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Daria Spizheva
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May Ohiri
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Key takeaways: The market is full of offshore software development options, but which ones should you consider in 2023 to get the best quality software development talent? In this article, we dive deep into particular strengths, resources, and regulations of the top five offshore development countries:
Explore some of the hot spots for offshoring software development worldwide – Eastern Europe and Latin America.
Statistics show that there will be 28.7 million developers around the world in the next two years. This is good news, and it will definitely mean more great developers are available for hire. However, as I’ve been blogging about tech for a long time, I can attest to the challenges of finding high-quality developers at cost-effective prices. This is where offshoring comes into the picture.
Offshoring offers access to a vast pool of talent, enabling quicker project completion at a fraction of the cost. But finding the best region that caters to your specific needs can feel as daunting as trying to do a paint-by-number blindfolded.
TurnKey helps innovative SaaS-based startups win. We make creating and scaling remote software development teams easy — and spectacularly effective.
Offshore software development can vary widely across regions, countries, and niches, as we’ll demonstrate in this article. (If you’re new to offshoring and would like to learn more about the practice in general, this article can help.)
In this video, TurnKey’s CEO, Sterling Lanier, explains if offshoring fits your needs in a way your grandma will understand:
So what’s the solutions to this quandary? I think the key is to look for an offshore partner with real-world experience. TurnKey offers an excellent service that handpicks and assembles tailor-made offshore software development teams for you. The teams are sourced from an array of locations, including Europe and LatAm, known for their technical prowess and affordable rates.
TurnKey’s Yourshoring model specifically stands out with its unique processes that ensure quality hires through a meticulous selection process for developers. It doesn’t merely provide staffing solutions but also establishes a dedicated software development team for your needs. By doing so, it allows for better alignment with your project objectives, creating a cohesive unit that operates as an extension of your in-house team.
It’s essential to remember that successful offshoring isn’t just about cost savings—it’s about creating value at all levels of your development process. Offshoring to the right region with the right partner can yield a remarkable blend of quality, cost-effectiveness, and speed, powering your projects forward in a competitive market.
Ready to get started? Let’s go!
To get a clearer picture of how offshore software development varies around the globe, it’s most helpful to start at the regional level before getting more specific. Below are the top offshore regions:
North America (ie America and Canada) is the biggest and most important technology ecosystem in the world and boasts over 7,000 outsourcing and offshoring companies. Although the quality of deliverables is high when working with offshore software development companies in this region, the rate is far from friendly. Many startups and entrepreneurs with a lean budget or complex projects may struggle to afford such services.
Thanks to a close time zone to North America, Latin America is the go-to place for companies and startups in America who are considering a nearshore alternative for their software development without sacrificing the quality of their software project. Latin American offshore services make it easy for clients from neighboring countries to outsource their projects and still be able to maintain communication and supervision of work progress. This is made possible by the advantage of proximity, similarity in culture, and timezone.
I can confidently say that Eastern Europe is an exceptional choice for companies seeking high-quality software development at a low cost. Not only because I’ve been working for U.S. companies while living in Ukraine since 2018, but also there is a staggering number of vendors, estimated between 4,500 to 6,500, specializing in software outsourcing.
Clutch, a reputable platform, lists over 3,340 vendors providing tech offshoring services in this region alone. The concentration of skilled software engineers, coupled with the region’s friendly development rates, has made it the go-to outsourcing destination for startups, entrepreneurs, and companies with lean development budgets.
And why not, Eastern Europe offers affordability and stands out for its abundant pool of highly specialized developers in niche technologies such as AI, ML, and Blockchain. This rich talent pool allows companies to tap into cutting-edge expertise and leverage advanced technologies for their projects.
This is another region that houses top software developers, many of whom work for more than 6,489 offshore and outsourcing companies, according to Clutch. The Schengen Agreement of 1985 made it an attractive place for developers to relocate to and grow their careers.
Although slightly more expensive than Eastern Europe, Central Europe is still much cheaper than standard developer salaries seen in North America.
Asia boasts over 15 million developers that are ready to offer software development services at a comparatively cheap rate. The cost of outsourcing your software development to Asian countries varies based on each country making up the region but are generally less expensive than the other regions listed above.
China and India are the most prominent software development hubs in Asia, with China boasting over 7 million programmers and India recording over 5.8 million programmers. That said, other Asian countries, like Thailand, Malaysia, and Indonesia, are gaining traction and providing software development services of equal quality.
However, some firms – especially those based in North America – often choose a region other than Asia given the significant time zone differences between the two regions. This impacts collaboration and communication and can often negatively impact the quality of deliverables.
African countries like Egypt, Nigeria, Kenya, and Morocco are gradually entering the tech limelight. And with its proximity to Europe and strong pipeline of computer science students, this region is sure to grow fast in the coming years.
Although the cost of outsourcing software development to countries is cheap in comparison to other regions, they currently have a limited pool of highly experienced software developers (though this will change in a few years when the population of developers expands).
Parts of this region also suffer from poor network connections, meaning that this region may not be the best fit for complex projects or mission-critical applications that require 24/7 uptime.
And no matter where you may choose to go from an offshore perspective, there are some common pitfalls to avoid.
Read about the grievances that engineering leaders have told us about most.
As someone who has been reporting on remote offshore software development teams for years, I can attest that hiring from Eastern Europe is a wise strategic decision, particularly if your project requires high technical proficiency. This region has earned a reputation for staying at the forefront of the latest advancements and technologies in software development.
Eastern Europe has developed exceptional expertise in several popular categories, including the Internet of Things (IoT), Artificial Intelligence (AI), Machine Learning (ML), Augmented and Virtual Reality (AR/VR), Cybersecurity, and Big Data analysis. The highly specialized talent in these areas ensures that your project will receive the highest level of skill and knowledge.
What sets Eastern European developers apart is their ability to deliver these top-notch services at budget-friendly rates, without compromising on quality. To help you narrow down the options, I have compiled a list of the top three Eastern European countries for offshoring, which are known for their exceptional software development capabilities:
Poland’s economy is one of the fastest developing in Eastern Europe. It is home to a broad talent pool of software development expertise, with about 8 developers for every 1,000 residents. Its tech market is predicted to surpass 3 billion by 2023, with annual growth of 50 to 60%. As a result, outsourcing software development to Poland is expanding rapidly.
Take a look at the numbers:
Poland is also a great nearshore choice for companies in Western Europe as their developers are quite proficient in English, German, French, and Spanish languages.
Ukraine is one of the Eastern European countries that frequently ranks among the top worldwide software development outsourcing destinations. Its government actively advances the information technology sector by creating a healthy legal system and financial policy, making them more accessible to foreign firms.
Aside from their raw skills, the vast majority of Ukrainian engineers have university degrees and are proficient in the use of English. Clutch data shows that most Ukrainian outsourcing companies work in the eCommerce, Enterprise, and FinTech sectors.
And the Ukrainian software development market is growing by about 25% per year. Here are more of the eye-popping numbers:
Tech cities: Kyiv, Lviv, Ivano-Frankivsk, Odessa
Romania’s software development sector is one of the country’s fastest developing areas. The sector is predicted to witness a 12% GDP growth by 2025. As an EU member, Romania is one of Europe’s largest offshore markets, primarily focused on outsourcing services to the United States, Canada, and Europe.
Moreover, we have also created a detailed post on the “Top 5 Offshore Software Development Countries in Eastern Europe.” This post offers an in-depth look at the top locations in Eastern Europe that are renowned for their quality in software development.
Want to work with an Eastern European offshore development team? TurnKey is here to help.
There is a plethora of compelling reasons to consider Eastern European developers as the powerhouse behind your next project. My extensive research and firsthand experience have revealed that they are renowned for their exceptional technical skills and expertise, these developers stay at the forefront of the ever-evolving landscape of software development.
I’m sure you will also be impressed as we dive into the unparalleled prowess of Eastern European software developers:
For software companies in US and Canada, Latin America is the most preferred nearshore software development region due to its close time zone, affordable rates, high quality and cultural similarity.
Some of our clients are already enjoying the nearshoring benefits of this region. Headspace, a pre-IPO company that boasts a significant US-based development team, encountered a significant hurdle in their pursuit of more top-notch development talent at a reasonable cost within their local market. Faced with this challenge, they made a strategic decision to partner with TurnKey in order to establish an R&D Innovation Center of Excellence in Mexico. This move allowed Headspace to leverage our expertise and tap into the abundant pool of skilled professionals in Mexico, ensuring access to exceptional talent while optimizing costs.
Within just 30 days of signing the contract with TurnKey, the first round of hires for the center were swiftly recruited and onboarded. Such a rapid and efficient hiring process showcases the effectiveness and dedication of both Headspace and TurnKey in identifying and securing top talent in Mexico. The early triumphs of the center have exceeded expectations, prompting Headspace to expand their initial plans!
TurnKey was able to build out the first team in under two months of working with Headspace. The talent was overwhelmingly positive. We were surprised at the quality of the engineers Turnkey was able to find and the speed with which they were able to find them.
Below are three of the most popular offshore software development countries in LatAm (note: Colombia is a close fourth!).
With the largest population in South America, Brazil is the 800-lb. gorilla in the offshore industry. In a study conducted by Agile Engine, it was found that Brazil has the most software developers in the region with over 400,000 developers. And according to the Tholons Services Globalization Index 2019, Brazil ranks as the #1 digital hub in all of Latin America (based on a wide range of variables).
For IT companies in North America looking for nearshore software development companies, Mexico is the first place to consider. Mexico is the United States’ nearest geographical neighbor and its primary economic trading partner. There is essentially no time difference (at least with Central Standard Time), and many Americans of Mexican heritage work in the tech sector.
It is also close enough geographically for IT companies to travel back and forth for meetings with their development team. As a result of this geographic advantage, many U.S-based tech companies look to outsource software development to Mexico.
Argentine developers have the highest literacy rate and the best English proficiency in Latin America. As a result, Argentina tends to command slightly higher prices than other countries in Central and South America, though many customers feel the greater collaboration created through shared language makes the added price tag well worth it.
My recruiter depicted the Argentine employment landscape as one filled with “job hoppers” – individuals who often switch roles or don’t have a consistent career trajectory. This scenario presents considerable hiring risks.
Therefore, we don’t hire developers from Argentina, as according to our principles, it’s important to maintain a high retention rate.
Got your sights set on LatAm for your next offshore project? Let TurnKey create a dedicated team of awesome developers for you there.
After meticulous research, I have uncovered a multitude of reasons that contribute to their exceptional talent and expertise. Latin America boasts a vibrant tech ecosystem, nurturing a culture of collaboration, knowledge sharing, and continuous learning. Latin American developers have earned a reputation for their unwavering commitment to excellence, staying at the forefront of the rapidly evolving software development landscape. Still not convinced? Here are a few more reasons why this region is considered world class:
Are you having trouble keeping up with the complexity of hiring offshore software developers, particularly across multiple geographies? TurnKey’s got you covered with our unique model called Yourshoring!
Youshoring gives you the juicy bits of offshoring without the stress of squeezing the grape. TurnKey’s Yourshore model provides four key benefits that keep your software development efforts humming:
In other words, we help you create remote software development teams that are completely tailored to your requirements, regardless of which direction is best for you. Put Yourshoring to work for you!
Want to learn more about Yourshoring and how we can help supercharge your product development efforts?
There is no straightforward answer to this question. A developer’s pay rate depends the level of expertise, the amount of technical skill desired and often fluency in English. But in general the countries with the most budget-friendly rates are Ukraine, Romania, China, Vietnam, Mexico, Brazil and Colombia.
It's difficult to accurately judge which offshore software development countries have the biggest software market. But anecdotally it would be a race between China, America, Ukraine, and India.
This is a subjective question that may vary based on the person responding. But many experts pick Ukraine given its affordable rates for developers and its large and highly skilled talent pool.
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