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7 Reasons to Switch to Outsourcing Software Development for Startups


At any unpredictable point in time, every startup hits rock bottom. They may have been in business for two to three years, expanding effectively, and have secured sufficient initial capital to pursue greater ambitions and plans. It may be a fantastic moment to be alive for them until they reach the trough!

However, they may face the uncertainty of time and need their own custom software in order to grow more effectively due to the insufficiency of the software solutions they used in earlier stages. And there comes the time for them to follow the footsteps of so many other profitable businesses and switch to custom software apps to meet the demands and aid in business expansion.

As startups grow, they have two options:

  1. Employ the talent to work in-house and absorb a substantial portion of the expense, and continue to add to that person as the business grows and the demands become greater and more sophisticated.
  2. Outsource their software solutions, performing thorough research to identify nearshore or offshore IT businesses with outstanding reputations and who come strongly recommended by others in their field.

Any firm outsourcing software development services is advisable to thoroughly analyse the advantages and disadvantages of doing so vs keeping everything in-house in prior or else they might have a lot to lose.

Table of Content:

  1. Outsourcing software development for startups
  2. What is Software Outsourcing?
  3. Reasons To Choose Software Development Company

3.1 Access to a larger talent pool

3.2 Cost Savings

3.3 Flexibility and Speed

3.4 Faster time to market

3.5 Time Optimization

3.6 Agility with Quality

3.7 Dedicated Software Support

  1. Why is Outsourcing Software Development Important?
  2. Conclusion

Offshore development is a prudent business option that allows businesses to optimise their production while being cost-effective. This time-tested method has established itself as the new standard since it enables companies to concentrate on their primary growth objectives while leaving critical software development needs in the finest hands. This definitely aids in establishing a competitive edge in a technologically advanced industry.

Additionally, outsourcing software projects is always a wise choice if the in-house IT staff is overburdened since it ensures that the project gets the care and expertise it needs. As a result, there is no sacrifice of quality.

Now that we’re extolling the virtues of IT project outsourcing, what does it actually mean? Consider the following.

2. What is Software Outsourcing?

In its simplest form, software development outsourcing refers to an arrangement in which an organization hires an external software development service provider to efficiently complete all activities associated with a software development project that might be completed in-house. Outsourcing software is the process by which software development companies cede control of a particular business process or project to a third-party provider who is competent and capable of doing the essential business activities.

According to a Statista research on “IT functions outsourced globally 2017, software development services was the most often outsourced IT function, as indicated by 64% of respondents.” Indeed, software outsourcing is a critical factor in the continuing expansion of the global IT outsourcing industry.

According to new research by Statista, the worldwide IT outsourcing industry was worth an astounding 66.52 billion US dollars in 2019. Additionally, according to Technavio research titled “IT Outsourcing Industry by Service, End-User, and Geography – Projected and Analysis 2020-2024,” the IT outsourcing market is expected to increase by USD 98 billion over the forecast period of 2020-2024.

Such robust figures suggest that the market of software outsourcing will continue to grow as businesses seek to digitize and improve their business processes, which serve as the foundation for their organisation’s digital transformation.

Nowadays, technology advances at a breakneck pace, to the point that new technology introduced this year may become outdated the next year. Competition is fiercer than ever, and as a result, it is critical that businesses continue to evaluate and adapt to new business trends, moving toward a cost-effective operating model covered in software development contract that incorporates offshore outsourcing as a viable option for staying ahead of the competition.

Software outsourcing is growing in popularity as organisations choose to outsource their development projects due to the numerous benefits, which include reduced development costs and rapid access to a vast pool of IT tech expertise. Software outsourcing is extremely promising for businesses wanting to acquire a competitive edge through collaboration with tech talent located across the world.

3. Reasons To Choose Software Development Company

3.1 Access to a larger talent pool

One of the major reasons businesses outsource software development is to have access to global talent because knowledge throughout every talent and technology cannot be acquired in-house.

Businesses get access to competent labour from around the world through software outsourcing, therefore increasing their technological capabilities and scope.

Additionally, it entails being at ease. The outsourced team takes care of everything from development to deployment without the need for extra training or supervision. Bear the following considerations in mind when selecting an offshore software development company to guarantee that your software project shouts wow!

You spend less time and resources creating and administering the project but benefit from a faster development time and time to market. Due to this increased exposure to talent as a consequence of software outsourcing, the firm gains a competitive edge.

3.2 Cost Savings

Is it true that businesses may significantly reduce their operational expenses by outsourcing software development? Yes, cost reductions are the primary reason firms outsource. There are several ways that outsourcing may help you save significant amounts of money.

The majority of small-to-medium-sized firms and startups lack the technical skills and trained personnel necessary to create software effectively and flawlessly. Initial infrastructure investments might be substantial. A seasoned IT outsourcing business possesses the technical infrastructure and people necessary to develop cutting-edge applications. As a result, you may be certain of superior quality without investing millions of dollars in modern IT infrastructure.

Hiring seasoned and capable software engineers for your in-house IT staff might eat up a sizable portion of your budget. The recruiting process, training, professional wages, benefits, and incentives all add up to a high cost for your organization. However, outsourcing software development allows you to spend a fraction of the cost.

Another critical reason is that when you develop all of the software yourself, it might be prohibitively expensive for your organization. Rather than that, you might choose to outsource sections of the development process to a reputable firm. This ensures both quality and cost savings.

3.3 Flexibility and Speed

After all, speed and flexibility are critical components of any outsourced work. Not all startups seem to be the same, and this is one truth that software outsourcing firms recognize; they offer a variety of choices so that if one appears to be slow, a quick move to plan B may be made. For instance, a reputable software outsourcing firm would advise you that employing a dedicated team for each of your projects will save you time and money. Alternatively, if you want to outsource long-term, you will likely benefit from a committed staff that stays with you throughout projects, providing you with choices for achieving the same goal.

3.4 Faster time to market

Global technology firms have increasingly realized the critical nature of speed as a means of exploiting a competitive advantage. With software outsourcing, you may launch your product without primarily relying on your in-house development staff.

Additionally, by hiring remote developers for your project, you save time on project management while achieving a shorter development time and a faster time to market.

Additionally, software development outsourcing enables you to set your own timeframes and expand your specialized development staff at your convenience.

3.5 Time Optimization

In several ways, partnering with an offshore software development business may help your startup save time. To begin, unlike recruiting an in-house team, the personnel of the software business are already familiar with one another and how to operate together.

When you hire new experts, you invest considerable effort in training, acclimating them to your enterprise’s culture, atmosphere, and technology. You will undoubtedly save time if you outsource your recruiting process rather than starting from the beginning in-house.

Bear in mind that if you divert your attention away from the growth process, you will lose time. Due to the outsourced company’s extensive knowledge in their field, they will do the task quickly and effectively.

3.6 Agility with Quality

Anecdotal data shows that the agile approach contributes significantly to product quality. A more agile development environment fosters cooperation between companies and cross-functional IT development teams, resulting in unrivaled speed, efficiency, and productivity. An agile team is focused on identifying and resolving defects in order to guarantee that the final product fulfills the client’s business requirements. The agile methodology used by a highly disciplined CMMI Level 5 outsourced software firm enables the establishment of a fail-proof procedure for ensuring that the sign-offs provided in service level agreements (SLAs) are fulfilled.

3.7 Dedicated Software Support

Regular maintenance and care are required for technology-based solutions, which implies that a dedicated support team should be in place to address client concerns in real-time. When you outsource software development, you pay for maintenance as well. Additionally, with significant time zones, you may easily provide round-the-clock technical support to your clients worldwide.

Hiring a support crew would include organising training programs and seminars to ensure a thorough grasp of your product. However, by utilising your outsourced software development team to provide technical assistance for your clients, you may significantly reduce expenses while improving the user experience.

4. Why is Outsourcing Software Development Important?

Outsourcing is cost-effective, and offshore software outsourcing, in particular, helps reduce development costs, which translates into reduced market prices and more competitiveness. However, according to research by Deloitte and Dubai Outsource City, businesses are increasingly turning to software outsourcing to accomplish a range of business objectives other than cost savings.

Nowadays, IT decision-makers and business owners rely on outsourcing to streamline their operations and boost productivity. By delegating, businesses may focus on their core strengths, ensuring that their long-term strategic goals remain on track.

5. Conclusion

The reasons stated before in this article should have convinced you to employ an outsourced development team for your business. Outsourcing software development enables entrepreneurs to ensure that their product meets market requirements and is completed on time.

Outsourcing software development is not for the faint of heart. However, with the appropriate outsourcing partner, you may have access to a broad knowledge base and skill set that will enable you to produce superior outcomes in a short period of time.

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