Are you wondering if outsourcing will be worth it for your business? There are so many offshore software development benefits and if you read this article, this could be a training point for your business. You will understand the key advantages of outsourcing, you will know how, when, and where to find the best people to hire. The first four benefits all deal with money.
Benefit 1 - Low Labor Costs
Number one is that it’s so amazingly affordable to hire somebody overseas. People from other countries can ask lower pay for their work than your in-house employees. These people are typically highly-educated, they speak English perfectly. The challenge for them is that it could be really difficult to find good work in their own country. We commonly hear about the job that offers high pay but asks these people to leave their families for months. Image, how thankful these people would be having a job with higher pay without leaving their native country and families.
Benefit 2, 3, 4 - Low Overhead, Competitive Pricing, Increased Profits
Having offshore staff that works from their home or office means low overhead for you. Unnecessary overhead just means how you have to charge your customers. If you reduce your costs like this and you eliminate most of your overhead, you will either have untouchably competitive pricing or huge profit margins or a mixture of both. You can charge less than your competitors and have higher profit.
Benefit 5 - Task-Specific Staff
Another benefit is a task-specific staff. Let’s imagine, instead of outsourcing, you hire someone in the United States and pay them around 40,000 dollars per month. Let’s say that this person is extremely valuable for you. He does great work and is very effective. Now let’s contrast with paying the same 40,000 dollars per month to hire ten full staff people from overseas. These ten people will each be exponentially more valuable to you individually and collectively. They will be more valuable individually because they each take one of these ten areas and perfect it. That person has now eight hours per day to do what your one person had one hour to do. That specific task will be completed to levels you never dreamt of. These ten will be more valuable to you collectively because of eighty hours in a day it is obviously more valuable than eight hours a day.
Benefit 6 - Increased Efficiency
As you can imagine, running a business like this results in an increased efficiency. When you running efficient, your profits are high. The company morale is great, people love their jobs, and no one is worried about being late off.
Benefit 7 - Time to Grow
Another huge advantage to outsourcing is that it frees you up as an entrepreneur to grow your business instead of just running it. You are able to work on your business while your staff works in it. Take a moment to process that one.
Benefit 8 - Time Zone Benefit
The next advantage to offshore software development is the time zone benefit. At the end of your day, you are able to assign all sort of tasks to your offshore team and begin work the next morning when everything is done. Your business will grow while you sleep.
Benefit 9 - Not Training Your Competition
When you hire someone overseas, you are not training your competition. If you hire someone in your native country, they may become your competitors in the future. That’s not a case with overseas developers and one of the most important offshore software development benefits. These people are extremely loyal and they have no interest in having your business. They just want to get a stable job and they love working for Americans.
Benefit 10 - Help Third World Country
Usually, customers find their vendors in the third world countries. The more you can outsource to these countries the more you can help these countries, their economy, and their standard of living. It’s just the right thing to do.
Benefit 11 - USA Standard of Living
What about the USA? You’ve probably heard that you need to keep jobs in America or buy American-made products. The truth of it is: the more you outsource, the higher your standard of living becomes. Sending a job to another country doesn’t reduce the number of jobs, it changes the types of jobs because you spend less money on a bookkeeping, programming, graphic design, phone support, marketing, and many more things. You have a lot more money to spend on entertainment, dining, traveling, and so on. The more you outsource, the more jobs start appearing in other areas and the better your standard of living becomes.
How Offshore Development Teams Work
To grow your business you need people and one of the biggest challenges that you are probably facing is how to find and retain the best possible people at the best possible price. You may be tried using the staff like consulting agencies, freelancers, or headhunters but these solutions are expensive and time-consuming. Wouldn’t you rather focus on growing your business instead of worrying about it?
With offshore software development teams, you can select and hire new employees overseas. This staff is usually legally employed by an outsourcing company. These people will be working for you full time. Offshore staffing is surprisingly easy. Here are some steps to hire the best people:
- Discuss your talent requirements
- Draft the job descriptions for people you want to hire
- A recruitment team of an outsourcing company will match those requirements with their people from the database.
- Recruiters will carefully screen the candidates and make sure that they are a good match for your requirements.
- You can also screen the candidates as you would screen your own job applicants (interviews by web camera, telephone, skills tests, and any other steps you feel are necessary to make the right decision).
- Once you have identified the people you want to hire, the company will set up the office, workstations, telecommunications, and any other tools your new team members may need.
- You may be also provided with your own account manager who will supervise your people. Here are some other support roles you can be provided with:
- Technical support
- Operations management
- Best practices and compliance
- Human resources management
- Employee engagement
- Coaching and training
- Security and facilities management
- Accounting and payroll
- Support services
The salary of your overseas employees is likely to be 70% lower than what you used to. You will also have indirect cost savings because an outsourcing company will be in charge of managing and supporting your new employees. So, there will be no need to expand your office, buy more computers, or hire more support personnel. You can truly focus on growing your business.
Usually, overseas vendors don’t share their employees or give them multiple assignments. All the people will really be your people and outsource providers won’t reassign them to a different client. The pricing is transparent. This means that you will know exactly how much a vendor is paying for your employees and how that breaks down into salary, taxes, insurances, and benefits. These vendors don’t charge any recruitment fees or any other types of fees.
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