Many businesses large and small have found the benefits of outsourcing software development. It’s nearly impossible for any one business to employ specialists in every IT niche and many corporations don’t have a need for a team of software developers in-house and onsite every day.

Whether you’ve worked with others to develop software before or this is a new endeavor that you’re taking on at your business, it’s important to find the right outsourced software development company that can take your ideas and turn them into a reality.

How much does it cost to outsource software development?

In order to talk about costs, we have to talk about the different types of outsourcing: onshore, offshore, and nearshore.

Onshore outsourcing is when you outsource to another company within your country. While this is the most expensive option with hourly rates from $100-$250, you may find that it is the best option. Because you’re outsourcing to a company within the US, you’ll be able to communicate effectively and work together to create finished software that you are involved in every step of the way. Did we mention it? Pegasus One also offers local liaisons, so if you’re located in a different state you don’t have to worry about time differences and can work with someone one-on-one to create a finished product that is right for your business. When you onshore outsource, you’ll also have the support that will make the project run smoothly.

Offshore outsourcing is when you outsource to another company far away from your country, like Asia or India. This is the cheapest option. While costs may range from company to company and are based on projects, you can easily find hourly prices ranging from only $10-$20. While this may seem like the cheapest option, it may also not be the best option because you have to deal with language barriers and time differences that can cause a breakdown in your project. Communication is crucial when it comes to software development, so working with an offshore outsourcing company may save you money, but can end up costing you time, resources, and a good outcome for your project. Fortunately, you can find outsourcing companies that are able to provide you with peace of mind because they offer local liaisons who can work with you to create an end product you’re proud of. These liaisons will solve any communication and time-difference problems to prevent issues.

Nearshore is when you outsource to a company to another country that’s not too far from yours. If you’re in the US, you could nearshore outsource to somewhere in Eastern Europe where hourly rates are around $25-$50, but you may still run the same risks of language barriers and time differences that will cause you frustration. Like with offshore outsourcing, you may be able to find an outsourcing company that while not in your country, still offers local liaisons so that you’ll have a partner nearby that can answer your questions and help you with your project.

Why should you outsource your software development?

Cost-Effectiveness: Paying an in-house team can be expensive when it comes to software development. Outsourcing is more cost-effective than having a team in-place onsite. You only pay for the work that gets done, rather than paying a salary and benefits, so while a larger hourly rate may be difficult to swallow at first, you’ll actually end up saving money.

Expertise: Whether you’re a start-up or a large corporation, you may not have an in-house software development team in place that can handle your project. In some cases, businesses may have a software team, but they lack the expertise and knowledge to create and launch new software and cannot integrate AI.

See more about: AI solutions

Efficiency: Time is money in business, so you want to develop software that fits your needs in a timely manner. If your current corporation doesn’t already have an in-house team, it’s probably not the best idea to hire full-time employees for one project and the hiring process itself can be time-consuming, especially if you don’t know enough about software development to ask the right questions during interviews. Simply, you just don’t have the time to find employees and train employees and that’s why outsourcing is your best option.

How to outsource software development

Now that you’ve decided to outsource your software development, it’s important that you know how. To outsource your software development, you should take a few simple steps.

  1. Refine Your Project and its Goals: Whether you have a project ready to begin development, or just have an idea, you should refine your goals before proceeding. It’s important to know exactly what you want so that you can communicate effectively with a development team.
  2. Research: The best way to find the right software development company is to do some research on your own. If you know others in your industry who have outsourced software development before, it’s important to ask them about their experiences. When you do research on your own, you should look for companies who have the qualifications and experience to work with your industry and have worked with other professionals successfully. Look for case studies on their websites featuring companies similar to yours that they’ve worked with and try to find reviews and testimonials from their past clients.
  3. Think about Geography: Now that you’ve learned the different geographical types of outsourcing, you should consider it when looking for a software development company to help you with your projects. While you may want to go with the most inexpensive company, you’ll often find that you get what you pay for. You may also want to find a company that’s located near your offices to make communication easier, but with research, you can find that they’re not the right fit and may not have ever worked on a project for your industry. We understand that many businesses want to be able to communicate effectively and work together on their software development projects, so we give our clients local liaisons, no matter where they are so that we can truly collaborate on important projects.
  4. Make Some Phone Calls: Odds are that after your research is done, you’ll have narrowed down your search but still have questions. Now that you’ve refined your project and its goals, you can simply find the phone number of your prospective software development companies and speak to a representative about your project and ask any additional questions you have.

How to manage your outsourced software development project

Managing your outsourced software development project can be easy. By remembering a few simple tips, you’ll guarantee the success of the project and create a mutually beneficial relationship with the outsourced software development company.

Communication is Key: No matter what company you’re working with, it’s important that they understand your goals. Effectively communicating your needs for the project will help the entire process run smoothly. You should also communicate on a set schedule to stay informed on the project and make sure you’re consistently on the same page.

Don’t Micromanage: While it is important to oversee the project, micromanaging can cause breakdowns in the system and cost you even more time and money. If you have effectively communicated your goals for the project, it’s time to trust the professionals. However, if you do have concerns, you should speak to them immediately and let them know. They may already have a solution in place or are working to fix any errors, so it’s important to remember that they’re doing everything they can to make sure you’re happy with the software.

Collaborate with Technology: While communication is important, you can’t communicate all day, every day. Using project management software can help you easily collaborate with the outsourced company and give you a better idea of timelines and completed tasks.

How to choose a software development company (checklist)

Choosing a software development company may seem like a large task, but it can be made simple. There are important aspects that you should look for in a software company that will ensure projects run smoothly and on time. Here are a few questions you should ask yourself when doing your initial research and the prospective software development company once you’ve narrowed down your search.

  1. What is the process like? This will help you get the big picture on their approach to software development.
  2. How does communication take place? The best software development firms will be able to provide you with set schedules for calls and video chats.
  3. What should we expect from each other? This will help you get a better idea of what you can expect from them and should communicate how the software development company expects you to be involved in the project.
  4. What collaboration tools do you use? With communication comes collaboration and it’s important that both companies work together for the best end result.
  5. How is software quality ensured? What tests or reviews are done? Testing should be done on all software to ensure quality and make sure it works correctly.
  6. Do they offer local liaisons? Having someone close will give you peace of mind and answer questions and concerns.
  7. What makes this company stand out from the rest? You want a software company that proves its worth by more than just delivering a finished product. Make sure you confirm that the software developer is an expert. You can do this simply by looking at their website to see if they offer valuable and insightful information.
  8. Has this software development company worked in your niche? You can also find this information on most websites. It’s also important to look through any case studies to see how they’ve helped other similar companies in your industry.