Technology has advanced rapidly in recent years, and there are expert software development teams in many countries across the world. So, these days, companies can hire the talent they need without being limited by international boundaries.
This blog post delves into how a development team’s location influences the cost of software development. We’ll compare rates across regions and weigh the benefits and challenges of this type of outsourcing.
Outsourcing software development to another country can help businesses gain immediate access to a larger talent pool, whether they’re looking for developers, designers, analysts, project managers, quality assurance staff – or other IT-related professionals.
The main reason companies consider shifting software development offshore is to save money. And it’s certainly true that the location of your software development team plays a crucial role in your software development costs.
The cost of hiring a resource for software development is highest in the United States (US), and prices are exceptionally high in important commercial centres like New York and San Francisco. Conversely, the cost of hiring software developers in Latin American countries is relatively low. In recent years, prices in these countries have risen quite significantly.
However, many US-based companies still choose Latin-America-based teams for their software development. This is because while the costs are now higher than in other parts of the world, they are still considerably lower than in the US. In addition, it’s helpful that some Latin American countries operate in the same time zone as parts of the US. Furthermore, there are relatively few business etiquette differences between the US and most Latin American countries, and most Latin American IT professionals have good levels of English.
Similar to comparing the US and Latin America, the cost of software development services is higher in western European countries like the UK, France, and Germany compared to central and eastern European countries such as Poland and Hungary. In fact, many medium and large enterprises in western European countries use the development capabilities of Eastern European countries. It’s the perfect marriage, lots of technical talent, hourly rates are lower, more often than not there is a common language and time zones are, nearly always, the same.
In Asian countries such as India and the Philippines, software development services can be a whole lot more cost effective than in both Latin America and Eastern Europe. In the case of India, it’s important to remember that the cost of software development varies significantly between cities and states. Software development services will be relatively high in Tier-1 cities like Pune, Hyderabad, Mumbai, and Bangalore, which are the urbanised and industrialised. The costs will be less expensive in Tier-2 cities like Ahmedabad, Kochi, Trivandrum, and Noida. Meanwhile, Tier-3 cities like Surat, Vadodara, Bhubaneshwar, and Indore will likely offer clients the cheapest software development services.
Even though outsourcing software development to offshore companies or developers comes with many benefits, mostly related to costs, there are also challenges. Businesses may need help with communication due to the differences in time zones, languages, and culture. Your vetting process needs to be thorough and even after you think you’ve decided on a development partner you may want to have an interview style conversation to see if the collaboration will be a personal fit. I feel this is most important, the development partner may have good reviews, checked out well on Clutch.co, has great cast studies and a consistent LinkedIn profile, you still may not get along in terms of the way you work. For example, you may have heard of the term ‘Yes Men’, some like that, others absolutely loathe it! You will also need to remember that low-cost software development options may offer a lower quality of service, and the teams may be less experienced. So, it’s crucial to thoroughly vet your team before signing on the dotted line.
Satva Softech has a structure in place to overcome the issues with quality and cultural differences of outsourcing, whilst embracing the cost-saving benefits. All of our technical consulting specialists are based in the UK and US; project managers, product owners, scrum masters and other heads of projects. And we implement first-class quality control measures when recruiting our teams – in-house teams in UK, US and India. We can assure we offer all our clients first-class UK or US-style services at affordable rates. Your project lead will serve as the primary contact point, overseeing all the development processes carried out by our own in-house development team in India. This means you don’t have any additional pressures yet can reap all the benefits.
In the evolving landscape of global software development, a team’s location directly influences project costs because of regional wage disparities, time zones, and cultural nuances. While outsourcing provides considerable financial savings, it’s not without its challenges, particularly in communication and quality consistency. SATVA Softech navigates these complexities, bridging the gap with UK and US-based consulting and rigorous quality controls, ensuring quality service without the typical outsourcing hassles.
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Experts in Digital Transformation, Satva Softech help organisations embed systems and processes digitally and expand their business by creating transformational digital solutions.
