Wait, what? Hidden Costs of Web Development Outsourcing - Coffee with CIS - Latest News & Articles

Wait, what? Hidden Costs of Web Development Outsourcing

Website development services have been gaining demand for a long time back. All this is because of the advancement of technology. People are very much busy with their daily job and after coming home every loves to go through the internet. So business owners have developed their business websites so that they can seek the attention of many users. With the process of web development, a business owner is able to increase the number of customers and can also stay ahead of their competitors. But all of these can be attained only if a proper company is hired.

Reasons for outsourcing web development

Outsourcing of web development is considered to be one of the most preferred ways for web development. But before knowing about the costs involved in outsourcing web development, it is important to know about some basic advantages of outsourcing web development. Some of the major advantages are given below-

Cost-effective

By outsourcing web development, a business can easily save a total of 20 percent in case of development cost when you are working with the team of developers remotely when compared to the process of hiring developers in-house. It can be said that nearshoring or offshoring, any type of outsourcing is very much effective. The main reason for this is because of the labor cost which varies from one country to another. There are many polished development firms who is having the ability to offer affordable prices because of the low labor costs in the EU. However, when a person is involved in hiring an in-house developer, they must keep acquisition and retaining costs in mind. In-house developers can have a tendency of quitting the job and so the whole process has to be started again. When a software house is hired then the client must provide the cutting edge along with resources in order to get the digital product as per the needs of the client.

Savings are not only about the cost with the labor but also with the cost of the developer which can be very high above the expectations. Not only the monthly salary of the software developer, but also the expense related to the process of recruitment, hardware that is needed by the developer for performing his job, and many more. There are many companies that may prefer to hire a freelance developer for web development but this can never match with the outcome of outsourcing web development. This is because when a person is outsourcing web development, then the client will be provided by a team of developers who will be dedicated to the given project.

Focusing on business

The main job of outsourcing web development is to bring the project of the client to life. Outsourcing will help the business owners to stay rest assured and do what they need to do which is the way of running the startup or focusing on the processes of the core business. The major advantage is that the client will never have to spend time worrying about the outcome of their project. However, hiring a proper outsourcing partner is also essential that will be having previous experiences. The remote corporation can play an important role in bringing many benefits if the plan is made in a wise manner. All the work for web development will be done by the outsourcing partner and the client is free to do whatever they want or whatever they feel necessary.

Experts in their field

The process of outsourcing will help in reducing the cost but that does not mean that you will be receiving low-quality coding. It is always important to keep in mind that a person must never compromise with quality. According to various researches, it can be said that Europe is ranking high in the world of developers. A talented team of developers will always perform better and produce better results when compared to a freelance developer. IT outsourcing is so good that there is no need of worrying about the knowledge of the team of developers as the knowledge of the team of developers has already been checked by the outsourcing company itself before giving them their employment. If you are hiring a good website development company, then they must be having experience of years and they will always have the best idea that will help their client in boosting their business.

Personal development of developers

If there is a comparison about knowledge between in-house developers and a team of developers provided by an outsourcing company then the latter will always win. When hiring their own team of developers, proper care must be taken for their growth in knowledge. In software house, the developers are always up-to-date and the team learn many new technologies

Days off

When a person is responsible for hiring in-house developers for developing their project, then there are chances that the developer might get sick and there is a delay in the release of the project. But when a person is outsourcing software development then there is no chance of delay as the software house is responsible for providing the team of developers and if a developer is sick then the software house can provide their client with any other developer. But if a proper outsourcing company is not hired then all the advantages that have been mentioned can turn to be disadvantaged.

Responsibility

Higher liability is faced by software companies when compared to in-house developers. If the agreement of the outsourcing company is not followed properly then the company will have to face consequences. So if a situation arises where a mistake has been done then the software house will take the proper step to fix the things.

Dealing with B2B contracts

It is very easy to deal with the agreements or contracts of any software house rather than in-house developers. If the services of the outsourcing company are not liked by the client then they can easily break the agreement without any involvement of the labor law. A best web development company will always satisfy their client with their services.

Tips for choosing the best outsourcing web development agency

Entrepreneurs are choosing the process of outsourcing web development and these are becoming popular day by day. Outsourcing can help in reducing the cost and also help the clients in giving access to the best developers of the world. Moreover, this will also help in bringing the product to the market in a quick manner. However, as mentioned earlier all of these advantages can be received only if a good software design company is hired. Hiring a company is easy but hiring a good one may be difficult. Some of the tips to hire a good outsourcing company for web development are given below-

Reviewing reputations

Reputations are an important factor when a person is involved in choosing a company. Everybody likes to maintain their reputation but if the job is not done properly by them then their reputation can get hampered easily. It is very essential to review a company’s reputation after setting sights on those companies. Companies will never show their failures in their websites and so the information from a single source that is the website is never enough to choose them for your project.

It is important for a person to dig into bigger platforms like GoodFirms, Upwork, and Clutch. These platforms basically will help you in talking to the clients who have already experienced the service of a company which you might be targeting. It will also help in gathering the important details regarding the companies. It is always essential to go through corporate blogs, social resources, and news. Now depending on personal communication, a person will be able to make a decision whether to choose that company for developing their project or to reject them.

Experience

It is very important to check the experience of the companies which you are choosing for your project. It is very important to choose that company who have gained success in dealing with a project similar to the one which you want to get. Now if a company is having proper experience then it can overcome any difficulties while the process of development. For example, if a person wants to develop any medical app for their business then they must choose a company which has already completed making similar kind of apps.

Avoiding miscommunication

Miscommunication is something that is very harmful to any business. Miscommunication will always lead a person to fail. A productive partnership can only be successful if it is being built on proper understanding. It is very essential for a person to feel comfortable when they are involved in performing all negotiation stages. It is very important to keep some important points in mind and they are-

  • Whether there are any discomforts that can take place because of cultural or language barriers.
  • Whether all the requests of the client is explained properly and is realized properly
  • Whether the partners of the third-party will be able to adjust time zones according to the comfort zone of the client.
  • Amount of time a person must wait for feedback.

So the effectiveness of collaboration will only increase if both sides are engaged in perfect communication.

Trust can be built by signing a contract

Today’s world is full of fraud people. But when you are choosing a company by seeing their works, then they must be a genuine one. But still, it is always essential to sign a contract. If an outsourcing web development company is trustworthy then they will always suggest signing a contract with the client. a contract is responsible for covering-

  • Terms and conditions of development of the website.
  • The preliminary budget is necessary for the development of software.
  • Warranties must be mentioned in the earlier stage and must be checked properly without signing the contract.
  • The rights, as well as responsibilities, must be looked at carefully by both the participants.
  • Main definitions related to the process of development.

NDA is very important in case of terms and agreement. NDA stands for Non-Disclosure Agreement and the security measures must be agreed upon in an NDA. This is basically a document that will ensure that the confidential information of the client’s company is not shared with any other person or company.

Guide for outsourcing web development

There are three main steps which must be followed in order to find the best outsourcing company that will help in producing the perfect product as per the requirement of the client. the steps are given below-

Clarifying the business goals and requirements

If the business goals and requirements are clarified then it will help in-

  • Thinking of what you wish to achieve by making a web project for your company.
  • Helps in defining who all are your users and what they will be receiving from you by using the website which you are developing by seeking the help of an outsourcing website development company.
  • Adding the requirements to the website which has been built.
  • It will also help in pointing out the desired terms of the implementation of a web app for the development team which you are having.

Choosing a perfect web development company

If a perfect and trustworthy company is chosen by you when deciding on the patterns of web development is possible along with the platform ratings. It is essential to choose the first 10 to 15 outsourcing web development companies that will be-

  • Fitting all the requirements that you are having.
  • Having experts with the niche which you are having.
  • Having proper and suitable locations
  • Setting affordable or reasonable prices.
  • Present in the market from early days.
  • Having rich positive reviews from satisfied clients.

It is important to look through the awards of the company, information on blogs along with posts of news companies. This process of selection can be easily entrusted to a selection process like Upwork. Then it is essential to establish direct contact with the companies.

Controlling the process of web development remotely

After completing the process of collaboration, it is very important to keep in touch with the project manager and monitor the process of web development. It is very important to discuss-

  • A proper as well as the comfortable schedule for establishing remote
  • Deadlines to check the intermediate results.
  • The preliminary design of your app or website.
  • A budget for the development of the website and strategic items.

All of these should be done depending on the agreement that has been signed by you with the outsourcing web development company which you have hired. Developing the project in the best way is only possible when you have hired a successful outsourcing company within your budget.

Normal costs involved in outsourcing web development

If a person is planning to outsource web development it becomes very difficult for any person to estimate the cost in an accurate manner. Calculating the prices is very difficult as there are many factors that are influencing the cost of outsourcing software development. SaaS application development can also be effective sometimes. However, some of the main factors influencing the cost of outsourcing software development are given below-

  • The scale of the web product which a person is planning to develop
  • The complexity of the process of web development
  • Total number of the specialist who is involved in developing your project
  • The time that is required for developing the project
  • Hourly rate of developers which may vary from one country to another

Hourly rates are something that will always vary from one country to another in case of outsourcing a web development project. The hourly rates of outsourcing software development in three popular regions are given below-

  • In the case of North America, the hourly rates are between $100 to $150
  • In the case of Eastern Europe, the hourly rates are between $25 to $70
  • In the case of Asia, the hourly rates are between $20 to $40

Previously people were of the opinion that the highly skilled d3veloeprs were available in the US only but now the time has changed and developers with great skills are starting to emerge from Asia as well as Eastern Europe. However, these regions are responsible for offering IT engineers at 30 percent of the cost when compared to the cost involved in the hourly rate of developers charging in North America. But people can still doubt the skills because of the difference in the hourly rates among the developers. According to certain researches, it has been found that developers from Asia and Europe do not offer low-quality projects. They are able to meet the expectations of their client. Responsive web design services are also getting on high demand as it is able to produce a good effect on the mind of users.

There are many entrepreneurs who will be choosing the outsourcing of web development from these regions. One of the most logical things to do is to find out the cost of outsourcing web development depending on the examples. If an average of$35 is taken as an hourly rate then the cost involved in various developing web projects for various businesses are-

  • A custom website of real-estate will cost between $45,000 and $66,150 depending on the nature of the complexity of the app.
  • If an online platform for learning is created then it can cost around $62,000
  • When a website is created for price comparison then also the cost is not less and can cost around $43,000
  • People are now engaged in building medical websites and so in order to build trendy as well as modern websites then the outsourcing the website development can cost between $35,000 to $65,000
  • Ecommerce has recently emerged just after the occurrence of a pandemic. People are using e-commerce websites and so in order to develop this kind of eCommerce websites the cost can be between$15,000 to $40,000

Read the blog- How much does web application development cost?

Dealing with the hidden cost of outsourced software development

In general, there are two types of outsourcing models that are present in the market and they are-

  • Process level outsourcing and resource level outsourcing

Hidden costs of resource level outsourcing

The resource level outsourcing may be seeking the attention of many people as it is having a low price but it is important to keep in mind that it is having many hidden costs which result in the lack of experts inside the team. The reasons for hidden costs in the case of process-level outsourcing are given below-

Performance of outsourced team is low

The low performance is basically characterized by gaps in communication, scope creep, remote project management, and growing technical debt. This can be proved to be ineffective on your side.

Too many requests for change

It is very natural to have changes in agile but when the changes are in great number then the understanding between the outsourced team and client is never mutual.

Quality of software being low

Proactive testing activities are excluded from resource-level outsourcing so that they can appear to be cheaper. But bug fixing can play an immensely important role to disrupt the whole project later.

Architecture is weak

A team of developers is having the ability to make architectural choices that are unthoughtful and is able to do massive rework further in the lifecycle of software development.

Dealing with hidden costs of process-level outsourcing

Process-level outsourcing can also have some hidden costs if it is not organized in an effective manner.

Verifying competency of vendor

Some companies are able to put a gloss present in the offer but they are unable to meet the expectations after the starting of real work.

Transition to another outsourcing provider

This can take place sometimes and it can be costly at times.



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Conclusion

In the above segments, the advantages have been mentioned about outsourcing software development, along with the costs involved. Moreover, the hidden costs that can come into existence are also mentioned and this will help you in setting your budget.