A nearshore software development team is an accessible option for building effective and high-quality software products. However, one question might be on your mind: what are my options when choosing nearshore companies to partner with? Outsourcing nearshore can be overwhelming, with all the choices available based on your region, but it doesn’t have to be. Different software solutions have specific needs that not every firm is capable of delivering on, so this guide is going to help you understand how to best pick your nearshore teams for your current and upcoming projects.
A valid question you may have is “What is nearshore software outsourcing?” or “How will nearshore outsourcing services help me develop software solutions?” Basically, whenever software companies, or any other kind of company, distribute their tasks to other teams in countries within a similar time zone, they are actively using nearshore outsourcing companies for these jobs. For countries like the U.S. and Canada, Latin America is considered a nearshore location. Not only does nearshore IT outsourcing constitute 64% of outsourced services in the world according to Statista, but Bloomberg reported that 80% of American companies are looking to begin using nearshore development services. This presents a great opportunity to begin looking towards regions like Latin America and begin taking your IT nearshore. Still, only one of your questions was answered here. You’re still wondering about the benefits that nearshore IT services will bring to your software solutions. We talked a bit about the cost saving benefits of hiring software engineers in Latin America in our article here. However, you’re here because you want more than that, right? You want to learn as much as possible about nearshore software outsourcing. We’ll be exploring all the pros and cons associated with nearshore software development companies that will allow you to decide for yourself if software nearshoring services are the right fit for you. We’ve been doing this for more than 20 years now, so we’re full-on experts on this subject.
There are three models associated with software development; onshore, nearshore and offshore software development.
Onshore software development consists of using talent you can find in your local area. Local area implies you are using talent you can find within your own country instead of looking to other options like nearshore software development companies to take on your tasks. This option usually implies higher costs. Projects That Find Benefits When Using Onshore Software Development Are:
Offshore software development involves hiring software engineers or a vendor from a distant country. For the U.S. and Canada, software engineers and vendors from Eastern Europe or Asia would count as offshore software development providers. This solution is by far the most cost-effective form of software development. However, there are a few hidden costs of going with this method that you only see later. The three main challenges associated with off shore software development is the time zone differences, high turnover of software engineers and cultural differences. These shortcomings can be detrimental to your software development projects. Sure, there are a few methods that companies use to mitigate these risks, however they’re not bullet proof, and sometimes requires more effort to make work than the benefits they bring. Projects That Find Benefits When Using Offshore Software Development Are:
Nearshore software development, as we’ve already established, is an outsourcing model involving companies and software engineers within countries and continents that share time zones and that are more affordable. This means that, similarly to offshore software development, you’d be exercising a valuable cost-saving strategy, while also expanding your activities with a nearshore software development team within the same time zone. What is nearshore? It’s the best of both worlds. Practicing software nearshoring is a growing popular strategy for many businesses in North America. From the everlasting tech talent drought countries like the U.S. have been facing over the past few years, to it’s cost benefits, it’s no wonder software development has been growing in the region. On top of that, the Pandemic gave an example of how effective remote work can be, allowing companies to begin nearshoring their development for new features or simply keeping their products functioning. Many types of companies have benefited from this method, but SaaS companies have had a real benefit from nearshoring SaaS development tasks. Contact us to find out a little more Projects that can Benefit from a Nearshore Software Development Team
Working with nearshore software development companies and software engineers gives you an extended team that works truly alongside you thanks to sharing similar time zones. This avoids that delay you see with offshore teams, always working one day after something is done with your internal team. This also makes real-time collaboration with your own internal team less difficult to manage. Software development projects with offshore companies can feel disconnected with everyday activities due to different time zones. Plus, if face-to-face collaboration is required, organizing travel to a nearshore software development provider is easier than trying to do the same with an offshore provider.
We’ve already shown that Latin America is a big player in the outsourcing market as a whole, but a surge of economic growth was projected for this year when it comes to the IT sector, an 11.1% increase from last year, precisely. With Latin America growing in potential in the tech industry, opportunities for leveraging this trend are already being identified and picked up by quite a few companies in the North America. So, the time to start nearshore software outsourcing with Latin America is now!
Technology’s constant evolution is not stopping anytime soon, meaning that the demand for software engineers and developers is going to go strong for a while. Still, there is a lack of top tech talent available in the U.S. Latin America is a gold mine of tech talent ready to get started and be a part of your software development team. We already passed through a phase where remote work was proven to be as efficient, if not more so, as working face-to-face. So consider checking out the talent you can find in Latin America for your next software development project.
The last thing you want to experience is miscommunication with your software development team and have that impact the development of your product. Nearshore software outsourcing with Latin America gives you access to a talent pool that not only speaks their native language (Spanish or Portuguese for Brazil), but also English, making communication with a nearshore software outsourcing team from any country in the region easier than offshore alternatives. Plus, the culture fit between the regions also eases communication. Alignments are much stronger with these countries, making the teams you build with them more cohesive than their offshore counterparts.
If your budget has you concerned, but are reluctant to compromise on quality or development time, nearshore software outsourcing is perfect for you. Nearshore alternatives are defiantly less cost-effective than offshore options, however the value they provide makes the investment you do put in worth while comparatively. Think of the proximity of onshore software development teams, with the cost-effective benefits of the offshore teams. Once again, what is nearshore? The best of both worlds. The best thing about nearshoring is that their model best suits projects looking for accelerating their software development process.
The short answer: it depends. As we’ve said before, nearshore software development companies focus on outsourcing to teams in countries that are close to their own. In our case, we’ll be focusing on Latin America for our nearshore software outsourcing analysis.
We’ve said it before, Latin America is a popular choice for nearshore software development. From how close it is to the U.S., to the strong talent pool of software engineers you can find, you’d be hard pressed to find anything wrong with the offer. Deloitte themselves have mentioned that many international players are establishing an engineering presence in Latin America, form across various industries. This further puts into perspective just how much the region is growing in terms of it’s technological significance, and you should start considering it as well. Here are a few examples of countries in Latin America that you should be keeping an eye on:
Argentina alone is projected to grow in the software development industry, reaching revenue of $911.50M by the end of the year. With a highly educated workforce and home very relevant tech giants in the region, such as MercadoLibe, Despegar, and Mutt Data, software development talent will not be hard to come by. Not only that, but the quality of the code produced in by Argentinian software development teams are always praised as some of the best. Nearshore software development with Argentinian developers will aways be a good choice for your next software project.
Another solid choice when it comes to options, Brazil is the largest country of the region, as well as the most populated. To put it into perspective, their software industry is projected to produce $9.17BN by the end of the year. They also have their own selection of high-profile tech companies, like IFood, InfoPrice, among others. Large talent pool? Check. Pedigree? Check. Should you check out the nearshore software development companies and talent available? Yes.
In 2021, Chile’s dynamic IT industry made up 2.7% of its national GDP, showcasing its swift tech progression. On top of that, according to the International Trade Administration‘s findings, Chile leads in internet usage across Latin America. Chile is also one of the countries in Latin America fully committed to bringing the country into a digital future. They also provide a wide range of software development services, from basic applications to intricate systems. Major players like Microsoft are already leveraging the talent you can find for tech. Why aren’t you?
Colombia itself has a strong software development ecosystem, rooted even in their education system. With universities and research institutions supporting the software development industry, it’s one of the options that can best help you begin your nearshore journey.
Costa Rica is a small but developed country in Central America with a growing software development industry. Not only is its participation in the industry growing by the day, but it’s also one of the countries that are best positioned to attend to technology needs in the U.S. With an extremely close proximity to the U.S., with an internet coverage across the country of almost 82%, Costa Rica is optimally positioned to bring man nearshore software development benefits to North American businesses.
Positioned adjacent to the US, nearshore software development in Mexico is bound to receive some serious benefits compared to other countries throughout Latin America. If Brazil’s $9.17BN revenue generation for the year is impressive, Mexico exports over $20BN in software development alone. Mexico’s rich talent pool, alongside the presence of top tech giants and the government’s push towards technological development makes Mexico a great hub for software talent to find.
Peru is a prominent software development destination in Latin America and is performing well in the industry. It’s proven resilient throughout the pandemic, boasts top-ranked universities and possesses many competent developers in the territory. Like many other governments, the Peruvian government has also been investing in technology development, intending on attracting tech companies to establish a presence in their country. Nearshore software development will be greatly appreciated as an integral part of the Peruvian economy within the next few years.
Want to learn more about the nearshore software development in Latin America? Looking to hire a nearshore software development team for your own project? Contact us and find the top nearshore software development team for your project!
Teravision Technologies is a nearshore software development firm headquartered in the United States. We help companies accelerate their software products and take them to the next level, allowing them to reach their goals. We’ve been doing this for over 20 years, and we’d love to help you deliver your software products on time and meet your goals.
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