Why do businesses choose to outsource web development?

The biggest reason why businesses choose to outsource web development is scarcity of local professionals. When demand is high and supply low, possibilities to hire at a reasonable price are slim to nonexistent.

Why? Demand for IT work grows as technological progress grows.

Spending on various IT services has been increasing for over a decade despite any challenges.

Businesses keep:

• automating processes
• optimizing costs
• launching new services and making them available globally from anywhere

The demand for IT services continues to remain high and will not abate any time soon.

To find, hire, and retain software engineers, businesses can either increase their annual budgets or simply line item and outsource web development.

How does web development outsourcing help?

Here is a list of the most common benefits companies get when they outsource web development:

• Access to missing technical expertise
• Increased control over costs and expenditures
• Overall process improvement
• Decreased pressure on internal development team
• Reduced development and maintenance costs
• Flexibility in adding or removing workforce on a project

Businesses that outsource web development maintain and improve a project at a lower cost while speeding up the software development process.

Businesses that outsource web development can launch a product faster and for less.

And they continue to remain competitive in the long run.

Check out how web development outsourcing helped two IT Craft’s clients keep pace with their plans:

• 

  MyCarrier

  MyCarrier TMS is a startup focusing on the logistics industry. Its founder envisaged functionality that lets users manage less-than-a-truck carriages with just a few clicks. User groups include shippers and logistics companies.

  MyCarrier software contains functionality needed to negotiate on delivery price and schedule and to monitor shipments. Both groups benefit from an optimized truckload and lower shipment expenses.

  MyCarrier has been implemented as a large Web portal that the development team designed from scratch. The client chose Ukraine as the priority destination to outsource web development. The chosen development team became a valuable resource and kept the project on track despite a tight deadline.

• 

  Adorama

  Adorama is a NYC-based family business that focuses on consumer electronics and photography equipment and supplies.

  Adorama’s ecommerce system needed regular updates. The company chose to outsource web development to keep pace with the rapidly changing ecommerce landscape. The scope of work was too large for the company’s internal team.

  Adorama’s own in-house team of software engineers worked with IT Craft’s outsourcing team on various tasks but mainly on back-end development and testing. IT Craft’s team ensured the company’s clients enjoyed fast, uncompromised access to its online store.

More cases

Use these three key steps to outsource web development successfully

The entire process of outsourcing web development includes three essential steps:

• Planning
• search and selection
• project development and launch

It is important to go through all steps carefully to outsource web development with a service provider capable of launching on time and on budget.

• Planning

  Before you start your search, set up your own expectations. Make a list of requirements:

  • Think through what parts of a project or project roles you want to optimize.
  • Be specific about your expectations from your development team.
  • Be clear on how an outsourcing team will help on your project.

  Clarifying the above helps you decide:

  • type of services you require (outsource web application development totally or partially)
  • desired destination for outsourcing web development (Asia, Europe, Latin America)
  • cooperation model (time and material or fixed price)

  Should you outsource web development to a company or a freelancer?

  Unless you have already outsourced web application development, it is wise to search for a company with proven expertise and experience of projects similar to yours.

• Search and selection

  On search and selection step:

  • Make a list of potential service providers suited to your requirements.
  • Conduct interviews with those candidates.
  • Select one best-suited provider. Also list your second choice in case the first is booked up.

  How do you evaluate candidates?

  Choose you outsource web development to a company that:

  • is interested and holds your project as a priority,
  • offers a reasonable estimate,
  • is transparent about pricing on outsourcing web development,
  • can sign an NDA.

  To avoid having to pay for hidden costs, clarify in writing what services are included in the price.

  Not sure whether you are going to outsource web development to a reliable partner? Ask for recommendations from former clients.

• Project development and launch

  In this step, your chosen development team turns project software into reality.

  This is how outsourcing web development workflow looks:

  Sprint 1-4 weeks
  ≈ 2 weeks

  

  The same team continues to work on a project—Sprint after Sprint—until it is launched and through the maintenance stage.

  Remember these following four crucial points for a successful Web app or website launch:

  • Timely communication – a dedicated project manager on the development team’s side and a product owner on your side keep in touch constantly to ensure continual project progress.
  • Documentation – the team prepares and updates project documentation in a timely manner to ensure a smooth knowledge transfer.
  • Trust – you should treat and assist the outsourcing team as your own, so it can excel at what it was hired to do.
  • Cost flexibility – be prepared that costs might vary from initial estimates due to unforeseen challenges.

  Adhere to these four crucial points to help you avert problems on a project or solve them quickly.

How are rates for outsourcing web development formed?

What hourly rates can a business expect from service providers when planning to outsource web development?

This depends. Hourly rates differ based on:

• chosen geographic location
• company’s expertise and specialization
• project complexity and duration

Let’s take a look at each one.

• Geographic location

  The countries with higher cost of living tend to have higher hourly rates and vice versa:

  

  Software development companies from South-Eastern Asia and India offer the cheapest hourly rates for services of web development outsource. However, miscommunication is possible due to different cultural backgrounds.

  Eastern Europe and Latin America are more expensive but still cost-effective regions. Many US- and EU-based companies prefer to outsource web development there due to a strong quality-for-price ratio.

  North American, European, and Australian companies are the most expensive options. In return, businesses get clear, comprehensible communication when they choose to outsource web development to an onshore company. No cultural barriers.

• Company’s expertise and specialization

  Hourly rates for Web app and website development outsourcing vary within a region based on a company’s experience and specialization.

  Companies with proven experience and expertise tend to ask for higher hourly rates. Companies specializing in a particular industry charge more for their accumulated knowledge. Keep in mind, knowledge and expertise mean faster work and greater efficiency. A company with relevant, proven expertise can be the perfect option.

  You benefit. And your clients benefit. The product will be of higher quality, and the total development and maintenance costs will be lower.

• Project complexity

  Obviously, complex projects are more expensive. Other factors affecting cost for Web app and website development outsourcing include:

  • rare technologies
  • expected number of users
  • badly documented legacy source code
  • need to work with rare hardware

  Additionally, businesses need to be prepared for flexible budgeting when they outsource web development of complex projects. A development team, especially an inexperienced team, can spend more time than estimated trying to solve unforeseen problems.

Where do you find a provider to outsource web development?

Try the following options:

• Ask friends and colleagues – some of them might have outsourced web development or worked with a remote team.
• Make Google search – use the keywords “outsource web development” and go through websites of companies you find.
• Use specialized resources – there are narrow-focused catalogues and services helping businesses find and hire a remote team.

Use the following resources to study potential candidates:

• 

  Clutch is a web platform provided by a US-based research company. Clutch publishes verified interviews with real customers and builds rankings on their basis. An extensive search is available. Users benefit from the Lead Matching program.

• 

  Designrush is a B2B marketplace aimed initially at creative agencies, designers, and marketing specialists. However, web development companies are included too. Rankings and search are available.

• 

  Goodfirms is another research and review service. It is similar to Clutch offering users search through a vast catalog of different companies. The platform also provides free reading resources and a community to help outsource web development or any other types of projects.

• 

  LinkedIn is a professional network with thousands of company profiles available. Users benefit from an extensive search. They can refine search results based on multiple criteria and quickly get in touch via messaging.

• 

  Upwork is an online platform where users can find the right contractors for their projects based on contractors’ reviews and ratings. They can outsource web development to both single freelancers and companies.

When browsing through Google search for rankings on a Web platform, take time to carefully read providers’ profiles and reviews. Verification is important.

How to outsource web development projects: In summary

Web development outsourcing is popular. When companies, large and small, outsource web development, they get access to a wide pool of talented engineers. For some businesses, this is the only option to keep pace with competitors and launch a product on time.

However, web development outsourcing is only successful when both the client and outsourcing web development team stay on the same page, clearly understanding each other’s capabilities and limitations, if any.

Below is a recap on how to outsource web development successfully:

• Check provider’s background

  Make sure you outsource to a web development team that can deliver on its promises.

  • Check each portfolio.
  • Study the reviews.
  • Ask each team for client recommendations.

  Schedule a call with the team to discuss your requirements and ensure it has relevant resources to implement them.

• Ensure mutual understanding

  Together with the chosen team, determine the right cooperation model for the project. Discuss your expectations from the project and make sure the team understands them. Ask for an NDA, if needed.

  If you want to test the development team, start with a small pilot task to see how well it can manage.

• Appoint a product owner

  Assign a person responsible for project priorities and timely decisions. This helps streamline the development process and eliminate idle time when the development team waits for approval.

• Guarantee and after-launch maintenance

  Does the team provide a guarantee period? How long? Ensure the same team works during the guarantee period.

  Every software requires regular maintenance. Do you need help from the same team? Or will you hire an engineer in-house? Decide what happens after the guarantee period ends.

• Control over software development

  Does the team develop well-documented source code? Does it accurately prepare and update project documentation? To retain control over your software, you need clarity. This way, you ensure smooth and fast knowledge transfer to other developers.

FAQs

• How do you outsource web development?

  Here is a seven-step approach to successful outsourcing web development:

  • Decide on what you need.
  • Search for a reliable outsourcing provider.
  • Discuss your project with the provider; be upfront about your expectations.
  • Make sure you insist on timely responses from a dedicated project manager.
  • Appoint a product owner or become a product owner.
  • Sign a contract.
  • Ensure transparent communication on the project.
• How much does it cost to outsource web development?

  Costs of a web development project depend on the scope of work to be done and hourly rate.

  A simple project takes $20,000 – $30,000.

  Mid-size projects can cost $50,000 – $60,000 to deliver.

  Prices for complex projects can skyrocket to $100,000+.

  Please note that numbers vary based on region and project details.

  In case of software maintenance, the client pays for the number of hours each developer or team spends on a project every month. Software maintenance costs usually take 10% – 15% from development costs per year.

• What is outsourced development?

  Outsourcing software development means that a company orders development of software, a part of functionality or software updates at a third-party company. Outsourced software development can be total or partial. The latter depends on whether the client’s internal team participates in the software development project or not.

  Benefits of outsourcing software development include lower development costs, access to missing expertise, quality improvement and others.