To fulfill the different requirements of software development, businesses go for offshore development services. In this order, the first thing they consider is the cost of offshore software development. But do you know developers in different countries charge different rates? The below article will cover different offshore software development rates by country, cost-affecting factors, evaluation of offshoring costs, and how to select the right offshore development firm.
An Overview
Offshore software development services are expanding rapidly, and businesses are also leveraging this approach to get benefits such as lower development costs, no hassle, faster processes, and others. However, businesses need to do in-depth research about the hourly rate for software developers according to their country. Having a proper evaluation of the varied offshore software development rates will help them save a huge cost amount of software development.
Seeing the increasing demand for offshoring services to access a wide range of skill sets and decrease overall costs, enterprises are also embracing it broadly to remain competitive. But now the question arises, how much does it cost to obtain offshore software development services, and how much software engineer hourly rate differ based on country? This cost variation comes from different aspects such as labor markets, economic conditions, technical expertise, number of hired experts, project scope, and many more.
Continuing, this below write-up will provide you with information about offshore software development rates by country and region, factors having an impact on offshore development rates, along the right strategy to select an offshore software development agency. Let’s dive into the details:
Offshore Software Development Rates by Different Countries Worldwide
Around the world, there is a broad range of IT service providers that have different costs for different software development services by considering project scope, needed resources, timeline, extended technological proficiency, and others. Alongside, labor cost and cost of living are also two prime factors to consider that affect the offshore software developer hourly rates.
Some countries are providing premium-quality software development services at a fine rate. Right now, Western Europe, North America, etc. are the preferred regions to outsource the projects. Top-rated firms in these countries hire software developers with high expertise & experience and then provide offshore development services to other countries.
Let’s check out the different prices charged by software developers in different countries and regions:
Offshore Software Development Rates – Asia
Asia is a popular region for businesses to obtain outsourcing services. Yes, you heard it right! This largest continent is leveraging modern-edge technologies to deliver business-centric and profitable solutions worldwide. The less time difference between Asia and other Western regions is the reason why it is becoming a top choice for offshoring services. Asian countries such as India, Vietnam, Singapore, Japan, etc. offer a perfect blend of skilled resources and high-cost efficiency that distinguish them from other countries.
Be it any software platform, language, technology, or any other platform, these countries have a well-versed team of dedicated experts with lower offshore software developer hourly rates. Due to Asia’s thriving economy, there are various lucrative business opportunities for ventures to improve their market scope. It will be most beneficial for small-scale businesses and startups to begin with lower development costs such as $20.
Below, we have provided different offshore software development rates that will help you to hire resources accordingly.
Southeast Asia (Vietnam, Phillippines, Malaysia, Singapore, Indonesia, Thailand) – $20 to $50 per hour
South Asia (India, Bangladesh, Sri Lanka) – $20 to $40 per hour
East Asia- (Japan, South Korea) – $30 to $80 per hour
Offshore Software Development Rates – Europe
Europe is the prime IT outsourcing destination including Eastern, Western, Southern, and Northern Europe. Among all of these, Eastern Europe is much more affordable in comparison to Western Europe as Eastern Europe provides highly competitive offshore development rates due to a lower cost of living and Western Europe has a higher cost of living leading to increased development costs.
In the CEE (Central and Eastern Europe) region, the IT sector is growing rapidly consisting of various offshore software development companies. Some small companies might charge you less but then, they won’t offer you competent and full-cycle development. Thus, you must go for a reliable software development partner despite their higher offshore software development rates.
Whereas, the Western European countries are full of capable professionals equipped with the knowledge of newest technologies and industry trends but enterprises need to have a high budget to acquire their services.
Comprising all the European countries, we have penned down different offshore software developer hourly rates below:
Eastern (Estonia, Poland, Romania, Czech Republic, Ukraine, Hungary) – $40 to $100 per hour
Western (United Kingdom, Netherlands, Austria, Belgium, Germany, Switzerland, & Belgium) – $100 to $200 per hour
Southern (Spain, Portugal, Turkey) – $40 to $80 per hour Northern (Norway, Sweden) – $50 to $120 per hour
Offshore Software Development Rates – America
While talking about offshore software developer hourly rates in America, we can see the obvious rate variations in North and South America. North America is much costlier than South America consisting of countries like the USA and Canada. North America is renowned as the leading IT giant worldwide, whereas, South America still has a growing IT field leading to lower development charges.
You can hire offshore developers from North or South America as per your project budget. Additionally, offshore developers in America are continuously augmenting their technical understanding and IT infrastructures to boost industry growth; hence, there is no doubt of getting high-quality development services.
Below you can have an idea about software developer rates in both North and South America:
North America (Canada, USA) – $150 to $250 per hour
South or Latin America (Brazil, Mexico, Argentina) – $50 to $80 per hour
Offshore Software Development Rates –
Australia & New Zealand
At present, the Australian IT market seems very promising regarding IT outsourcing services as it is expanding rapidly. It competes with well-known industries such as the USA, Asia, Canada, Europe, etc. in terms of development rates and technical proficiency. But what do you think is why they are not able to keep up with the other regions?
The main reason behind that is the significant time difference between Australia and other European countries. Also, Asian countries like India, Vietnam, etc. are providing better services to businesses with other advantages such as similar time zones, talented resources, etc. at a lower development rate.
The advantages provided by countries like Australia and New Zealand consist of capable tech talent, good communication, market expansion, and customer satisfaction. If you have to hire offshore developers from Australia or New Zealand, the hourly rate for software developers starts from $80 to $150 per hour.
Offshore Software Development Rates – Africa
Due to the poor economy of Africa, it is never a preferred destination for businesses to acquire offshore software development services. Though it has lower development rates, it is still counted among emerging markets only. African countries are trying to approach overseas clients from Europe due to the advantage of sharing similar time zones.
Countries in Africa such as South Africa, Morocco, Egypt, Tunisia, and others have capable tech resources specialized in programming languages such as Ruby, Python, C++, PHP, and others. In Europe, these African countries have emerged as the most popular outsourcing destinations because of the language efficiency in English and French.
Here is an estimation of offshore software development rates in Africa:
Africa (Egypt, Kenya, Morocco, Tunisia, Nigeria, South Africa) – $20 to $50 per hour
Why You Should Go for Offshore Software Development Services?
Obtaining outsourcing services or hiring offshore software development services is the best way for cost-efficient development. From startups to small businesses to large-scale enterprises, all are getting great advantages from IT outsourcing services from developing countries comprising tech proficiency.
Here is a curated list of more reasons why enterprises should choose offshore IT resources:
- There is a global pool of talented and adept software developers businesses can access to outsource their projects. They can choose specific and affordable resources they require.
- Offshoring or outsourcing is known as the most significant cost-saving approach. Along with the actual software development cost, there is always a hidden cost allied with in-house experts such as infrastructure, training, resources, software license purchase, etc. That’s why businesses should go offshoring with reasonable hourly offshore software developer rates.
- Outsourcing your project to a country with a different time zone will enable a continuous development procedure, speeding up the overall process and facilitating faster market time.
- Offshoring enables businesses to hire in-house developers only occasionally, saving a huge cost and time in the hiring process; otherwise, it will go to waste because they do not always have their requirements. They can easily outsource the service whenever needed by only paying experts for their working hours. In short, outsourcing helps businesses be flexible.
- Sometimes, your in-house developers may not be updated or enabled to keep up with the latest trends. In this case, you need to hire offshore software developers to scale up your operations and fulfill clients’ demands.
Bonus Read: Onshore vs Offshore Software Development
Factors Affecting the Offshore Software Development Rates
Evaluating offshore software development rates by country involves a wide range of factors such as location, experience, time zone, tech skills, etc. You need to assess these factors influencing the hourly rate for software developers before choosing any tech partner or estimating the outsourcing cost. The following are those factors-
Location of the Firm
Offshore software development rates largely depend on the location of your chosen firm or developers. Different countries charge different development costs due to the variations in their living standards affecting the overall costs. The higher the cost of living, the more costly resources are. If you are thinking of hiring offshore developers from developed countries like the USA, Switzerland, Canada, etc. you must pay higher development costs. But if you are outsourcing to Vietnam, India, etc. you can have a highly cost-effective development process.
Experience of the Company
Experience of the offshore software Development Company or offshore developers includes their portfolio, previous projects & clients, market reputation, ratings & reviews. You need to research about them in detail before hiring them. Companies or experts with strong market reputations and rich experience may have higher offshore software development rates than firms with less experience and expertise.
Technical Proficiency
You need to hire offshore developers with high proficiency in specific technologies and tools depending on the niche and expectations related to your project. It may make your project complex, automatically increasing the overall development cost compared to a simple project with general requirements. If you are expecting your offshore resources to analyze the preferences and embrace modern-edge technologies, it will cost you more for sure.
Skill Set of Developers
Hiring offshore software developers with rich knowledge and experience in the newest technologies and tools can be a major factor affecting your overall cost. Experienced firms or developers in the USA will be more expensive than other inexperienced countries. Certainly, the cost goes up with the passing years and increased seniority level of highly skilled specialists in DevOps, and other software architects. Provided services along with creativity and consultancy make their experience more appreciated and increase software engineer hourly rate.
Different Taxes
Every country has its own tax policies for the IT industry that can highly affect the offshore software developer’s hourly rates. For instance, India has an 18% GST rate on software development, Poland has 23% VAT but for small businesses, it is 5%, and the Philippines has 12% VAT. Ukraine and Vietnam-based IT firms apply no tax on software development services, whereas, USA-based companies may apply taxes up to 35%. Based on these tax rates, offshore software development rates can also differ.
Read More – Top Countries to Hire Remote Developers
How to Evaluate the Offshore Software Development Rate?
Evaluation of offshore software development rates comprises various aspects such as project size, considered platform, time-to-market, and many others. Also, you need to ask yourself, will it be more beneficial compared to in-house development?
Below we have highlighted some of the key points contributing to the offshore software development rate evaluation:
Chosen Platform
It is the topmost considerable factor while gauging offshore software development rates. You must decide to choose an appropriate platform between Android, iOS, or both. If you are selecting one platform only, then you have to pay a lower fee compared to choosing both platforms. To get an exact estimation, make the decision accordingly.
Time-to-market
Developing your product early or providing it more time will greatly affect your software development cost. Your given time to complete a project will also have a huge impact on its R&D, and overall development process. The more time-to-market will be, the more you have to pay. It will be good to hire a large team of developers to get things done quickly and proficiently.
Size of the Project
Project size is the prime factor in deciding the offshore software development rates. If your project consists of various features and functions, it will have a higher development cost. But if you are going for a simple project with core features only, it won’t affect the overall cost. In the case of a large-scale project, you must require an extended development team that will increase the overall price.
Team Size
The requirement of a larger team will have a great influence on the offshore software development cost. There will be more efforts and manpower that will increase the rates accordingly. Hiring a firm won’t affect the cost at all but if you are going to hire remote developers, then you must consider the size of the team.
Read More – Outsourcing Vs Outstaffing: What is the Difference
Right Approach to Select an Offshore Development Country
Choosing an offshore development country with skilled experts is the best way to complete your software development project in a cost-efficient way. But you need to put up the right approach when selecting an offshore development country. Here are the key points to follow:
Labor Costs
Labor cost is such a factor that varies depending on the location. In developed countries like the USA, there are higher labor costs but in developing countries like India, lower labor costs are leading to variations in offshore software developer hourly rates. You need to analyze and choose the right country with skilled resources but less labor costs.
Availability of Proficiency & Skills
Before choosing any country, analyze the scope of specific skills and expertise you want for your project. Also, consider the latest technologies and other business requirements to check which country you should go to. Some countries are popular for providing some specific services, for instance, India is known for full-cycle software development, web development, and data analysis, Romania is famous for software development, computer security, and computer system architecture, whereas Vietnam is the best when it comes to software and web development, and so on.
Political and Economic Stability
Before considering any country as your offshore software development partner, it must be stable politically and economically. Otherwise, you will be worried about the project’s completion and security throughout the process. It also alleviates other risks such as strikes, and fluctuating regulatory environment, upholds transparency, and facilitates you to meet the industry standards.
Data Security
A country with a stable political and legal environment ensures businesses with the utmost security and protection of their confidential data and sensitive information. As an enterprise, you must pick an offshore destination with rigorous security laws and strict privacy policies to guarantee ventures about high data protection.
Long-term Partnership
When finding a suitable country for outsourcing IT services, you must ask yourself, is it for the long-term or short-term? If you are seeing it for long-term business continuity, choose a country securing a good place politically, economically, legally, and socially. It will enable you to plan your future projects with them while maintaining a long-term partnership. Considering all these points, remember to keep an eye on the offshore software developer’s hourly rate.
How Will Understanding Different Offshore Software Development Rates Help You in Business Growth?
If you are running a startup, you must know how budget is a big constraint in your business growth. On the way to establishing your firm, you need to plan every single thing according to your budget, such as infrastructure, software & hardware, hiring process, resources, payrolls, etc. In this case, outsourcing your development services will be a more beneficial option for businesses. But even in outsourcing, budget limitation is a significant factor to consider.
Here, understanding different offshore software development rates by country will help you in informed decision-making leading to cost optimization. You must analyze and compare development rates across different countries and regions so that you can hire the best ones with lower development rates without compromising on quality.
Knowing the general offshore software development rates will enable firms to hire resources accordingly in an efficient way, negotiate prices, and choose the finest outsourcing destination. Also, a clear understanding of offshoring rates will make businesses realize the importance of creating a realistic budget, alleviating extra expenses while preventing startling costs, and renewing the overall financial planning. Eventually, this strategic tactic will foster not only cost-efficiency but also, boost the overall business growth comprising successful projects, streamlined operations, and high competitive advantage worldwide.
Why Developerperhour is an Ideal Choice for Offshore Software Development Company?
After reading the above article, if you are also planning to hire an offshore software development company, you can contact Developerperhour. Being an experienced firm in the industry for more than 17 years’ experience, we have worked with a wide array of businesses, be it a startup, SMEs, or large-scale businesses.
We are a leading IT outsourcing agency providing outsourcing services across industries ranging from Fintech, entertainment, healthcare, food & grocery, retail & e-commerce, and education. We have highly flexible hiring models to enable businesses to go for the one as per their preferences and budget.
Be it full-cycle software development services, or just a unique project idea, we are here to assist you with skilled and talented resources specialized in cutting-edge technologies. Contact us and create your adept team of proficient developers at competitive offshore software development rates.
Conclusion
We hope you have a good understanding of the different offshore software development rates by country. Hiring a capable software development team or a top-performing offshore software development company is not an easy task when outsourcing your project. It requires a lot of research and evaluation of varied aspects such as expertise, market reputation, political & economic stability, and others if you find tech proficient in regions like CEE, America, etc.
Before researching hourly rates for software developers, you must pick the right country to hire remote developers with the required technical proficiency and skills. Also, assess your own strategy after hiring remote developers, how you will plan your work while coping with a different time zone, etc. Ultimately, it will depend upon your project requirements and the choices you made throughout. Hence, you must conduct proper research and analysis before hiring any offshore development team or company to match your expectations.
