IT outsourcing has become a truly global trend and is becoming more and more popular each year. For instance, just between 2016 and 2017, we saw the percentage of total IT budget companies spend on software development outsourcing go from 10.6% to 11.9%, according to a yearly IT Outsourcing Statistics survey conducted by Computer Economics.
There are very few industries and businesses that don’t need or can benefit from some form of software development for their brand. Whether that’s a website, an internal workflow system for employees, an eCommerce inventory tracker, a mobile app, or something else, almost every company can find software development useful.
The problem is, not everyone has the expertise and/or manpower to execute software development projects. That is where offshore software development companies come in.
Now, choosing the best software developer to meet one brand’s needs often seem like a daunting task, but there is a whole world out there filled with qualified software developers. All you need to do is look at these software development outsourcing countries to find some.
That’s the beauty of the Internet. Your company doesn’t have to look only to its immediate surroundings or even the country where it is located to find a suitable software development service.
Such partners can now easily be found almost anywhere on our planet.
But why should you even outsource software development projects in the first place?
Here are a few reasons to look for offshore software development:
- Better exposure to well-educated and highly-trained global talent
- Lower costs (companies save as much as 30% thanks to software development outsourcing)
- Better risk management due to the ability to partition software development operations
- You can hire talent when you need it, rather than have it sitting on your pay list for 12 months
The downsides are:
- Political and economic volatility. In some of these countries, political power can change in one night and completely alter business prospects. You just have to hope for the best and that the current government does not make any laws that will affect the business too much.
- Language barriers (remember that most of these are not English-speaking countries, with the notable exceptions of Australia for example)
- Time differences. Software development projects often rely on collaboration and that can suffer if the other side is in a completely different time zone
10 Best Software Development Outsourcing Countries Today
Between 2000 and 2018, the global size of outsourced services has almost doubled from $45.6 billion in 2000 to $86.6 billion in 2018, according to a report from Statista report.
Indeed, today we can only say how happy we are to be able to draw software development talent from all over the world. Such a thing was simply not possible some 15-20 years ago.
Of course, not all offshore software development countries rank the same in quality or indeed in price.
For instance, since one goal of IT outsourcing is to actually spend less money, it doesn’t make that much sense to outsource to a western-based software development country if the price is going to be the same as in the United States.
We rounded up the 10 best countries to outsource software development to, listed in alphabetical order:
When one country puts so much emphasis on science and mathematics in their schools and universities, how can you expect anything less than hundreds of IT experts to come out of it every year?
In 2016 alone, China had 4.7 million STEM graduates. More than any other country. In comparison, the U.S. had only 568,000 and was fourth behind China, India and Russia.
Add to that the fact that Chinese programmers and developers generally excel at functional programming, Python, Shell and more and that the average pay for a software developer in China is $19.232, compared to his U.S. colleague who earns $69.083 per year and you can see why China ranks so high in software development outsourcing.
Research shows that Hungary is the fifth best country to outsource to in order to find the best software developers. This means that leaning towards Hungary for your custom software needs increases your odds of finding a reliable and qualified development firm.
Some of Hungary’s top software development projects include building databases, and writing code in Shell, C++ and JAVA.
India is the second country in the world in terms of population, but more importantly, for our discussion, the number of STEM (science, technology, engineering and mathematics) graduates at 2.6 million (behind only China).
What makes India also a prime location for IT outsourcing is the fact that an average software developer in India charges between $10 and $15 per hour, making them much cheaper than the U.S. software development agency who can charge $60 per hour on average.
4. The Philippines
According to some estimates, more than 4 million trained Philipino workers have some experience working for a foreign company. That just shows how sought-after they are for outsourcing.
Each year, The Philippines “cough up” more than 112 IT and engineering grads, all well-versed in Java, API development, .NET and more.
Poland is in many ways an ideal country for software development outsourcing. Not only does it have a solid pool of talent (80,000 new IT graduates every year), but the country is also a member of the WTO, EU, NATO, UN, Patent Cooperation Treaty, Berne Convention, the Paris Convention, the Madrid Protocol and a whole other host of organizations.
That means their companies can have an easier time transferring data and information safely, which is not always the case with offshore software development companies from Asia for instance.
Russia may not be the favorite country in the U.S. politically, but one can’t deny that they have a vast number of IT experts. For every million people in Russia, 3.500 are engineers of some description.
In addition, Russia’s top software projects include algorithms, and writing software in software programming languages such as JAVA, C++ and SQL.
7. South Korea
What can one say about South Korea and not mention their tech companies? From Samsung to LG and Hyundai, South Korean tech companies dominate the globe in their respective industries.
They wouldn’t be able to do that without a pool of well-trained software developers at their disposal. Fortunately, not every high-quality developer in South Korea is taken and software development projects comprise more than half of the country’s outsourcing market.
Taiwan is another country that almost instantly pops into the mind when we are talking about outsourcing. The reason is very clear. They have a great tradition of outsourcing across all industries and is one of the first countries to outsource from North America in the 1960s.
If you are thinking of hiring offshore software development firms from Taiwan, pay close attention to the ones versed in data structures, functional programming and algorithms and you won’t be disappointed.
Eastern Europe is taking the lead in offshore software development and Ukraine is at the forefront of this.
In fact, of more than one million software developers educated and trained in Eastern Europe, almost half (42%) are based in Ukraine and Poland.
Some of Ukraine’s top software projects include mathematics, security and distributed systems, although they have experts across all areas of software development.
Another country with a particularly strong tech industry, Vietnamese companies can boast the fact that such giants as IBM, Microsoft and Intel all invest in software development there.
Vietnam-based software devs particularly excel in artificial software development projects.
How Much Do Software Developers Charge In Each Of These Countries?
How much does an offshore software development company charge? Well, that depends on a number of factors. These include:
- When you need the project to be completed by.
- How complex the project is.
- If the project is completely custom or if it is based on a template.
- How many people will be working on your project.
- The average pay in that country
- Is the country itself a member of some world organization like EU, WTO, etc
- And more!
However, there are some general guidelines that you can keep in mind as you search for the best software development countries to outsource to.
On average, you can expect agencies to charge the following amounts per person per hour of work:
- Central America and South America: $30-$50.
- Eastern Europe: $25-$50.
- Asia and Africa: $18-$40.
- North America: $95-$170.
You can clearly see here how much more expensive on average can software developers from North America be compared to other regions. And we are often talking about the same quality of work!
Because 44% of CEOs and CTOs outsource programming jobs to reduce costs, enlisting the help of a top-rated software developer somewhere else in the world might be the best way to achieve your goals while remaining in budget.
The Best Area for IT Outsourcing Projects in the World is…
Okay, you probably want to know which region has the best software development outsourcing countries?
The answer is…
In fact, we have some Eastern Europe Software Development Companies listed here you can outsource your projects to if you want. Check them out if you are looking for top-notch software developers.
There are over 1 million software developers educated and trained in Eastern Europe every year and 42% of them are based in Ukraine and Poland. And those are just two countries that we mentioned. We haven’t even mentioned software developers from Romania, Bulgaria, Serbia, Croatia or Greece.
For instance, Romania has 40+ tech universities, producing around 5,000 computer experts and engineers every year, while in Bulgaria, that number is around 3,500.
What is it that makes Eastern Europeans such as good choice for IT outsourcing?
- Convenient time zones
The time difference between China and the United States (Washington D.C. in particular) is 12 hours. On the other hand, between the U.S. and Poland is just 6 hours. That six hours can be a huge difference-maker, especially in high-paced the software development industry.
- Favorable prices for a good skill
An average software developer in the U.S. earns about $60/h. At the same time, the one in Eastern Europe will be quite satisfied with half that and the quality of work will not suffer an inch.
- A large talent pool
Eastern Europeans have truly embraced information technology as the way forward. That means, more and more people there are graduating IT subjects or finishing courses. Once they are done, they often decide not to stick around, but seek more opportunities abroad.
- Location and culture
Software development projects tend to be much easier when you can clearly communicate with your development team. This is not just a matter of speaking the same language, but also have similar or at least compatible cultures.
For instance, Chinese or Indian cultures are very different from the U.S. and that can reflect on how they do business. Eastern European countries are much closer to American in that regard and therefore easier to work with.
On average, Eastern European countries have the highest level of software development expertise and offer a strong return on investment through their low costs. Also, Eastern European countries demonstration the closest mentality to Western brands, which means collaboration could be easier and productivity better, despite the time difference.
But all in all, the best place for software development outsourcing is to the firm that understands your brand and can suit your specific business needs — wherever they might be located! The most important thing is that you select a software development agency that can help you achieve your objectives and continue to grow as a brand.
Of course, that said, you won’t make a mistake if you hire from some other region or country, like China, Russia, India, South Korea, Vietnam, or some that we didn’t cover here, but that also has a great talent pool of professional software developers like Brazil or Argentina.
Ready to find the best software developers for your business? Try these top offshore development companies.