Top 8 Benefits of Nearshore Development

Outsourcing has proved to be a successful model for businesses that want to save on expenses and labor overheads while enhancing efficiency. You can scale this model while still enjoying the possibility to regulate your resource allocation as needed.

There are three main kinds of outsourcing:

·      Offshoring – your outsourcing partner is far away, maybe in another continent.

·      Nearshoring – your outsourcing partner is geographically closer.

·      Onshoring – you transfer a business operation that was moved overseas back to its country of origin.

Nearshoring allows companies to transfer their operations to a nearby, more economical location. This proximity results in fewer time and cultural differences and a higher level of control in decision-making practices. Several American corporations choose to nearshore operations to Canada, Mexico, and other Latin American countries.

In this post, we’ll take a look at what nearshoring exactly is and how it can help businesses streamline their software development processes.

Advantages of Nearshoring Your Software Development

The world of business is experiencing changes at a fast speed and new challenges appear every second. It’s tricky for companies to keep pace with these rapid changes. That’s why nearshoring looks like a natural choice. It has particularly gained popularity in the age of COVID-19 as remote opportunities have become the new normal.

Nearshoring is just the right option for those businesses that don’t want to lose their competitive advantage. It is one of the most common practices when it comes to complex and laborious tasks such as software development.

Here are a few advantages of nearshoring your software development:

1.   Cost Reduction

Nearshoring allows you to considerably reduce costs, saving money for more business-critical tasks. When working with remote resources, your company can cut down on on-premise overheads as you no longer have to support brick-and-mortar costs.

Based on the country you’re contracting your developers from, there can be substantial differences between charges. For instance, a Latin American developer earns an average yearly salary of around $24,100. At the same time, a US-based software developer would earn an average yearly salary of around $76,526. Clearly, it’s best for the US companies to nearshore their development to Latin America.

2.   Better Access & Control

When you offshore your development, the subcontracted team is located far away and you have limited access to them. Contrarily, when you nearshore, you’re geographically closer to the team, perhaps just a short flight away. This makes it a lot easier for you to keep things under control.

You can visit your subcontracted team from time to time due to their proximity to your workplace. As a result, you can closely monitor the software development process.

3.   Extended Talent Pool

Let’s face it: Not all countries have great specialists, especially in the tech industry. So nearshoring could easily fix that problem.

When you nearshore your development, you broaden your pool of talent by finding a more capable workforce for your projects.

For instance, Latin America has succeeded to make its mark in the IT field. It has become the most popular destination when it comes to nearshore software development. Many US businesses have entrusted top developers from Latin America with their projects instead of in-house teams.

4.   No Cultural & Time Differences, Better Communication

Cultural and language dissimilarities can create substantial obstacles that are hard to overcome. It can result in problems with communication, delays, legal dilemmas, and so on. That’s why an increasing number of businesses are exploring nearshoring as an easier way to outsource.

As the nearshore destination is close to your geographical region, there are often very few cultural differences. Moreover, nearshoring provides the benefit of same language and time zones to your teams. As a result, it is easier for you to collaborate with outsourced specialists.

Eventually, communication is also streamlined, which is a significant part of doing any kind of business. Unlike offshoring, nearshoring brings more clarity to the communication process between you and the subcontracted team.

5.   Improved Productivity

Nearshoring also helps improve your team productivity. For instance, you can hire a team of subcontracted experts to manage your back-end development so you can exclusively concentrate on more critical tasks.

Also, your employees can easily get burned out if they’re frequently working overnight. Nearshoring allows you to perhaps exclude night shifts altogether, enhancing both the quality of work and worker retention.

6.   Expedient Integration

When nearshoring your operations to a country where people have similar culture or language, you don’t have to wait for weeks before your subcontracted team integrates with your business processes. They can deliver you the best of their performance quickly.

However, it’s significant that your nearshore partner has the same kind of technical know-how as your internal team. This will make the alliance more useful.

7.   Similar Legalities

When it comes to software development, intellectual property (IP) laws are critical. As your outsourcing team is located nearby, they’re more likely to know about your country’s laws. As a result, you won’t land into any legal predicaments that could delay your project’s launch.

If you want to protect your company’s IP rights while outsourcing, nearshoring is the most suitable option as it allows high control over the way these rights are being secured.

8.   Better Return on Investment (ROI)

ROI is what encourages businesses to outsource their development in the first place. Although offshoring is initially less expensive, you might have to bear some extra expenses due to the difficulties that occur along the way. For example, you might face management issues, underperformance, lack of control, poor communication, and so on.

On the other hand, nearshoring might seem expensive in the beginning, but it offers better outcomes and saves money in the long run.

Wrap Up

Software development outsourcing helps companies attain greater economies of scale and, most significantly, greater specialization. It allows companies to concentrate on their core competencies.

Nearshoring is quickly becoming a popular kind of outsourcing and that’s because it offers great perspectives and opportunities for software development businesses. You can enjoy convenient access, better control over the entire process, lack of language and cultural barriers, and many other advantages if you choose nearshoring as your key outsourcing alternative.

However, you can only reap all these benefits if you find a reliable contractor that better understands your project’s needs. At Sonatafy Technology, we are a leading Software, QA, and Maintenance Engineering company focusing on boosting your teams with competent, experienced, and refined talent located in Latin America.

Contrary to the common misconception that resources in Mexico are cheap and unskilled labor, many major universities throughout Mexico have impressive computer science programs. All of our engineers and developers have a valid computer science college degree and real working experience. You can be assured that a Sonatafy engineer has the same education or better than an American engineer (many of which don’t have CS degrees or simply went to a coding boot camp).

We specialize in developing solutions for a wide range of industries as we understand software compliance, scalability, IP security, and creating longstanding relationships. Get in touch with us today to learn more about our services.