Although traditional offshoring cut costs, it usually had drawbacks. Businesses often report communication difficulties and logistical nightmares. Nearshore software development is a potent alternative that is currently changing how businesses create software.
Businesses that choose nearshore development can benefit from a number of factors, such as substantial cost savings, easy collaboration facilitated by similar time zones and cultural affinities, and access to a talented talent pool.
Perks of Nearshore Software Development
Budget Saving with the Same Level of Quality
Companies often choose nearshore development because of the significant cost savings when compared to onshore engagement. Moreover, without the harsh trade-offs usually associated with offshoring. Even though labor costs are lower due to the different economic standards in neighboring countries, the value goes beyond hourly rates.
For instance, a programmer who works in the UK might make a lot more money per hour on average than a specialist in Eastern Europe. These savings help businesses to devote resources to other areas, including innovation and marketing. Additionally, being close by lowers hidden costs like difficult site visit travel and costs associated with misunderstandings and project rework. Projects usually have a higher return on investment (ROI) because there are fewer unanticipated costs.
Superior Operational Effectiveness
For operational workflow, time zone alignment is revolutionary. The time difference might only be one to three hours for a U.S. business collaborating with a team in Mexico or Colombia. A lengthy window for in-the-moment collaboration is created by this overlap.
- Flexible and Adaptable: Teams can synchronously carry out sprint planning, feedback sessions, and daily stand-ups. For Agile development approaches that depend on quick feedback loops and ongoing iteration, this is essential.
- Quicker Time to Market: Project timelines are accelerated by prompt decision-making and prompt problem-solving. Waiting a full day for a response can significantly shorten development cycles and speed up product release.
- No More Night Shifts: Reducing the need for employees to work erratic hours raises morale, improves the caliber of their work, and increases employee retention.
Harmony Between Cultures and Easy Interaction
An important element that is frequently disregarded in outsourcing is cultural compatibility. Similar work ethics, business procedures, and even holidays are frequently shared by nearshore partners, reducing the possibility of miscommunication and promoting a more organic, fruitful working relationship.
According to a study referenced by one source, cultural incompatibility accounts for 69% of outsourcing deal failures. This risk is immediately reduced by nearshoring.
The Door to Large and Skilled Talent Pool
The global shortage of skilled IT workers is a headache for many companies. Nearshoring makes it possible to access up-and-coming tech hubs with an abundance of skilled developers.
A highly skilled workforce skilled in contemporary technologies and Agile methodologies has been produced by countries that have made significant investments in STEM education, including Eastern Europe, Mexico, Brazil, and Costa Rica.
This allows businesses to quickly find specialized knowledge in fields like cloud computing, artificial intelligence, or mobile development that might be difficult to find or prohibitively expensive locally. This access enables businesses to quickly adapt to changes in the market and project demands by scaling their teams up or down with ease.
Improved Security, Quality, and Control
Geographic proximity between a client’s and a nearshore vendor’s offices allows greater oversight and integration with the internal team. Without the hassle of long-distance travel, in-person meetings, workshops, and site visits can be scheduled, improving project management and partnership dynamics.
Clear communication improves understanding of requirements and facilitates more effective integration of feedback. Furthermore, many nearshore countries provide greater peace of mind than some offshore locations. The reason is their legal frameworks for data security and intellectual property (IP) protection that are in accordance with American and European standards.
List of the 10 Best Nearshore Developers
Belitsoft (Eastern Europe)
It takes more than just a technical skills list to find the best nearshore software development partner. It involves evaluating a company’s collaborative DNA, strategic alignment, and ability to function as a true extension of your team. Belitsoft is a strong contender for companies in the UK and Western Europe looking to hire engineering talent from Eastern Europe, according to a thorough analysis of its products and customer reviews.
Clients in London, Berlin, or Stockholm can collaborate in a highly compatible time zone – often just one to three hours apart – by partnering with Belitsoft’s teams in nations like Poland.
The agency has demonstrated a breadth and depth of knowledge earned over 20 years in the IT industry. The company boasts strong full-stack capabilities and specializes in the Microsoft technology ecosystem, which encompasses Azure cloud services and .NET. Additionally, Belitsoft has shown expertise in data analytics, cloud migration, AI, application modernization, and cross-platform development (Python, React).
Belitsoft has a solid track record, which is the real indicator of a “best-in-class” partner. Belitsoft’s record of enduring client relationships – averaging more than five years – as a testament to its ability to provide consistent value and adapt to the changing needs of its partners. With over 50 specialists having stayed for seven years or longer, and an average tenure of four years, this fosters dedicated teams with a startup mentality.
Partnerships with Fortune 1000 businesses and forward-thinking startups in sectors like finance, healthcare, and e-commerce make up the company’s portfolio.
Public client testimonials frequently highlight Belitsoft’s reliability, code quality, and ability to seamlessly integrate as a trusted partner rather than a remote vendor. Belitsoft has received perfect 5/5 Gartner Peer Insights scores in every category, and customers characterize the company’s teams as “creative, knowledgeable, and flexible.”
Accenture (Ireland)
Accenture is a highly regarded IT consulting firm and a global leader in professional services. Originating in the West, it offers everything from technology implementation to strategy and consulting. 94 of the Fortune Global 100 companies are served by Accenture’s specialized Microsoft solutions practice, which includes .NET and Azure.
Because of its technological thought leadership and ability to handle large software development and integration projects (often through its Avanade joint venture with Microsoft), it is a top choice for enterprise software development needs. Because it is a Western-based company, its services are expensive; development teams in the United States and Western Europe frequently bill well over $100 per hour.
Instead of focusing on cost-sensitive outsourcing projects that mid-market companies might be interested in, Accenture usually pursues high-budget projects for Fortune 500 and government clients. Accenture is a good choice if money is no object and a project calls for hundreds of consultants, but not if you need a more reasonably priced, highly skilled team without the high overhead.
IBM Global Services
For many years, IBM’s Global Services division has been a titan in systems integration and IT outsourcing. Known for its own platforms (mainframes, Java, etc.), IBM has over a century of technological leadership and collaborates with clients worldwide on significant application development and modernization projects.
It is frequently listed at the top of Gartner’s rankings for IT services providers and has worked with large corporations in a variety of industries, including government, telecom, and finance.
IBM is a leading provider of software development services due to its extensive resources, research and development (in cloud, AI, etc.), and global delivery centers. IBM Global Services works on highly regulated, multi-million dollar projects.
A single app development may be a component of the broad IT transformation that typically characterizes its engagements. This indicates that for clients looking for simple outsourcing, IBM’s offerings are overkill (and over budget). They don’t offer custom software solutions and agile software development teams free from overhead and red tape.
Toptal
Toptal is a marketplace and talent network for on-demand hiring of top-tier independent developers and other tech specialists. The “top 3%” of freelance software talent worldwide is vetted and made available by Toptal.
Instead of completing projects internally, Toptal connects businesses with pre-screened developers (as well as designers, PMs, etc.) who work remotely as a part of the client’s team. The sourcing and matching procedure is managed by Toptal.
Toptal is a software company that brokers individual contractors rather than carrying out projects; the client still oversees the daily development work. They don’t offer development services that are fully managed by their own teams.
Toptal is expensive (premium hourly rates) and frequently utilized for highly specialized or temporary tasks. Toptal’s model would be less appropriate for clients looking for long-term, reasonably priced dedicated teams. Since Toptal is an outsourcing middleman for staff augmentation rather than a conventional development agency, it does not offer a full-project delivery model.
Cognizant (United States)
A major provider of IT services, Cognizant creates unique apps and updates outdated software. Cognizant can also integrate data analytics and artificial intelligence into your applications. Assembling programmers from India lowers costs when compared to hiring in the US or Europe. As needed, Cognizant can swiftly add more personnel to your software development project. With so many remote engineers, maintaining consistency in quality is difficult.
The largest obstacle is that the majority of your engineering team will be more than twelve hours ahead of you or behind you. You only get a few hours that overlap with US or European time zones because the majority of development takes place in India. Only in the early morning or late at night can real-time collaboration take place. English is spoken by Indian offshore teams. You might, however, encounter overly formal communication, poor English proficiency, and a lack of cultural alignment.
Globant (Latin America)
Globant has expanded quickly and is now regarded as one of the biggest IT consulting and software development companies to come out of Latin America. It employs tens of thousands of developers, consultants, data scientists, and UX/UI designers. It has significant development centers across Latin America (Brazil, Mexico, Colombia, Uruguay, etc.), with its operational center located in Argentina. Although they are typically on the upper end of the mid-market or seeking premium digital expertise, mid-market clients may also work with Globant.
Globant is frequently linked to cutting-edge digital solutions, UX, and front-end innovation. Although it is capable of producing enterprise back-ends, its focus is on front-end and creative projects. While Belitsoft’s Eastern European engineering culture might be better suited to a project which calls for strong architecture and algorithmic rigor (like a fintech engine or a healthcare system back-end), Globant might feel more at ease perfecting the user experience for a global consumer app.
Nearshore rates in Latin America are typically higher than those in Eastern Europe, and Globant, a tech company listed on the New York Stock Exchange, frequently charges more for its services. Beyond core development, Globant may include additional roles (designers, innovation consultants, etc.) that incur additional costs. Globant’s flagship accounts – international brands with significant contracts – naturally attract its attention.
Globant’s top team may not be assigned to a project for a mid-sized client unless it is extremely innovative. Globant is a fantastic option for large enterprises looking to combine design and technology with a substantial budget.
HCLTech (India)
With more than 220,000 employees worldwide, HCL boasts a sizable pool of developers, including architects and subject matter experts. They are able to put together sizable, committed teams for a project. Because of their emphasis on innovation and research and development, HCL integrates best practices (such as CI/CD and automated testing) into project execution and makes extensive use of agile and DevOps practices.
Due to lower offshore rates, HCL’s pricing is comparable to that of other Indian companies. This saves the client money on enterprise projects. However, compared to smaller vendors, HCL may have higher engagement minimums and usually pursues high-budget contracts.
Large-scale development thus benefits greatly from HCL, but smaller projects might find it more difficult to use. Clients must get used to some early-morning or late-evening calls because, like any India-based provider, a lot of development occurs in India. It is customary to communicate formally. Each developer is thoroughly screened and incorporated into the project because HCL does not have smaller, more specialized teams. This prevents anything from getting “lost in the shuffle,” which can happen with HCL’s large teams.
Tech Mahindra (India)
Tech Mahindra’s developers are proficient in DevOps procedures, cloud solution setup, and the migration of legacy systems. They have banking and telecommunications experience. For example, they can create digital banking applications or develop a system to help telecom firms handle their services.
With tens of thousands of workers, Tech Mahindra is a big business. They can supply a wide range of expertise to big teams, including business analysts, UX designers, testers, and software engineers. Southeast Asia and India are home to the majority of their delivery facilities.
For an Indian outsourcing business, their rates are reasonable. However, they might have non-flexible contracts or minimum team sizes, just like other large Indian companies. There are trade-offs when working with Tech Mahindra’s offshore team. You will most likely need to join calls at odd hours due to time zone differences with North America or Europe. Due to the distance, communication may be slower. It could take longer to plan some projects.
Atos (Western Europe)
Atos is a global provider of IT services and consulting, similar to Capgemini or Accenture, with its main office located in France. They construct massive, intricate enterprise systems for governments, businesses, and banks. They are pricey, though, just like other Western consulting firms. Senior Atos consultants in North America or Europe charge exorbitant fees. For routine software development, mid-sized businesses cannot afford Atos. Large contracts, not comparatively small applications, are what Atos is looking for. Dealing with Atos entails bureaucracy. Changes must be approved by several committees and managers. That is slow, and using Atos to change course quickly might be challenging. Fortune 500 businesses with substantial budgets and tolerance for sluggish procedures are served by Atos.
NTT Data (Japan)
One of the leading worldwide IT providers, NTT Data employs about 190,000 people and caters to a vast array of corporate customers. Usually included in its larger consulting and outsourcing engagements, NTT Data’s development services include managing a Fortune 500 company’s whole application portfolio or delivering a portion of a sizable government system.
Due to its size and wealth, the company is highly dependable for big businesses (much like IBM Global Services). This also implies that NTT Data is not designed for small, targeted projects. Pursuing mega-deals and enterprise outsourcing contracts is its business strategy. Because of this, mid-sized clients looking for a custom application or a dedicated team may get lost among NTT’s numerous large clients.
While using offshore centers, the company’s pricing is tailored for enterprise budgets and would result in significant process overhead. For a typical development project with a tight budget, clients typically find better collaborations with firms that provide hands-on engagement, quicker turnaround, and transparent pricing.
Core Factors to Evaluate when Selecting the Best Nearshore Software Development Vendor
Prior to evaluating potential partners, it is essential to have a comprehensive internal understanding of the goals and requirements of your project. This essential step ensures that you can effectively identify the business that best suits your unique situation.
Clearly Define the Goals and Parameters of Your Application
Start by clearly stating your project’s vision, business goals, and particular technical specifications.
Determine whether you need a dedicated team for a long-term product build, staff augmentation to fill skill gaps, or a team for a project with a set scope.
In addition to providing a clear standard for evaluation, a well-defined scope that covers the desired technologies, deadlines, and deliverables aids potential partners in submitting accurate proposals.
Check Industry Experience and Technical Qualifications
Verify potential vendors’ knowledge in the specific frameworks, programming languages, and tools you are looking for your project.
Look through their previous work to identify projects that are similar to yours in terms of size, complexity, and functionality. A business that has relevant industry experience will be better able to foresee problems and follow rules unique to its industry.
Examine the makeup of their teams to ensure that they have competent developers, project managers, QA engineers, and other key roles.
