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A Comprehensive Guide to Offshore Software Development

May 6, 2024

offshore software development

Life without software doesn’t happen anymore.

But launching new solutions presents developers – newbies and experts alike – with plenty of obstacles. 

Software development means you have loads of tasks, like creating products from scratch, meeting deadlines, and managing staff. Moreover, lack of expertise and the pressing need to launch software faster to stay ahead in the market complicate the process even more. As a result, offshore software development has entered the chat. 

Outsourcing your software project helps save time and offers numerous other benefits like cost reduction and reduced time to market. Businesses of all sizes and niches find it to be an ideal solution. 

Want to get started with offshore software development?

In this article, you’ll explore a comprehensive guide to offshore software development. Let’s go! 

What is offshore software development?

The market size of offshore software development is likely to reach an incredible $283 million by 2030. The offshore software development statistics clearly show the evolving demand for such services in the future. 

Graph depicting that the market size of offshore software development is likely to reach an incredible $283 million by 2030.

Source: Verified Market Research

Gone are the days when organizations were limited to local talent for their IT needs. With globalization and digitalization, you can go beyond geographical boundaries and tap into the exceptional skills of professionals everywhere. 

Offshore software development delegates its software projects or tasks to a third party in another country. When you can’t find local professionals or services close to home, offshore development saves the day. 

Offshore developers bring the perfect blend of soft skills and technical expertise to handle the different components of software production. They can provide all the support you need, from building new software to testing and implementation.

Delivering high-quality and feature-rich solutions to your customers becomes easy with offshore software development teams. 

What kind of services can companies outsource?

Now that you have a basic idea of offshore software development, let’s delve into the most prominent services.

Mobile development services

The demand for mobile apps keeps rising. The number of mobile users in 2023 was 7.33 billion. The figures are likely to reach 7.49 billion by 2025.

graph showing the rise in mobile users

Source: Statista

Therefore, more businesses are focusing on developing mobile apps to reach out to a wider global audience. However, not every business has access to the expertise and technologies to develop mobile applications. Instead, they opt for offshore mobile development services.

Besides cost and time savings, outsourcing lets businesses launch their apps faster to stay ahead of the competition. 

Web development services

Did you know there are nearly 1.13 billion websites per this 2023 survey?

Any business that wants to establish a strong presence online and expand its customer base has to have a website. 

However, building a high-engaging and professional-looking website that drives traffic and boosts sales requires time and resources that not every business has. The lack of appropriate resources can leave your business in the dust.

Outsourcing web development solves this dilemma so resource-poor companies have a chance to thrive. It allows businesses to focus on their core functions while offshore developers prepare their websites. 

Quality assurance (QA) and testing services

You have to test software applications before launching them to help remove potential flaws, deliver high-quality applications, and enhance the overall user experience. 

However, performing QA tests requires a big time investment, and the person conducting them has to know what they’re doing. If you have time constraints and lack the expertise, outsourcing QA and testing services to offshore teams makes good business sense.   

UI/UX design services

With websites, 94% of first impressions have something to do with design elements. Therefore, creating exceptional user interface (UI) and user experience (UX) designs has become the need of the hour for every business. 

Creating a simple yet appealing design means staying connected to UI/UX trends. Without experienced designers, outsourcing your graphic needs serves as your best bet.

The offshore team of designers will ensure that your apps look great, function easily, and offer a memorable experience to your users. 

Offshore software development models 

You’ve got several offshore software development models to choose from. Here's a list. 

Managed product model

The managed product model is ideal if you work with a tight deadline and limited people. In this model, your internal team of designers, project managers, business analysts, and solutions architects collaborate with offshore engineers and external technical consultants to develop complete software.

The collaborative model adapts to fit within your time and budget. Moreover, you can expect detailed reports and complete transparency during the process. As a result, accomplishing your business goal becomes easy. 

Time and material model

This engagement model functions according to the time the offshore development time spends on your apps or software. It aligns with long-term projects. 

If you opt for this choice, you pay the offshore company for every month they spend on your project. This flexible method scales with emerging small companies and offers them high-quality outcomes with low risks. 

Dedicated team model

When you have a long-term project with changing requirements, choose the dedicated team model. In this case, you hire a specialized IT team who work exclusively on your project. The payments are made per your terms and conditions agreed upon in the contract.

Opting for the dedicated team model can become expensive, but you won’t have any concerns about getting the best services and communication from your offshore developers.

Compared to the other approaches, you get more project clarity, a higher level of control, and a lower administrative burden. 

Fixed price model

As the name of the model suggests, you hire an offshore development team at a fixed price. This best suits small and mid-sized projects that go on for short durations. 

When you’re on a budget, the fixed price model prevents you from exceeding your budget limit while launching high-performing applications. 

Benefits of offshore software development

Are you still wondering whether you should outsource your development project or not? Here are some benefits of offshore software development. 


Reputable offshore software development companies have years of rich industry experience and expertise. Their proficiency in every tech stack means you can call on them to build any application you can imagine. Whether you want to develop a mobile or web app, they know all the ins and outs. 

Moreover, they know the best software development practices, like version control, attention to style, and naming conventions. As a result, you can expect higher conversion rates and greater success. 

Cost-effective solution

Nearly 70% of businesses list cost-cutting as one of the primary reasons for partnering with offshore development teams. It lowers your development fees significantly and enables you to save more on your budget.

Offshore software development rates differ from region to region.

If you hire developers from North America, you may have to pay between $80-150 per hour. But when you choose Eastern European developers, you only pay $25-50. You have the flexibility to hire developers from different countries based on your bank account. 

Offshore software development rates by continent

Region Average hourly cost in USD
Asia 20-45
Eastern Europe 25-50
South America 30-60 
Western Europe 50-200
North America 80-150
Africa 30-99
Australia 50-70

If you outsource, you don’t have to pay for full-time, in-house developers or their training.

Moreover, there isn’t any need to set up a workspace and invest in the technologies and tools. All this contributes to reducing costs and allows you to build applications within your budget.  

Access to a wider talent pool

Your development team can either make or break your launch and rollout. 70% of employers across the globe say finding the right talent challenges them in significant ways.

graph showing global talent shortages

Source: Computer World

According to a survey in 2023, hiring developers with the necessary skills continues to be a tricky roadblock. 

Offshore software development allows you to connect with competent tech experts anywhere to have the best for your project and deliver top-notch solutions that meet user needs. 

Convenient workload management

Managing a business turns you into a circus performer trying to balance everything on your plate. If software development isn’t your core business function, it’s just an additional burden. 

The smartest move is jumping onto the bandwagon, with 57% of businesses opting to outsource their software projects. While the experts handle the development tasks, you get to focus on boosting your profits and expanding your business. 

Superior quality outputs

About 10% of new businesses fail in the first year for several reasons, with low product or service quality being a prominent cause.

graph showing rates at which startups fail

Source: Exploding Topics

However, when you choose the offshore software development model, the experts you hire engage in appropriate testing procedures to get rid of all the bugs and launch your applications flawlessly.

They use the best practices in the industry and ensure your apps meet global standards so you can be confident that you’re providing your target audience with the best software around. 

Better scalability

Having an accurate idea of the number of developers you need for any solution presents a tricky difficulty, but offshore software development scales effortlessly. With offshore development, you can easily move up or down per your current requirements. 

For instance, when you have to speed up product development, you can hire more developers on a temporary basis. On the other hand, if you don’t have any projects in line, you can cut back on hiring. 

Faster launch time

On average, software development projects take between one and nine months, but that’s a little too long for our current needs. As a result, you might fall behind your competitors.

Launch your software faster to outsmart your rivals and get the first-mover advantage. Offshore software development expedites your process to send you past the competition. 

Access to next-gen technologies

You must know how to use the right technology to stand out and deliver world-class applications. However, on average, companies lose up to $1.3 million due to outdated technologies

If you want to avoid such a big hit, choose to offshore your software development. Since these companies are specialists, they have access to all the modern business technologies and tools that make your application production possible so your consumers always get exactly what they want from you.

Shared accountability

When you outsource software development, you enter into a mutually beneficial relationship because you and your freelancers share responsibilities for developing the applications.

You won’t be the only one to worry about the end results of the development projects. Instead, the offshore team partners with you to mitigate potential risks and deliver flawless applications.

Offshore software development challenges

Undoubtedly, several offshore software is appealing, but you can’t overlook the challenges you will come up against. Keep reading so you can plan ahead.

Communication issues

Even though English has dominated as a global language, plenty of development professionals remain exclusive to their native languages. Chances of miscommunication rise, which may slow down your project. 

Cultural differences

Varying cultural expectations, work styles, and approaches may result in friction.

Before you partner with the offshore teams, identify the cultural differences and set common standards to avoid accidental disrespect. This lowers the chances of conflicts.

Risk management

When you opt for offshore software development, you may come across several risks in operations, decision-making, and other activities. For instance, there is a chance of missing deadlines or incomplete understanding of the business goals. 

Make sure you conduct a risk assessment during the initial phases of the project and pinpoint problem areas. Overcoming the challenges becomes simple and easy. 

Quality assurance

Software QA guarantees that your final product meets all the set requirements. However, ensuring software quality can be challenging when working with remote teams. 

This is mainly due to the differences in testing tools, technologies, standards, and methodologies. To avoid issues, establish standardized testing protocols and engage in regular communication to stay updated about progress. 

How to get started with offshore software development

Let’s assume we’ve convinced you of the benefits of outsourcing your software development. Unsure of how to get started? Keep reading to learn how to navigate through the entire process, from need determination to quality requirements. 

Determine your needs

Without clarity about your needs, figuring out the end goals and optimal results gets difficult. It also makes communicating your needs to the offshore development team hard. 

Identify the exact problems your business is facing and how you intend to use the software to address them. Take time to think about the type of software you want to develop and the expertise you need. This is a good time to coordinate operations with your in-house and external partners. 

Define your goals

Once you have clarity on your needs, the next step is to reach your goals.

Start thinking about what you want to achieve by outsourcing your software development project. It can be anything from reducing the time to market to gaining access to expertise and launching high-quality software. 

Clarity of goals will serve as a guiding force and help the offshore developers proceed in the right direction. 

Look for the best offshore software development companies

During your research, you’re sure to come across several options. As a result, selecting the best one can be confusing. But don’t worry; you just need to factor in a few aspects to shortlist the options and finalize the right one. 

First, evaluate the reputation of the company in the market. You can visit their official website and go through the reviews of previous clients to get a clear picture. This also gives you an idea about the type and quality of their services.

Second, check their experience and expertise. Make sure the companies you’re considering have a competent talent acquisition strategy with a focus on rich experience in handling similar projects. They must be proficient with the latest tools and technologies and be aware of modern trends. 

Third, you need to gain insights into the capabilities of the company. For instance, make sure you understand the type of software they can develop, the time they need to complete projects, and the tools they use. The greater their capability, the better your outcomes. 

Fourth, figure out how much it will cost you – it can differ from country to country.  Choose a company that can deliver top-notch services within your budget. 

Prepare for documentation

Once you’ve selected the right company, it’s time to prepare for documentation. Make sure to list your needs, expectations, and outcomes. 

Comprehensive documentation leads to smooth collaboration with the offshore team and a transparent project management approach. It provides clarity to the developers and helps them use the right strategies to meet the budget and deadlines of your project. 

Stay updated

Finally, you must stay in the loop throughout offshore software development. Prioritize continuous communication to track progress and lower the chances of potential deviations. 

You can use several collaboration tools to stay current about the project. For instance, you can make use of video conferencing tools like Microsoft Teams for daily calls, and you can also benefit from platforms like Asana, Trello, and Jira. These solutions help you track tasks and effectively distribute them across teams. 

The role of offshore software development in digital transformation

Offshore software development can simplify your digital transformation journey, allowing you to gain access to global expertise and connect with skilled developers. 

With top global talent, outsourced software development is a cost-effective approach to building robust and secure applications. 

You can redirect your savings to other business operations, like digital marketing or research and development, giving you a chance to strengthen your brand's presence online. 

Scaling operations in the digital world have also become convenient with offshore development. You can easily expand or shrink down resources as per changing demands. You’re certain to make the most of what you have.  

You also get access to the latest digital tools and technologies that you normally wouldn’t. It ensures that your business remains at the forefront of technical innovation to gain a competitive edge in the market. 

Is outsourcing your software development project an ideal decision?

According to a survey in 2023, 83% of small businesses will continue to outsource their business services, clearly showing that the demand will only increase in the coming years.

However, several factors influence the decision to hire offshore software development.

You don’t need to outsource your project if you already have the expertise. If you find the price too high, dropping the idea and relying on your in-house talent is better.

However, hiring offshore developers presents an ideal decision if you lack appropriate tech talent in your team and require specialized roles for your project.

Tackling a complex project demands a lot of technical expertise and know-how. In such a situation, offshore software development proves to be the apt solution when you want to lower the operational and development costs and build software within a fixed budget. Tight deadlines can also spur you to partner with an offshore team.

Partner with the best offshore software development company for business excellence. Hire the experts in the industry and stay ahead of the curve.

Learn how artificial intelligence is changing the game by making software development smarter, faster, and more intuitive than ever before!

Edited by Aisha West

Software Developer Services Providers Customize your software solutions

Software developer services providers help businesses build the software that they need to drive business excellence.

Software Developer Services Providers Customize your software solutions

Software developer services providers help businesses build the software that they need to drive business excellence.

A Comprehensive Guide to Offshore Software Development Dive into the comprehensive guide on offshore software development. Approach delivering robust solutions by coping with the evolving digital landscape.
Harikrishna Kundariya Harikrishna Kundariya, a marketer, developer, IoT, chatbot & blockchain savvy, designer, co-founder, and director of eSparkBiz Technologies. His 12+ years of experience enables him to provide digital solutions to new start-ups based on IoT and SaaS applications.

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