How to Hire Offshore Developers
The maintenance of a large staff carries serious financial burdens even for the most successful company. In addition to paying high salaries in the IT sector, You have to pay considerable taxes, prepare reports for inspection bodies and resolve a lot of other formal nuances that require investment of time and money. It is therefore not surprising that many companies are beginning to take an interest in hiring offshore software developers. We suggest that You not apply such measures and consider a financially profitable, but completely legal way to hire employees. It's about the so-called outstaffing. It implies that the employee is legally registered on the staff of the recruiting company, and You simply "hire" him to carry out certain projects. We are responsible for a specialist to the regulatory authorities, and the payment for our services for the search and provision of personnel for You, as for an employer, will not be comparable to the costs of maintaining an employee on your staff.
The best way to save on staff costs
Remotal is an experienced recruitment team that specializes in IT. We know how to choose good professionals for any client's needs and offer a modern, profitable, convenient way of employing personnel. We are in touch and ready to discuss details. We will be happy to help You with a successful and economic expansion of the staff.
Guide on How to Hire Offshore Developers for Your Project
According to a survey conducted by Deloitte, nearly 74% of IT companies prefer to hire offshore developers as opposed to in-house workers. Especially if your business is located in one of the biggest and most expensive cities like London, New York, or Paris, the cost of recruiting an in-house developer will devastate your budget. That’s why it has become so popular to hire offshore web developers. Going offshore will save you a substantial amount of money, and at the same time, give you access to a much larger pool of talents. While CEOs in megacities cut their expenses by outsourcing, executives in smaller towns prefer offshore experts due to the greater talent pool, which is unavailable in their location. However, as amazing as it sounds, outsourcing does come with its disadvantages, pitfalls, and complications. Being new to this type of recruitment, you might overlook traps. In this blog post, we’ll answer the question of how to hire an offshore development team, describe the most beneficial cooperation models, and list the countries that are the best for hiring offshore developers. Read on to learn to find out crucial tips for signing a contract with an offshore
Table of des Matières
01. 4 Reasons to Hire Offshore Developers
- Increased productivity
- Larger talent pool
- Flexibility
- How to Choose the Offshoring Model
- Fixed price engagement model
- Time and material model
- Dedicated development team engagement model
4 Reasons to Hire Offshore Developers
As nearly 82% of startups fail because of cash flow problems, the offshore market saves the day. If you want to cut the expenses of your project and not go overboard, hire a dedicated offshore software development team. Instead of spending money on office rent and equipment, payroll, insurance, sick leaves and vacations, and many more, you will be channeling this money towards the most important part — your product and business development.
Besides cutting costs on various perks and fees, you will decrease your monthly bill by recruiting developers from leading offshore countries with a slightly lower income. Specialists in Eastern European, Asian, and South American countries will charge two or even three times lower paycheck than their counterparts in North America, Australia, or Western Europe, having the same skill set and expertise.
Increased productivity
When you hire an offshore development team, not only do you save money but also boost the overall productivity and achieve results quicker. When recruiting a new team of engineers, they will have to go through onboarding, training, learning the intricacies of your corporate culture, and so on. While an offshore team of professionals are here to deliver a certain increment. Besides that, an offshore software development agency will also take care of the HR activities and handle project management so that your team can focus solely on the development from day one.
Larger talent pool
By including offshore programmers in your project, you expand the radius of the search. Surely, there are many highly talented people in California or Berlin. Still, chances are that they are already happily employed at a successful corporation and receiving tons of enticing bonuses. If your business is new or relatively new, you don’t have these perks to offer in the first place. Luckily, there are plenty of talented and eager to work coders worldwide who will gladly agree to work on an interesting project and expand their portfolio.
Finally, when you hire offshore app developers, you make your business more diverse and inclusive, bring in new points of view and perspectives, which adds to the overall product quality and improves employee engagement.
Flexibility
Changes and adjustments on the go are quite common for startups. For a particular project, you might need to scale up your team, switch to a different technology, relocate to a new office, etc. When you are tied down to an in-house team of software engineers, you are bound to face inflexible and cumbersome processes. However, if you hire dedicated developers offshore, you will be able to easily and effortlessly move them between the projects and tasks.
Offshore
In-house
Cost
Significantly reduced
A lot of extra & hidden costs
Productivity
Increased due to the specific task they are hired to perform
Varies as they might be assigned various in-house related tasks at the same time
Talent pool
Global
Local
Flexibility of change
Highly flexible to scale up and down on demand
Tends to be cumbersome
Transparency
Low
High
Corporate culture
Employees are not a part of the corporate culture
Employees involved
How to Choose the Offshoring Model
Before moving forward with the idea of hiring a team of developers, you need to familiarize yourself with the three models for outsourcing your projects. At first, go through the following checklist of requirements for your future team of coders:
Type of project
Budget approximation
Scope flexibility
Time-to-market
Deadline for the completion
Project management
Defining them first is essential for choosing the cooperation model and your future workflow.
Fixed price engagement model
This is a low-cost strategy for a company with a limited budget and a definitive idea. The main feature of this approach is that both cost and scope are fixed, which leaves barely any room for change.
In order to make this model work, you will have to work hard during the discovery phase and plan ahead. Otherwise, you will face uncertainties and difficulties that will inevitably lead to extra costs. We recommend defining every little increment of the project before you begin.
Time and material model
The T&M model is known for its agility and flexibility, allowing you to reshape your project according to ever-changing requirements. This model allows you to change, add, or remove features on the go as well as rethink the technology, design, and many other aspects.
On the other hand, this approach doesn’t imply a fixed budget, making planning much harder. Despite this drawback, the T&M model reduces management overhead costs and delivers many benefits.
Dedicated development team engagement model
Finally, the third model offers the ultimate flexibility and freedom. You can cherry-pick developers, designers, QA managers, and project leads to complete your existing team.
After evaluating your team and drawing up the project plan, you will recognize the gaps and choose only those offshore developers for hire who will execute a certain project successfully.
This model allows you to keep control of every stage of the process and scale up or down at any time. Finally, working with a vendor, you will release yourself from the duties of recruitment, providing equipment, and infrastructure.
The Best Countries for Hiring Offshore Developers
Of course, if your budget allows, you can hire development teams from everywhere. However, if you cannot afford to pay more than $3,000 – $4,000 per month, the list of potential candidates shrinks. But don’t worry, there are plenty of countries where people would gladly work for you because of the different cost of living. This list includes Eastern European countries like Ukraine, Belarus, Russia, Serbia, Bulgaria, and Romania; some Asian countries like India, Vietnam, Pakistan, the Philippines, and South and Central American countries like Argentina and Mexico.
However, before jumping into a new business relationship, consider factors like time zones, cultural compatibility, political situation, geographical location as well as inflation rates. Secondly, define your priorities: money or quality? You can’t have both, so you will have to sacrifice some quality if you have a very tight budget.
4 Methods for hiring offshore developers
There are various online platforms where you can find freelance or remote professionals who will fit your budget and meet the project’s requirements. Let’s take a look at the four places where to hire offshore specialists.
Outsourcely
If your budget is very tight, consider taking a look at Outsourcely — an online tool that gives you access to candidates from 132 countries. With prices starting at $9 to $99 per month, it is a perfect platform for small businesses that cannot afford top rated developers who charge high. The website allows you to contact candidates right away via chat or video calls as well as email. Unlike most online marketplaces, Outsourcely does not charge extra fees and lets you directly contact and hire workers.
Upwork
Upwork is one of the most popular marketplaces for finding talent. Having an enormous online presence and brand awareness, they provide both remote workers and employers with a tool to find their match. However, Upwork does charge the workers 10% of their salary and adds employers 3% to their deal with freelancers to make money and continue to offer great services.
TopTal
TopTal is an outsourcing company that is known for its thorough vetting process. They claim that nearly 3% of all applicants successfully manage to pass their technical tasks and become eligible for hire. Having such an exhaustive selection process, they provide only an exclusive workforce. That is why it is a perfect platform to look for a senior member of your team.
GitHub
GitHub is a well-established website where programmers can exchange valuable information, write how-to’s, reviews, leave feedback, and share codes. Being a huge community of programmers, GitHub has created a job page where developers post their candidacies, skills and show their coding talents. Here, you will get access to a huge pool of candidates: from students to seniors.
How to choose from offshore software development providers
After defining your goals and setting priorities, dive deeper into the vendor hiring process.
Ask many questions
You will be working together for quite some time; ideally, you will establish long-term cooperation, and the vendor will supply you with great workers for all your future projects. This is why a cultural, philosophical, and methodological client-vendor match is so crucial.
Ask the vendor about their approach to software development. Do they apply agile methods? How good is their communication flow? What are the deliverables at the end of every stage of the development process?
Wonder about their previous experience with a similar project. Ask them about the projects, their goals, and processes as well as results. Don’t hesitate to request references.
Ask them about the potential risks of outsourcing software development and how to mitigate them. This will help you understand their values and approaches as well as the representation of customer support.
Check their security policy
Many businesses face cyber risks like phishing attacks and security vulnerabilities, so an established security policy is necessary for protecting your data.
There is a list of recommended and mandatory practices that your offshore software development vendor should comply with to guarantee maximum safety for your project.
To ensure the safety of confidential information, make sure the vendor adheres to standards such as ISO 27001:2013, PCI DSS, ISO 9001:2015, HIPAA;
Both internal and external audits regularly take place in the company in order to comply with recommended security policies;
The vendor demands strong passwords from its employees as well as regular password resetting;
The company is fully transparent about the means through which the data is stored and transferred.
Finally, consider consulting with a local attorney to get legal advice and check over the contract.
Cultural fit
Cultural backgrounds are often underestimated when making a business decision. However, it can influence the way the work is handled, employee satisfaction, and quality of communication. At this stage, you need to decide whether cultural differences, time zones, and language gaps will affect your project’s quality and flow.
On top of that, make sure you share the same management style with your prospect vendor. If your vendor mistreats workers, it will be transferred to your employees as well and lead to poor quality and productivity.
5 Tips for Signing a Contract with an Offshore Development Company
There are myriads of pitfalls that you can encounter when signing a new contract. The most important step is to be thorough and read it from the top to bottom to make sure you understand everything it says. Before you go ahead and sign anything, learn our tips.
Time limit and deliverables
First of all, think about deadlines and deliverables and include them in the contract. Every step of the development process that can be considered as a milestone should be assigned a certain date of completion. It is important to keep them on paper so that the vendor can be held accountable for a breach of contract.
Payments
Schedule payments in accordance with the project increments mentioned above. It should be clear from the contract how, when, and how much should be transferred to which account. Make sure to include the information about the consequences of failed payment as well as a not completed project.
Always keep in touch
Clarify in the contract via which platforms and how often you will be communicating with the vendor to receive updates about the process. You should have access to the project progress and all the data concerning the course of development.
Security
Include a paragraph about data protection and storage to make sure your information will not be used without your knowledge and agreement. Also, add a notion about your ownership of the code. Further, if the contract is signed between two parties from different countries, don’t forget to specify based on which country the laws will be governed since they might vary. Finally, sign an NDA to secure your assets.
Success Stories of Offshoring Software Development to Remote Teams with Remotal
Besides a multitude of benefits that come with outsourcing, you will face a number of difficulties. In order to experience a smooth transition and carry the least amount of losses, refer to professionals like Remotal.
Remotal is a company that facilitates different types of collaboration to help you achieve the best results. If you would like to hire a dedicated development team and avoid possible traps and poor decisions, contact Remotal to receive a consultation.
We have helped many companies better their teams and create their best products.
Tribe & Co
Tribe & Co is a consulting agency specializing in major transformation programs, passionate about collective dynamics and intelligence. We assist Tribe & Co in the development of their event organization tool and provide the services like project management and on-demand CTO.
Spark
Spark.do is a digital marketing agency and tech platform. They struggle to hire high-level developers due to the lack of Ruby on Rails specialists in the French market. Remotal offers them full support in finding senior profiles for Ruby on Rails.
Final Thoughts
If you are a tech startup, the best option for you is to hire top offshore developers. However, prior to signing a contract, define the requirements and the skill set, calculate the budget, and begin your search. And don’t underestimate the importance of cultural differences when making a decision.
If you have any difficulties or remaining questions about any step of the way, contact Remotal to receive more detailed and personalized information.
