It is a challenge to build and maintain an in-house development team, especially when web and mobile applications are not at the core of your business model. Many executives, instead, have opted to outsource their work to development companies — both here (onshore) and abroad (offshore).

When your company starts to have these internal conversations, one of the first things to be decided is this: do we outsource to offshore or onshore development teams?

Forming a partnership with an offshore software development service can be a viable option. Popular countries for development teams include Brazil, Russia, China, and India. While some of these counties may be considered a part of the third-world, they have a large, young population that is educated and rank high on the English Proficiency Index.

You need to reduce staff costs.

If you decide to go with an offshore team, making more room in the budget is an obvious real motivation. The costs associated with an offshore team are anywhere between 1/3rd to 1/2 the price of onshore rates. We have seen that a rate $50 per hour for a good offshore developer compared to a rate $100 per hour is a good estimate.

You also have to understand the coloration between cost and quality of service. When you plan on outsourcing your work, don’t look for the cheapest hourly rate. It may end up costing you more in the long run. The probability of loosing your time and money is relatively high. As a result, when you are looking to hire an offshore team, always go with the best.

You can work with different a timezone.

One of the major challenges working with a team outside of the United States is dealing with timezones. If you are using an offshore team in India or another Southeast Asian country, which is 12 hours ahead, you will never be working at the same time. This presents a break in the communication cycle. Real-time communication is rarely possible. As a result, you will have to wait a day for answers to questions, and if the answer requires follow-up, that’s a whole another day.

If you can work with a team within your same time-zone, this challenge can be mediated. Countries in Latin or South America are located in many of the same time zones, and will create a more efficient communication cycle.

You need initial proof of concept at a reduced costs.

Another benefit of going with an offshore team is being able to create an initial proof of concept with a lower investment. Working with an offshore team allows you to create a minimal viable product at a reduced rate. In turn, you would be able to test to see if your solution is viable.

Once you have the ability to prove a product could work, you can leverage the concept to get more investment. With a larger pool of resources, you can then use an onshore team that’s more reliable and experienced to create a high-quality product.