The COVID-19 pandemic has had a significant impact on businesses, particularly in terms of sales and revenue. As a result, companies are prioritizing cost reduction and optimization. According to a recent Deloitte survey conducted in 2020, 70% of businesses are driven by cost reduction when selecting a software development partner for outsourcing, rather than considering other important factors such as enhanced user experience, scalability, competitive edge, and faster product launch. Outsourcing is a multifaceted and extensive process that companies approach in various ways. In this context, we will explore the different ways in which businesses can save money by opting to outsource instead of hiring in-house team members.
Software Development Outsourcing
Companies and startups may choose to outsource their software development in order to avoid the hassle of recruiting team members and setting up new departments. Essentially, they are hiring a technology partner company that will not only develop their product but also conduct the necessary research for product development. This approach is often used by offshore software development companies to work with clients, giving the impression that they are not only a technology partner but also a tech co-founder who will address any product development queries. Adopting this approach can help startups, big companies, and SMEs save costs in several ways. For one, they can save on infrastructure costs that would have gone toward building a product development team. Additionally, by finding a reputable and well-structured software development company, businesses can save time and eliminate the need to micromanage the development process. This approach can allow them to focus on what really matters, such as improving customer experience or achieving other business goals. In short, outsourcing software development can provide many benefits and help businesses thrive.
Hiring Single or Multiple Developers
Companies often use a second approach to outsourcing software development, which involves hiring single or multiple remote developers from established outsourcing companies. This method allows businesses to tap into a global pool of talented developers from all around the world. Initially, companies hiring developers through this approach may start with a single developer, but as the company grows, they may build a complete product development team through the same outsourcing software development company. One of the main benefits of this method is that it enables companies to recruit developers from a variety of countries, such as India, the Philippines, Ukraine, Rwanda, Kenya, Nigeria, Uganda, and South American countries. This geographical diversity also offers the added advantage of employees working on the company’s products almost around the clock due to the time differences. Using this approach, companies can save costs in various ways. This cost-saving potential is just one of the many advantages that companies can gain by adopting this approach to outsourcing their software development needs.
Building a Dedicated Tech Team
Another strategy employed by companies is to hire an entire product development team from a reputable IT outsourcing company. This approach involves hiring all the necessary positions for your company’s development needs, including front-end, back-end, and full-stack developers, graphic designers, and UI/UX professionals. By doing so, businesses can create a dedicated team that operates as an in-house team, with the only difference being that they work remotely from an offshore location. Partnering with an offshore software development company in india to build a dedicated team offers several advantages to businesses. For one, they only need to hire a project manager to work closely with the remote team. Additionally, the offshore company can manage the product development team to ensure that they are delivering, which increases the likelihood of contract renewal for subsequent years. Another benefit is cost savings, as companies don’t need to set up office space or provide other resources for their remote team. By working with dedicated experts who are focused on their product development, businesses can be assured of high-quality work, despite the team working from a remote office. In summary, this approach provides businesses with an efficient and cost-effective solution to building a complete product development team.
Other Factors That Save Costs
Simplified Scalability: Scaling up a software development team can be a challenge, especially if the company is located in an area with limited access to skilled developers. Additionally, in-house hiring can be time-consuming and resource-intensive. Therefore, outsourcing a product team from a reputable IT software outsourcing company offers the flexibility to scale the team up or down as needed.
Reduced Training Costs: One significant advantage of outsourcing remote developers is that they often require less training on project-specific requirements and technologies. Remote workers are generally more self-sufficient and can find the resources they need to onboard themselves. This approach can result in reduced training costs compared to in-house workers during the onboarding process.
Affordable Labor Rates: Hourly wages for developers in some African countries, like Rwanda, are generally lower than those in European or Asian countries like Poland, Ukraine, India, or the Philippines. Therefore, hiring a structured IT software company from Rwanda can save costs compared to similar companies in Europe or Asia.
Accelerated Time to Market: Hiring and building an in-house product team can be time-consuming, whereas outsourcing a software development company can start working on the product right away. Consequently, this can lead to a faster launch of the product to market, which can increase the chances of acquiring early adopters and customers.
Reduced Infrastructure Costs: Startups often face challenges expanding their infrastructure when their team grows. Outsourcing a software development company can help save the costs associated with expanding infrastructure, which can then be invested in other areas of the company that require attention.
Final Thoughts
Vofox has extensive experience in developing software solutions across geographical and cultural boundaries. As a team of global programmers and cross-cultural experts, we are adept at operating in diverse, multicultural environments. Our team comprises highly skilled developers who can be hired to develop your product. Whether you need a single developer or an entire team to complement your in-house product development efforts, we can help you save costs and maintain confidentiality while adhering to compliance regulations.