Choosing the best software outsourcing company in 2024 is a complex process that has a significant impact on your project’s chances of success. To achieve your business goals, you must consider some crucial aspects of outsourcing – choose the suitable outsourcing model, select the contract that best ensures your interests, and prepare to start the work.
But before all this, you must make an even more fundamental decision to influence your subsequent projects for months (years) – selecting the appropriate country to outsource to. The article below will focus on that particular subject.
Technology is constantly evolving, and software developers must keep up with the changes by learning and enhancing their skills regularly. If they fail to do so, the conditions for outsourcing deteriorate quickly in their economy. Therefore, the leading outsourcing destinations change sometimes annually, and businesses must keep pace with these changes to stay ahead.
It’s important to note that there isn’t a single “best” country for software outsourcing. Instead, the IT industry in different countries adapts to local circumstances and specializes in certain types of software development.
In this article, instead of choosing “the one” country that is the best in our opinion, we’ll focus on various countries that shine in particular types of software development, hoping it is time for you to decide which country you outsource to finally, you’ll be ready to make the right, evidence-based decision instead of painting with broad brushes.
Lastly, before we start listing the country, it is vital to clarify that we are writing about the top outsourcing destinations from the perspective of United States- and Western Europe-based companies since these regions tend to outsource the most. We’ve also chosen two American, two European, and two Asian outsourcing destinations to ensure that regardless of your time zone and requirements, at least one of these countries would fulfill them.
Outsourcing to Argentina
Argentina is one of the best countries for outsourcing software development and is well-suited for cooperation with companies abroad. The overlap of time zones between North America and Europe ensures smoother and more reliable communication, facilitating outsourcing. According to the 2023 EF English Proficiency Index, Argentina is in the high proficiency part of the spectrum regarding the English language proficiency level.
Thanks to the high-quality education system in the country, it is easy to find development agencies with skilled experts available for hire. This makes outsourcing software development to Argentina a safe and reliable option. One crucial factor to consider for both start-ups and large tech companies is the proximity to Silicon Valley – with just a 4-hour flight, Argentina is easily accessible. The country is already established as one of the top outsourcing locations, making it an ideal hub for nearshore software development services in Latin America.
Outsourcing to Mexico
Mexican companies have a rich history of collaborating with US-based enterprises. These companies are well-equipped to serve US-based businesses and efficiently handle assigned tasks Although English is not the primary language used in the country, the population’s proficiency level is more than enough for effective communication, and some software development agencies in the country entirely rely on English in their day-to-day operations. Language barriers are inconvenient, but the benefits more than compensate for them.
What are some crucial things to remember before working with a Mexican company? You should be aware of cultural differences that might affect your project. Mexican culture is really “laid back,” so you should always keep track of your project’s progress and ensure that your project meets the deadlines.
What’s more, Mexicans are similar to Indian employees in terms of deference. If you cooperate with a company based in these countries, you should always keep your instructions and expectations completely clear. If you want some input from the outsourcing teams, you must ask for it rather than wait for them to develop something.
Outsourcing to Poland
Top-notch software developers (3rd place worldwide in HackerRank), innovative market (with unicorns like AI voice cloning startup ElevenLabs, that achieved an unicorn status in January 2024), almost 80k IT-related graduates every year, and high English proficiency (usually close to top 10) are only a few of the benefits Poland brings to the table.
The salaries in Poland are lower than those in Germany, the United Kingdom, and the US. When combined with the high level of expertise and experience of Polish agencies, it makes Poland one of the most favorable countries for outsourcing complex and challenging development projects.
One cannot neglect to mention the EU’s substantial role. The European Union (EU) has implemented safety regulations and laws for protecting intellectual property (IP) that are uniformly applied throughout the region. If you decide to outsource your project to Poland, your data and rights will be safe and protected. The EU’s strong and consistent application of these laws and regulations has made it a top investment destination for over three decades. It is important to note that these laws and rules equally apply to outsourcing in Poland.
What is also essential is that constant trade and cultural exchange with Western Europe and the US has instilled a Western mindset and culture in the entire private sector in Poland, making the structure and operations of Polish development agencies almost identical to countries that tend to outsource (like the US and the UK), making cooperation with Polish specialists simply flawless.
Here is an article highlighting why Poland is among the best outsourcing countries. That’s where you should head if you want to outsource IT to Poland.
Time-zone difference between Silicon Valley/London and listed outsourcing destinations:
Outsourcing to Ukraine
Ukraine provides a delicate balance between high-quality developers and lower prices compared to the UK and the US. Furthermore, selecting a European location gives the added benefit of having a similar time zone, especially for Western European companies. American companies can also benefit from overlapping working hours with Ukraine-based companies.
If you are considering outsourcing to Ukraine, you must remember that Ukraine is not a member of the European Union, so it may not have the same regulatory framework and intellectual property protection standards as EU members. Additionally, business and trade barriers may be higher than with the EU, resulting in more paperwork and bureaucracy if you choose Ukraine as one of your primary outsourcing destinations. Ukraine also needs to improve regarding English proficiency, placing on the moderate proficiency scale (place number 45 on the 2023 EF English Proficiency Index).
It is also crucial to note that since February 2022 events, Ukraine’s political, social, and military situation has significantly changed. It is unclear when Ukraine will return to its previous state.
Outsourcing to India
When you think of outsourcing software development, this is probably the first country that comes to mind. That’s not a coincidence since most statistics confirm India as the top outsourcing destination. The country surpassed China in April 2023 as the most populated place in the world, acting only more as a place to find relatively affordable, educated labor.
If you are looking for cost-effective outsourcing solutions for simple tasks, India is an excellent option to consider. It has been proven to be an effective strategy to choose India for customer support services or for the long-term maintenance of your projects.
In case you need to outsource a complex project demanding highly skilled developers and close communication, look for alternatives beyond India. Although India is known for its IT outsourcing industry, it can sometimes be associated with cultural misunderstandings, lack of legal protection, and communication issues.
Outsourcing to The Philippines
Although the Philippines is much smaller than India in terms of both population and territorial size, these two countries are often compared when it comes to outsourcing in Asia. This is because the price ranges, quality of agencies, and talent pool available in both countries are relatively similar.
The Philippines is a favorable outsourcing destination, particularly when compared to other Asian countries, because the Philippines has been a US-dependent region for over four decades. During this time, Filipinos have embraced Western culture and the English language, making it easier to work and communicate with outsourcing companies from the Philippines.
As is the case with India, the Philippines’ low labor costs come with drawbacks. Apart from a challenging time zone difference (15 hours between the Philippines and Silicon Valley and 7 when you compare it to London), the Philippines regularly experiences problems due to its unique geographical location and environmental conditions.
The Philippines experiences typhoons yearly (11 tropical typhoons in 2023), causing power outages and floods. While this may not be a frequent problem, it could pose difficulties for your company. Therefore, if you decide to establish your business in the Philippines, it is essential to consider how the company deals with unpredictable weather conditions. You should be prepared to operate consistently and remotely to ensure your projects continue uninterrupted.
Factors to consider before outsourcing software development
When considering countries to outsource to, you should realize there’s no one-size-fits-all solution to satisfy your every requirement. There are always trade-offs when making such an influential decision. Here’s what you need to take into account.
- Before you start considering particular destinations for outsourcing, establish your needs and decide which factors play the most essential role in the success of your outsourcing efforts. By knowing these, you will be able to select the outsourcing destination that is the best fit and would provide the service you need precisely.
- Making the wrong choice will result in your projects experiencing unnecessary complications like miscommunication, cost overruns, zero time zone overlaps, and more, depending on the country you choose.
- It is important to stress that the outsourcing and software development world is very dynamic (e.g. situation in Ukraine since 2022). Will these countries maintain their position for years to come? No one can be certain, but as things stand now, surely one of these outsourcing destinations will be able to provide you with the outsourcing services you need within the quality and price range you’re looking for.
Read more about: Nearshore outsourcing to Poland
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About the authorSoftware Mind
Software Mind provides companies with autonomous development teams who manage software life cycles from ideation to release and beyond. For over 20 years we’ve been enriching organizations with the talent they need to boost scalability, drive dynamic growth and bring disruptive ideas to life. Our top-notch engineering teams combine ownership with leading technologies, including cloud, AI, data science and embedded software to accelerate digital transformations and boost software delivery. A culture that embraces openness, craves more and acts with respect enables our bold and passionate people to create evolutive solutions that support scale-ups, unicorns and enterprise-level companies around the world.