Nearshore software development is a strategy that consists of outsourcing talent that can dedicate 100% in your company’s projects, aligned to your mission, culture, time zone, and your business unique needs. As per Forrester’s research, 39% of business leaders expect to use nearshore services. They will take full advantage of the cost-effective, skill-packed, and geographical perks available.
This is a clear indication that businesses are recognizing the advantages of outsourcing talent to improve their efficiency, while saving costs without putting in risk the quality. Nearshore software development is a facet of outsourcing that has recently gained recognition. Before the step by step guide, let’s dive first into the advantages and disadvantages of nearshore software development talent.
Advantages of Nearshore Software Development
The nearshore software development strategies allow you to access a large talent pool for your projects from nearby countries. Let’s dive into the top advantages of this effective strategy.
Listed below is a brief overview of the steps involved in nearshore software outsourcing:
- Large talent pool access: With nearshore software development services, you have access to a pool of untapped talent. These developers have the specialized skills your project needs.
- Easy Communication and Collaboration: Since you can access a large software development talent pool from nearby countries in your region, the communication is clearer, they work in your time zone, you can easily sync in your working hours, language and collaboration won’t be a barrier.
- Cost Efficiency: Hiring developers from countries with lower living costs is a major way of maintaining cost efficiency and increasing productivity. Since the talent is being well paid in these countries, the developers will feel more motivated, and comfortable by having a good life-work balance.
- Scalability: One of the biggest advantages of nearshore software development is the possibility to scale your development team, reduce the workload of your in-house team, and find that balance in the workflow, move faster, and deliver quality projects. No need for an office space for your nearshore software development team, and choosing the right partner simplifies the recruiting, training and legal efforts.
What will the size of the contract development and manufacturing organization outsourcing market be during the forecast period? The contract development and manufacturing organization outsourcing market size is estimated to grow by USD 136.9 billion at a CAGR of 17.01% between 2023 and 2028.
Disadvantages of Nearshore Software Development
- Dependency on third party: Depende in other organizations for this software development talent services can be a challenge as you will depend on their timing, cost and fees. That’s why it is important to choose the right partner to avoid misunderstandings, and maintain clear communication and expectations.
- Hidden cost: When you nearshore software development teams, you might be at risk of wasting more money than expected as per lack of transparency of most companies in the nearshore software development talent industry. Choosing a partner with transparent rate pricing and no hidden fees is key to avoiding later surprises.
In any business, there is a risk, and we all are clear about that. To avoid the most common mistakes when nearshoring software development talent, we give you a step-by-step guide to mitigate risks.
Step-by-Step Guide to Nearshore Software Development
- Choosing the right partner
Explore partners with a transparent and fair pricing model, for no hidden fees and later surprises. If on their website it is not shown and clear the pricing model and you have to book a call instead to know the pricing. Maybe you should consider moving forward to explore more competitors.
Here’s an example of a partner with transparent rate pricing shown on the website:
Teilur Talent’s website shows their monthly, hybrid, and buy-out plan for nearshore software development talent and never charge more than 20% of the candidate’s salary.
In addition, you can use the Talent Calculator so you can have clear expectations on how much will cost a dedicated Backend Developer in Mexico, for example, and be prepared before booking a call.
- Planning and Management
The company and its nearshore partner will collaborate to find the right nearshore software development team based on your business's unique needs. This will include fundamental aspects such as hard skills, cultural fit, and time zone alignment. Regular team meetings will ensure smooth coordination.
- Skill set requirements
It is important for you to have in hand the roles and expertise needed, a job descriptions with the hard and soft skills for each role, and the amount of people needed in every expertise, for this, you should make a analysis of your project, in order to provide this information and talent requirement to your nearshore software development talent partner.
- Screen Potential Talent
You will receive the potential candidates for a screening process, this will help you to save time pre-vetting hundreds of CV’s and only focus on the candidates that are a fit to your business requirements.
- Contract Agreements
When you have made your decision, your partner will send you the contract and service terms. This will include a statement of work and full non-disclosure agreements, payment terms, talent working hours, and all the details about the service provided by your partner. Check on the contract carefully, set up a call in case you have any questions before signing.
- Talent Quality Check
Make sure the partner you choose is following up with the nearshore development team that was assigned to you. This is a green flag that your partner really cares about your business growth, their talent, work quality delivery, and your experience as their client.
Conclusion
We can conclude that nearshore software development is an efficient strategy and one of the favorite strategies from industry leaders to save cost by hiring from countries with a less expensive cost of living, which means the partner will be able to offer much lower cost rates; in addition, the cultural fit, language, time zone, geographical proximity to US and Canada won’t be a barrier. Most importantly, choosing the right partner is key to avoiding spending more than expected or later surprises with hidden fees. If you would like to nearshore software development teams with a transparent partner, book a call here.
FAQ
1. What are nearshore teams?
Nearshore means that the team is located in countries that are geographically close, i.e., in the same continent or a similar time zone. Moreover, while offshore outsourcing consists in hiring talents in a faraway country, onshore involves working with a team situated in the company's country or region.
2. What is nearshore software development?
Nearshore software development is a type of outsourcing model involving a software development team that is geographically close to the customer (2-4 hours away). A nearshore location is the second-best option after onshoring, as it provides you with the same quality of tech experts while being more cost-effective.
3. What are examples of nearshoring?
The term nearshore generally refers to outsourced work that is done in a nearby country that shares a border with the country where the work is being done. For example, a software development company in the United States might delegate projects or tasks to a software development team in Mexico.
4. Why is nearshore better than offshore?
Nearshore outsourcing bridges the gap between offshore and onshore, providing the best of both worlds. As the name implies, the organization with which you will collaborate must be located in a country close to yours and, ideally, share the same time zone (or at least, not have more than 3 hours difference between).
