How To Find and Hire an Offshore Software Development Team

Competition for tech talents seems to be the next global challenge after Covid. With the shortage of qualified programmers in the US and Western Europe, hiring talented developers becomes costly, and developer staff augmentation offers a more affordable solution. We explain why an offshore development team is a cost-effective alternative and how you can leverage it. 

The Concept of an Offshore Software Development Team

During the lockdown, many companies had to find new ways to cut costs to survive. At the same time, entities were switching to the remote working format. These factors promoted the outsourcing business model.

This means more firms have contracted third parties to complete separate functions. For instance, nearly 54% of global companies use outsourced customer support to assist their clients. And 78% of businesses are happy with their outsourcing providers.

IT outsourcing assumes getting turnkey software development solutions from an agency, and this format suits more and more businesses. However, such cooperation lacks flexibility, and that’s when dedicated development teams come to help. 

A founder or a project manager hires an agile offshore development team and gets functional control over it. We’ll discuss the benefits of offshoring technicians in the next section but would like to share some stats first. 

Some Statistics on Outsourcing 

• Deloitte expects the global market for outsourcing and shared services (OSS) to reach $971.2 billion in 2023. The shares of business process outsourcing (BPO) and IT outsourcing (ITO) equal 21.8% and 53.5% respectively. 
• Statista forecasts that the global revenue generated by the BPO will reach $0.35 trillion in 2023. The US will be the BPO-selling leader with its expected revenue of $127.90 billion this year. 
• The ITO’s earnings in 2023 reached $460.10 billion, according to Statista, while the US will get on top with its $167.90 billion in sales. Deloitte’s researchers also report that 72% of startups prefer outsourcing developers to employing them. 
• When a location has become non-crucial for delivering services, many professionals switch to self-employment. The number of US freelancers only is 73.3 million by the end of 2023. Non-US contractors outsource nearly 300,000 jobs from the USA each year. 

Why Hire Offshore Development Team?

The general stats on IT outsourcing are impressive, but what advantages will offshoring a dev team bring to you? Let’s check its three key benefits:

You’ll Hire Developers with Specific Expertise

9 out of 10 startups end in fiasco, and 14% of those failures happen due to “not the right team.” This phrase describes problems like the absence of a CTO from the beginning, a lack of co-founders, or a team of inexperienced freelancers. 

Forbes also names technical implementation among the top 3 success factors for a tech startup. That’s because innovative and highly scalable companies leverage advanced technologies. For this, new firms need developers with niche expertise.  

• Forbes’ researchers advise to address IT outsourcing providers to find tech experts with your industry experience. So, if, for instance, you launch an e-commerce project, offshore Magento development. This way, you’ll get a top-notch online store with supreme UI/UX design and functionalities. 
• Moreover, with offshore hiring, you can equip your startup with a CTO — the must-have role according to ex-founders of failed tech companies. You’ll be able to get on board a CTO or a project manager with a rare skill set and dedication to your product.
• Qualified PMs, software developers, QA specialists, UI/UX designers, and database administrators will gladly join your team once you opt to offshoring them. 

You’ll Access the CVs of More Technicians 

Startups need skilled developers to create first-class products and scale up rapidly. However, hiring them locally in North America and Australia is challenging. That’s because most tech experts already work for large companies and are happy with their jobs. 

Still, there are plenty of offshore countries with IT hubs that host qualified programmers. And many of these experts work with the tech stacks you need and are ready to accept your offer. Your best-fit coders can live in Hungary, Ukraine, UAE, Mexico, Myanmar, or other remote locations. 

• You’ll get more candidates when checking international freelance platforms with technicians’ profiles. However, if you decide to find offshore development team through a vendor, your chances of getting the right specialists skyrocket. 
• That’s because professional IT recruiters create catchy job descriptions and use advanced LinkedIn searches. Hiring experts surf job portals, check their own talent pools, and leverage partner networks.  
• With polished searching, screening, and interviewing processes and distributed tasks, recruiting teams source tens of relevant resumes within short terms.
• In contrast, a startup team can spend weeks finding candidates, communicating with them, and running interviews. You’ll also need to check legal requirements, sign contracts, and ensure regular transferring of payrolls. 

You’ll Save Costs

CB Insights names lack of financing as the #1 reason for startup failures. 47% of surveyed founders admit this as the key driver of their fiasco. Since maintaining a development team is one of the most significant cost drivers, cutting expenses on your software engineers is critical. 

• Programmers from Eastern Europe, Asia, India, or Latin America often have nearly 50% lower salaries, so it won’t cost you a fortune to hire them. However, paying less doesn’t mean hiring less qualified developers. Remunerations in remote countries are reduced due to the lower cost of living. 
• Still, salaries differ, so you’ll need to compare offshore outsourcing destinations to find the location that fits your budget and tech requirements. Also, the final cost might vary once you engage an dedicated dev team provider
• . Professionals can build your software development team faster and cheaper because they know how and when to communicate with applicants. 

5 Steps to Hire an Offshore Dedicated Development Team 

Suppose we’ve convinced you that having a team of dedicated developers overseas is a good idea. But how to hire dedicated software development teams? Below are five steps to make it.

Define the Final Product, Tasks, and Timeframes

First, you’ll need to describe your product, its functions, and features. Will it be a web app? What will be its architecture? How will it help users, and what will it look like? How will it help users, and what will it look like? Learning how to estimate a software development budget at this stage is essential to manage costs and avoid unexpected financial burdens.

At this stage, you’ll need a CTO, a tech lead, or a project manager to create a project scope with tasks and milestones. You’ll need to clarify the tech stack, the number of technicians, and their roles. 

Set realistic deadlines to plan when your product will go live. Once the team composition and project duration are ready, you can estimate the development costs at various locations. 

Explore Countries for Outsourcing

The next step starts with identifying locations with comfortable time zones. The more shared hours you have with a remote team, the more chances it has to be efficient. It can be Latin America and Eastern Europe — get several countries on your long list.

Also, check some stats on how well developers speak English in these countries. Hiring engineers with at least the B1 level of English will minimize communication blocks inside your team. 

Think of the cultural fit, flexibility, discipline, and finally, cost-effectiveness. You’ll need to check reliable resources that report developers’ salaries in the countries of your interest. Explore monthly salaries of programmers with required specializations. Then multiply these numbers by the months of your project duration.  

Search for Coders or Providers of Software Development Teams 

If you plan to contract developers directly, you’ll need to search for them now. Use local job boards, LinkedIn, and freelance platforms to find candidates. You can register as an employer and promote your vacancies or filter coders’ profiles. 

Try Dice.com, Hired.com, CrunchBoard, Angel.co, and other job boards. Once you find and pre-screen potential co-workers, go to step 5.  

However, this option can work if you need 1-3 developers, as the hiring process is very time and effort-demanding. But once you want to build larger teams, get rare-skilled coders on board, and delegate team-maintaining tasks, you’d better turn to providers.

Vendors that find engineers locally know how to hire offshore development team ASAP and within your budget. 

You’ll have to prepare a list of companies that can potentially build your tech team. Here are several platforms and directories for finding future offshore software development partners and hiring developers directly.

Assess the Providers’ Credibility and Reputation

Now, you’ll need to pick companies with decent and relevant portfolios. To identify experts, craft a list of criteria. They should include location, time on the market, clients’ feedback, corporate culture, and tech stacks. 

Read applicable case studies, explore LinkedIn profiles of the vendors’ CEOs and other C-executives, and check their latest posts and brand communication style.

Also, look through the company’s current and past job announcements. They may reveal specific details like used tools and technologies, working approaches, and budgets of your potential offshoring partner. 

Explore how much time your outsourcing vendors need to find a senior developer and which cooperation formats they offer. 

Run HR and Technical Interviews 

Suppose you plan to offshore hybrid mobile development team on your own, and your short list of candidates is ready. Now, it’s time to arrange interviews. They will include questions about your applicants’ experience, skills, and strengths. 

Ask interviewees how they apply their soft skills like problem-solving, time management, creativity, critical thinking, and leadership. This way, you’ll be able to get a general impression of the person.

The next stage is the technical part of the interview. Here, you’ll need a tech expert to assess the qualifications of your future coders with questions and test tasks. Once you get results, you’ll filter out the best applicants and run final interviews.  

When you hire through a vendor, IT recruiters will manage pre-screening and interviews to vet the best candidates for you. This will save you hours and allow you to join only the last round of interviews.  

Dedicated Offshore Development Team Setup Options

The composition of your offshore dev team will differ depending on the project scope and the tech stack. So, only a CTO can advise on the optimized combination of the technicians to work on your product.

Below are the estimated monthly costs for three teams of various sizes. 

Small Team Setup

*All salaries are net and do not include the service fee (in case of hiring on a dedicated team model). The salaries are provided for comparison purposes and could be not entirely accurate. Contact us to know the exact cost of hiring a developer corresponding to the required parameters.

4 is the minimal number of programmers you need for a project. A senior back-end developer will work on the server databases, while the front-end engineer will create your app’s user interface. The Quality Assurance specialist will test the performance, functionality, and logic of the application.

Medium Team Setup

The medium-size team will consist of 6-7 members. You’ll need to hire 1-2 more middle developers and a UI/UX designer who translates business requirements into technical language and creates user interfaces.

Large Team Setup

The largest team in our example consists of 12 technicians. Now, you’ll have 4 more developers compared to the medium team and a database administrator orchestrated by a project lead.

As you can see from the tables, US-based teams have the highest costs. Germany and the UK offer moderate prices, while Ukraine and Mexico are the most cost-effective destinations if you’re looking for offshore development team.   

However, Mobilunity offers flexible cooperation, so you can save more by engaging some experts (DevOps or PMs) part-time. This way, a small dev team in Ukraine can cost you up to $10,000 per month. 

Leveraging Offshore Software Development: Success Stories and Statistics

For the years on the market, Mobilunity has assembled tens of teams. Below, we share a few brief success stories and some inspiring statistics about offshore software development.  

Mobilunity’s Offshore Development Projects

Let’s explore a few real-life examples of how our team helps clients worldwide. 

• An IoT solutions leader. A Swiss startup lost its key tech talent a few months after the product launch. The company urgently needed skilled developers but couldn’t afford to hire them locally. Mobilunity assembled a squad of 4 that with time expanded to the full-stack team of 11 engineers. 
• Qrates. A Japanese award-winning online music service was supported by an independent programmer working part-time. The company needed a dedicated development team to renew their app and manage the tech debt. The Mobilunity team found a full-time engineer for Qrates in 2020, and by 2022, the team had grown to 5 people. 
• Camptocamp. This well-known European provider of geospatial solutions based in Switzerland contacted Mobilunity in 2017. After several unsuccessful attempts to work with outsourcing vendors, Camptocamp finally found its reliable partner in Mobilunity. The client nearshored a team of 3 Odoo (an open-source ERP) developers with us. Our cooperation continues to this day.

Global Offshore Development in Numbers

• Outsourcing software development quickly gains popularity as it helps save money and improve productivity. By 2025, the sales of the global ITO are expected to reach $481.37 billion, while the same indicator for 2021 was $397.6 billion. 
• Most outsourcing providers are reliable since 78% of global businesses are happy with their vendors. 
• Almost every company decides to offshore software development team to cut its costs. This way, US companies saved 60-70% of their budgets due to hiring engineers in other countries. 
• Most businesses prefer long-term cooperation with their remote teams, while 20% of outsourcing deals end within two years. 50% of the organizations intend to grow their ITO. 

Mobilunity Is Your Reliable Offshoring Partner 

Mobilunity was incorporated in 2010 in Kyiv, and since then, it has built tens of dedicated teams for 40+ companies in 20+ countries. We can find developers with any skills and in any market. Our recruiters work in Eastern and Western Europe, Latin America, and Asia. 

So whether you want to offshore Laravel development in Japan or hire offshore development team in Romania, we’re ready to help. Still, Ukraine remains one of the best offshore locations we work with. Engineers in this country are in demand since they’re professional, business-oriented, open-minded, flexible, and creative. 

2 Cooperation Models for You

One of the factors of our success in the industry is the principle to stay flexible. We offer two ways of hiring your remote developers and are ready to quickly scale teams up once necessary. 

Hire a Dedicated Team of Experts

When you offshore a dedicated development team, each engineer works full-time on your project. We cover legal compliance and back-office support, offering you functional control over your team. So, this format is ideal for large, long-term projects.

• You’ll need a PM who knows how to manage an offshore development team effectively. This expert will set and coordinate tasks, control deadlines, and monitor budget allocation. 
• Our specialists arrange office space and working equipment for your coders. We handle payroll payments, do the paperwork, ensure legal compliance, and pay taxes. Such assistance allows you to delve into tasks without getting distracted. 
• Our monthly service invoice will include developers’ salaries and taxes, sick leaves and vacations, equipment and software, and recruitment and retention fees. 

Engage Part-Time Consultants 

If your project has a small load and/or will last for 2-6 months, the part-time consultancy model might work best.

• You’re free from long-term commitments like office rent or salary payments. 
• Instead, you pay for the hours worked by the developers you engage. We agree on hourly rates and the approximate workload each month. 
• This format will work once you need a tech expert for a few consultations by request or for short-term supervision of mid-level developers. Also, our programmers can, for instance, run trainings for your dev team.
• With this model, you pay as you go, and the rate doesn’t include office expenses, equipment, or retention. You’re free to decrease the volume of work or, in contrast, grow it. 

Looking for an offshore development team? Send the web form to get it hired!

Written by:

Anastasia Stefanuk

Market Researcher

Disclaimer: All salaries and prices mentioned within the article are approximate NET numbers based on the research done by our in-house Recruitment Team. Please use these numbers as a guide for comparison purposes only and feel free to use the contact form to inquire on the specific cost of the talent according to your vacancy requirements and chosen model of engagement.