Software Development Outsourcing in Thailand: Pitfalls and Possibilities
Asia was one of the first IT outsourcing hubs to attract international capital. Along with India and China, companies are also interested in software development outsourcing in Myanmar and Thailand. In the last few years, Thailand has been experiencing a digital transformation that impacts all spheres of life in the country.
Outsourcing Thailand becomes popular among different international companies because of the low cost of labor and the new aspiring IT market.
With the governmental focus and effort on digital technology, the IT market in Thailand was predicted to grow by 13% in the year 2019 and reach BT527 billion by the end of the year. The main contributor is still hardware, but digital services will grow by 34%. It becomes easier to hire developers in Thailand for providers all over the world.
The main trends of software development Thailand include:
- Work with Big Data and its analytics;
- Development of Cloud Solutions;
- IoT and smart devices;
- Robotics and 3D printing;
- Web design and development;
- Offshoring Thailand software as a service, etc.
IT services in Thailand might be more accessible in other Asian countries, it is easier to find professionals as there is less competition. For now, software outsourcing to Bangkok is the leading destination in the country. The main workforce and technology parks are located here. Thailand offshoring is characterized by a young and developing market with skilled professionals.
Let’s take a look at the main characteristics of the IT market in Thailand:
- Time zone: UTC+7
- Average Monthly Rate: $1420
- Biggest Tech Hubs: Bangkok (Thailand Science Park and Software Park Thailand), Samut Prakan City, Nonthaburi City
- Size of Talent Pool: about 100,000
Pros and Cons of Software Development Outsourcing in Thailand
IT Outsourcing in Thailand seems quite beneficial for international companies. And like any other IT hub, it has its advantages and disadvantages businesses need to consider before delegating the project.
Pros of software development outsourcing in Thailand
- Low cost of hiring. One of the main reasons why software development outsourcing Thailand is so popular is lower salary rates and other related costs. Software developers in Thailand are educated and ready to work while offering service at almost 60% lower than the US professionals.
- Decent talent pool. Although IT Outsourcing Thailand is a rather new concept, there are about 100,000 skilled developers here. It gives access to professionals that might otherwise be not available in the same country;
- Software Development Services in Bangkok are also easy in terms of control and dealing with deadlines. Local employees have very strong work ethics and culture. But they are polite and friendly at the same time;
- Software development outsourcing in Thailand is less risky in terms of infrastructure as other Asian hubs. There is a relatively stable internet connection and electricity supply. For comparison, a lot of Indian cities still struggle to provide 24/7 electricity.
Cons of Software Development Outsourcing Thailand
- According to the global ranking, there is a pretty low English proficiency. Thailand takes 89th place out of 100. It means that outsourcing your software development to Thailand may be complicated in terms of communication. Although local employees might have some English knowledge, it is probably not advanced enough to use only one language.
- There is a huge time zone difference for European and US clients. It adds to the complexity of software development outsourcing in Bangkok. Traveling is hard and there is little chance to direct and instant communication and monitoring.
- It might be risky to outsource software development to Thailand in terms of quality of work. It is a young market, which means not every programmer has the necessary real-life experience. Also, developers from Thailand haven’t been presented in international ratings like HackerRank or TopCoder. Offshoring to Thailand may result in poor delivery of the product.
- Software outsourcing Thailand is still connected to decent cultural differences with European and US clients.
Thailand software programming market is in development, which means that it provides fascinating opportunities but also risks.
Alternatives to Software Development Outsourcing Thailand
Those who are not sure about IT offshore outsourcing in Thailand probably wonder what the alternatives are. Although Asia has been at the forefront of IT outsourcing, there are other excellent destinations to choose from, for example, Ukraine. It is one of the leading outsourcing destinations in Eastern Europe.
To compare Ukraine to offshore software development Thailand, check out the pros of this European destination:
- Minimal time zone difference with Europe. There are lots of direct flights and easy communication. Depending on the state, there is also a window to have online meetings with Ukrainian developers.
- High quality of delivery. Unlike IT outsource Thailand; Ukrainian programmers have proven their reputation worldwide. For example, they are in 6th place worldwide according to TopCoder and in 11th place in HackerRanking list. Here a business can find highly-skilled and experienced programmers that ensure top-notch quality of services.
- Good English skills. According to Global ranking, Ukraine is in 44th place among other countries. Local companies invest in additional language education and Ukrainian developers have good English proficiency. It makes cooperation much easier.
- Ukraine has a wide talent pool with 200,000 programmers to choose from.
- As a part of Europe, Ukraine is GDPR compliant and shares the same business ethics and culture.
Here’s a list of the main characteristics of Ukraine as a beneficial outsourcing destination:
- Time zone: GMT+2
- Tech talent pool: 200,000
- Biggest tech hubs: Kyiv, Lviv, Dnipro, Kharkiv, Odesa
- Average monthly rate (for middle-level developer): $2000, based on Mobilunity’s Recruitment Team research on the local job markets
All of that shows that Ukraine is an attractive alternative to software development outsourcing in Thailand
Software Development Outsourcing Thailand vs Ukraine: Comparison Table
|Size of a tech talent pool||100,000||200,000|
|Education level||Higher education, mostly BA||Higher education, BA and MA|
|Talent availability||Decent availability compared to other Asian countries, but smaller pool overall||High availability due to wide pool and focus on international cooperation|
|Risks related to natural hazards||High||Low|
|Average monthly rate for middle developers||$1420||$2000|
|Data safety and insurance||Not GDPR compliant||GDPR compliant|
|Quality to price correspondence||Decent, as the rates are quite low, but there is a risk of poor quality delivery||High as the rates are significantly lower than in US or EU and quality is outstanding|
|Ease of doing business||Not very easy because of different culture and low English proficiency as well as time zone difference||Very easy, western culture, good English, simple tax laws, minimal time difference|
Of course, the choice of outsourcing destination depends on the company’s needs, expectations, and finances. It is important to make an educated choice and select a credible local vendor. It will make the process easy and productive.
Mobilunity – Credible Ukrainian Vendor
If you are interested in IT outsourcing to Ukraine, Mobilunity is the partner to trust. We have more than 10 years of experience in outstaffing and can find the best dedicated development team for your project.
We have more than 40 happy clients and many successfully released products. We always focus on the client’s needs and requirements, that’s why we have a transparent rates policy.
But most importantly, we offer access to high-profile and experienced Ukrainian developers that can tackle any project.