Onshore vs. Offshore: Benefits of U.S.-Based Custom Software Development Firms Blog Feature

By: Jennifer Devitt on November 1st, 2017

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Onshore vs. Offshore: Benefits of U.S.-Based Custom Software Development Firms

Business Management

Choosing to outsource your development work to a custom software development firm is one thing—but are you planning on contracting an onshore team or an offshore team in another country? Although cost is often a driving factor in outsourcing, you need to make sure that your choice of team is worth the money that you'll be saving up front.


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Offshore Development

Pros

In the overwhelming majority of cases, the main advantage of going offshore is the cost savings. There are good-quality developers offshore, of course, but there are good-quality developers in the U.S. as well, who typically charge a higher price.

Cons

  • Time zones: An offshore development team may be sleeping at exactly the time when you need them most. Even setting up a schedule for regular calls is more difficult.
  • Language barrier: Depending upon the company you are looking at this may or may not be an issue, but there may be a language barrier to consider when working with an offshore developer.
  • Speed: Because you aren't working at the same time, the project might take a lot longer to complete. You'll see the offshore team's messages and code hours later, rather than right away, and the team may take hours to respond to you.
  • Legal recourse: If you're not happy with what you received, then it's very difficult at best—and impossible at worst—to get your money back through legal means.
  • Maintenance: The code may be written in another language, which makes it harder to understand and more difficult to do support and maintenance for in the long term.

If you do plan on going offshore, it should be a company with a physical address and a track record rather than an individual person. Try to find reviews and information about them on freelancer websites. In the end, whether you go onshore or offshore, you should be looking for the same things: a company that understands what you want and has the experience and portfolio to prove it can succeed.

There are legitimate offshore development companies out there, of course, but also legitimate concerns about working with them. If you have any suspicion that an offshore team is being suspicious or dishonest, then it makes sense to stay away. Unfortunately, too many people ignore the red flags because they prioritize the cost above everything else, instead of worrying about if they'll really get what they pay for.

Onshore Development

Pros

  • Availability: There's likely only a few hours' difference at most between you and an onshore development team. When you need to talk, you can get in touch faster, and they're probably available if there's an after-hours emergency.
  • Vetting: Because an onshore development team is in the same country, you may be able to do more research on them beforehand.
  • Language: Again, this may or may not be a concern, depending upon the companies being considered, but it might be easier to have a consultative, strategic conversation with an onshore developer without nuances being lost in the process.

Cons

One of the major advantages of onshore teams, availability, could also be seen as a disadvantage. Some companies may prefer offshore teams because they can outsource work to them while they're asleep, so it's like having a 24/7 development team.

If you plan on going this route, you have to make sure that you're really getting the results that you need. It doesn't make you more productive to receive code that has bugs or other issues because then you have to wait until the next day for it to be fixed.

Which Projects Should You Consider Offshoring?

Offshoring can work for your business, but it works best for projects that aren't just one-off. To make sure that you're really saving money by going offshore, you need to build an ongoing relationship first. It makes sense to start off small with a test project that doesn't interface with anything else and wouldn't cause a catastrophe if it didn't work.

From this project, you can see what the offshore team's turnaround time is, how quickly they answer questions and whether they're listening to what you need. You might even choose to have the team recreate a project that's already completed just to see how good of a job they do. In this case, the only risk involved is the money that you're spending on the trial.

There are offshore teams that can produce good results, but it's not a good idea to use them for everything. Anything that's time-critical or mission-critical for your business shouldn't go offshore. If you do want to use an offshore team, you have to create a working relationship first and then filter the right type of work to them.

Offshoring works best when it's something that you don't need to be directly involved in while they're building it. On the other hand, if it's something that you need to be involved in for testing purposes, communication will be a lot more difficult because of the different time zones and the language barrier. Integrating the piece with your other systems is harder when you're awake at two different times.

Final Thoughts

Consider whether you're really saving money to go offshore. The sticker price is just the tip of the iceberg when it comes to the costs of offshoring. Things such as delays and communication difficulties are costs as well, because ultimately, it's your business that will pay the price. 

To learn more about custom software solutions, visit SYDCON's Software Solutions page to see how we use custom software to take businesses to the next level.

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