Nearshore vs. Offshore
in an IT and software development context

Nearshore or Offshore setup?

If you are reading this article, the chances are that you are probably considering outsourcing your software development. Should you go with a nearshore or offshore setup? The correct answer will vary according to your needs, requirements, and what you expect from an outsourcing development team.

With this article, we expect to clarify some questions you may have. So, here are the main differences to keep in mind:

 

Nearshore setup

• Geographically close (1 to 3 hours difference)
• The software development team is in a nearby country
• It´s cost-effective when compared with your local market
• Direct flights available (with a flight duration of 2 to 3 hours)
• Easier to manage due to the short timezone difference
• Similar cultural background

 

Offshore setup

• Geographically far away (6 to 12 hours difference)
• The software development team is usually on a different continent
• Often more cost-effective than the nearshore option
• More difficult to manage due to the timezone difference
• Possibly with significant cultural background differences

 

So, before choosing a setup, there are a couple of aspects to consider.

 

Time zones

Would you prefer to manage developers or a development team available during regular business hours? Or are you willing to manage your development team by email and during non-regular business hours?

 

Traveling

Would you meet with the outsourcing development team face to face regularly? Do you prefer short-distance flights, or are you considering long-distance trips? In some cases, you might want some of the outsourcing team members to visit you, your team, or even your clients.

 

Cultural background

Another essential aspect to consider is the cultural background. No matter how skilled a developer is, cultural differences may play a role in your decision. Depending on the type of project you will outsource, you require developers that can understand the requirements, features, functionality, and so on. It may not look relevant, but social background differences may affect how your outsourcing team will perceive your projects.

 

Communication skills

When talking about perception, it’s also essential to understand how you will communicate with your development team. In what language will you speak? Probably English, right? Is your outsourcing team efficient in that language?

 

Rates vs. Quality

For sure, there are plenty of more aspects to consider, but we believe these are probably the most important. Except for one last detail: hourly rates vs. quality!

Typically, offshore rates are lower, but sometimes this also means lower quality, depending on the country where you will outsource your projects. There are several reasons for this to happen. The offshore team is usually located on a different continent, meaning it will be harder to track the development progress. Also, development standards could be different.

We hope this article helped you understand the differences between nearshore and offshore outsourcing.