Focused on the growth of your core business and you have some extra projects that need to be done. After much research, you’ve decided that outsourcing is the best path for you to go. However, the question in your mind remains, “Should I apply onshore, offshore, or nearshore outsourcing”
Once you’ve decided to take the road of outsourcing. It is time to decide from which part of the world you want to outsource your software development. In my experience, there are pros and cons in terms of quality and pricing when outsourcing to different parts of the world. However, there are other factors to consider, and I have found that the best bang for the buck has been in the nearshore world, and here is why.
Offshore, onshore, nearshore outsourcing – what shore?!
Offshore, onshore, nearshore – you must have heard these buzzwords many times. But do you know what they stand for? Before we dive into the topic, let’s get a better grasp of these concepts.
If your answer is “yes” – well-done. If you are not sure or just suppose which “shore” is the “off”, “on”, or “near” – don’t worry. You are definitely not the only one.
So, let’s start with an explanation, to be sure that we are on the same track we will take the U.S. as the starting point. In this context, onshore outsourcing means that you’re hiring freelancers in your own country.
Offshore stands for outsourcing software development from the countries that are overseas (in Eastern or Southern Europe, and Asia). These are usually in different time zones.
Nearshore covers outsourcing from the bordering countries, or from those which are a short distance away. In relation to North America, it is Latin America, with Argentina, Mexico, Brazil, and Colombia the top countries for nearshore outsourcing IT services.
Nearshore outsourcing – not the cheapest, but the best decision
In our previous blog post about the average rates for outsourced developers around the world, you could read that on the outsourcing market the rates in Latin America are somewhere in the middle – far from the most expensive, but neither among the cheapest.
Saving is important, but usually, it is not the only decision point.
In this blog post, we’re focusing on nearshore software development outsourcing, and listing the main reasons why exactly nearshore outsourcing is the best option for North American companies.
Why is nearshore outsourcing the best cost-efficient option?
Here are five reasons why Latin American countries offer the best ratio between cost and received benefits of outsourcing:
When you’re at work, your outsourced team is working as well. It means that you can organize conference calls and have real-time communication. You can calculate when all involved team members have their normal working hours or are at least awake.
Outsourcing offshore typically results in having to deal with working in a different time zone.
If you need to meet your software development team face-to-face from time to time, or all of a sudden. Then it is definitely more practical if your freelancers are located within short distance travel. Thus you can travel without planning much, or even go there and back the same day.
Fluent English language skills
Even if the English language is usually well spoken by professionals all over the world. Nearshore countries possess proficiency in English. No thinking “what the author meant”, or repeating the same thing too many times to be understood 100%.
Don’t underestimate cultural affinity when outsourcing your software development team. Similar to language proficiency, cultural affinity is crucial for mutual understanding and smooth communication, relieved from different working principles or misunderstood goals.
Familiarity with U.S. laws and regulations
Last but not least – familiarity with U.S. laws and regulations. The importance of this benefit of nearshore outsourcing should not be neglected. The fast-changing regulatory climate, followed by disruptive technology trends, doesn’t leave much time for acquainting with the issues from the scratch. It has to be already acquainted, as it is a case in your nearshore region.
Nearshore outsourcing is on the rise
Software development outsourcing in Latin America has grown tremendously in the last years, especially in countries like Colombia, Mexico, Argentina, and Peru. The reasons for such growth lay in the fact that these countries offer highly-qualified software developers, Agile development strategies, and fast and easy cooperation at significantly lower rates than what you would pay for the same quality provided by your in-house development team.
Did you know that according to the World Bank’s Ease of doing business index, Colombia scores as one of the top countries in the region?