearly 12 years in the international software development market. It’s one of the biggest tech hubs in Europe with 100,000 professional developers. According to The State of European Tech 2020 report, every 3,311 in 1,000 citizens in Romania is a software developer. That’s why many companies outs