Is Outsourcing Nearshore all about Cost and How do we Compare?
Typically, when considering nearshore services there are many considerations, but cost is always either first or second on the decision tree. If nearshore outsourcing of software development services is being considered, you are actively considering your tight budget, thinking of how to meet your project milestones, time-to-market to meet your client’s product needs, how to build up the skilled and experienced engineering resources and how to rationalize the spend while considering long term operational impacts.
Although, the outsourcing of software development services offers many benefits, the cost element gets most of the attention. The nearshore model’s greatest and most attractive value is the ability to rationalize and optimize the expense by paying for highly qualified software engineers that speak English, can collaborate in real time, experienced in distributed remote work and with Intech Americas located in Mexico save you money providing the best cost-efficient option.
Let’s look into the cost! As Intech Americas is located in Mexico, let’s first review typical rates you may encounter by engaging in another region.
Lowest rates are in Asia
We all know about India where the average rate for outsourcing software engineering developers can range between $18 to $25 USD. Although it may meet your project budget needs, contracting with outsourcing companies in India bring many project hurdles. For example, close collaboration is usually impacted by large time differences prolonging project milestones, means longer engagements which always comes with an increase in overall cost. In addition, as well known, the quality of the services provided are not always great.
For consideration, other Asian countries that can be considered, like China, Vietnam, Indonesia and Malaysia. Their typical average rate can be between $30 to $40 USD for experienced developers but have similar disadvantages as India with the additional issue of poor English proficiency.
Mid-Range typically in Eastern Europe
At least, in the past, it was thought that contracting with software developers from Eastern Europe was mid-range. This is now changed. It was very common for average hourly rates to be between $25 to $40 USD, the current average hourly rate has increased ($50 to $80 USD) depending on the skills and expertise. These developers are the most demanded in their neighboring European markets driving their pay grades up.
Developers from Ukraine, Belarus and Russia offer lowers costs, where Poland, Bulgaria, Hungary, Romania and the Balkan countries have higher costs. All developers from these countries provide high level of software competency, good English proficiency, and experience.
Highest rates in North America and Western Europe
The highest rates can be found in USA, Canada and Western Europe. Hourly rates in these regions can range anywhere from $50 to $125 USD (even up to $250 USD) depending on skillsets and experience. So, I will not spend more time on these regions.
This brings me back to the nearshore service cost of Latin America and specifically Mexico, where Intech Americas is situated.
Latin America, the Best Return on your Investment
The rate range for Latin America can be between $25 to $50 USD, similar to engineering rates from Eastern Europe. Similarly, the rates can vary depending on the skillsets and experience required. Apart from cost, there are numerous additional benefits of outsourcing from Latin America, especially from Intech Americas located in Mexico, are:
- Close collaboration and workday overlap by being in similar time zones
- Cultural affinity with proficient English skills
- High engineering programming skills and industry expertise
- High Quality focus
- Total Cost of Engagement efficiencies
- Optimizing the budget by paying less for a higher quality software engineer
The table below shows a more detailed overall rate range per region for your reference.
Source: Accelerance
Intech America, using its nearshore model, “Time and Materials Co-Management model” can help you reduce and control costs, provide you access to the best resources with the highest level of expertise, will allow you to focus your internal resources to align with your business needs while accelerating your time-to-market and most importantly your customers’ needs in a cost effective manner. Remember, cost is important, but it is not all about cost. Many factors need to be considered, and Intech Americas can help.
Let Intech Americas be your partner on your development journey…
We look forward in you contacting us and discussing on how we can help solve your problems and meet your goals.
Please contact us: https://intech-americas.com/contact.php
