In part four of our five-part series on the different methods you can use to get your app developed we are examining what might be the most misunderstood option: hiring an offshore developer or dev team. Hiring “offshore” means working with developers who are located 100% overseas.
All things being equal, it’s hard to beat the affordability of offshore development. Their low prices are alluring. But what many entrepreneurs don’t realize is that those low prices come with trade-offs. The offshore industry is riddled with failed projects that went south because one or both parties didn’t understand what they were getting into. It can be done successfully, though. Working with an offshore team will require more of your time, energy, and focus. If you’ve got time to spare but a limited budget, that can be a win-win.
If you haven’t checked out our previous installments in this series, be sure to check out Part 1 (Hire a Friend), Part 2 (Freelancers), and Part 3 (Agencies) before you make your decision. We’re breaking down the pros and cons of each option, plus some tips to help you navigate whichever method you choose.
- Price. This is almost always the most economical option when it comes to software development. Sometimes it’s your only option. Foreign labor, particularly in less developed markets, is often cheaper due to different labor laws, a lower cost of living, or a favorable exchange rate. Developers in India, for example, often cost as little as $15 per hour. Compare that with the six-digit salaries that aren’t uncommon for U.S.-based developers, and you might be priced out of the on-shore market from the start.
- No bells or whistles. Offshore teams typically deliver only the code needed to build your website or software. More of your budget will go towards tech, instead of being spread out across project management, graphic design, and other areas. If you can take on those roles yourself, or assign them to another vendor, a dedicated offshore developer could save you money.
- Risky. Offshore teams have little connection with you or your business, and it’s easier for them to bail if your project goes south.
- Not partners. Offshore teams are not going to provide strategic advice on how best to address your target market. They will focus on building what you say, not on asking what should be built. They won’t push back on bad technical decisions or offer ideas for how to improve the interface. All those decisions are up to you.
- Single focus. Specializing in only one area of your software, instead of taking a more holistic approach to the project, means your offshore team runs the risk of building a product that works in theory but doesn’t actually do what it’s supposed to do. Maybe the code technically works but the interface is so bad no one can use it.
- Communication. Remember that offshore teams don’t know you and they don’t know your business. You can’t make any assumptions or use any kind of shorthand when communicating with them, which will often be in writing over emails that are answered in the middle of the night due to differing time zones. Your directions around deliverables and results must be very explicit. You are responsible for clear communications at every step of the process, which can be a time-intensive task.
- Intellectual property. Some countries have loose regulations around intellectual property (IP), and some less-reputable dev shops take advantage of that fact. If you haven’t properly vetted an offshore team or done your research regarding the legal protections of the country in which they’re located, you may be putting your IP at risk. There may be little to no recourse for smaller firms and individuals, depending on the jurisdiction and litigation costs.
Tips to make it work
- Cheap is not always better. The most expensive projects are the ones that don’t work out. It’s easy to be seduced by an offshore team’s low prices, but make sure that you are doing your homework before signing on the dotted line to avoid costly headaches down the line. Apps are an investment and the cost must be proportional to the return. Learn more about calculating your app’s ROI here.
- Keep it simple. If your development needs are straightforward and simple, an offshore team may be able to save you money. But as the technical specs get more complicated, or your UI/UX needs work, the more difficult it will be for that offshore team to fulfill your needs. Consider your particular needs before deciding to work with an offshore team.
- Beware bargain prices. If a quote looks too good to be true, the dev team is probably missing some critical details. You could find yourself midway through the project, with hundreds or thousands of dollars in sunk costs, only to discover that finishing the project requires triple the initial budget to be completed properly. Dig into the budget and scope up front; make sure you are not just hearing what you want to hear in terms of cost and capabilities.
- Enlist an expert. Try to bring in a trusted friend or technical resource to check for quality issues and help with communication. If you The key is to bring this person on board before there are problems. If they’re part of the process from the start, they can help you avoid some of the common pitfalls, and they’ll be more likely to catch early errors in the development work.
Stayed tuned for our fifth and final installment of this series as we explore how to get your app developed by enlisting the help of accelerators or incubators.
Got questions that we didn’t answer yet? Reach out to our team. We’d love to help!