Can more affordable nearshore or offshore software development services be as good as those you have on hand in your country? Does high quality = high price? In this article, we look at the top 9 most popular outsourcing locations and analyze their rate and quality differences.
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A top Swedish JavaScript custom software development company can charge as high as $100-150 per hour of service.
But, if you virtually travel 159 km, you'll find yourself in Poland.
Here, the same type and grade of services are set at $50-100 per hour (Clutch, 2022), and the number of vendors is 15x higher.
What about other regions?
In this examination, we're taking a closer look at rate, quality, and availability differences among world’s top 9 outsourcing destinations.
Jump to a region of your interest to learn more:
We've based our research on software quality rankings by HackerRank, TopCoder, and Pentalog, and companies' rates information available on Clutch.
To evaluate software development quality by country, we used the scores of HackerRank - the market-leading technical interview platform. HackerRank posts thousands of coding challenges to test developers' skills and, based on that, creates their ranking of the top programmers by country. As they rank over 1.5 million experts, their data is among the most reliable and quoted.
Offshore and nearshore software development rates are based not only on the region standards but also on the technologies, seniority level and company size. The countries we have discussed are the most popular and best options to outsource to, and each has a slightly different profile and capabilities. Choosing the ideal vendor depends largely on its location, which affects the cooperation flow due to cross-cultural differences and time zones.
<span class="colorbox1" fs-test-element="box1"><p>Explore the ranking of top custom software development companies from these countries.</p></span>
<span class="colorbox1" fs-test-element="box1"><p>Top skills: Java, SQL, Python, PHP</p><p>Quality score (HackerRank): 3</p><p>Custom software development rates in Poland: 45-70$</p><p>Number of software development companies in Poland: 1050</p><ul><li>Small-Market vendors (<50 employees): 702</li><li>Mid-Market vendors (50-249 employees): 265</li><li>Big Business vendors (250-1000 employees): 53</li><li>Enterprise vendors (>1000 employees): 30</li></ul><p>Top custom software development companies in Poland:</p><ul><li>Brainhub</li><li>10Clouds</li><li>Future Processing</li></ul></span>
Poland is a gigantic tech market of about 400k developers and more than 1,050 custom software development companies (Clutch, 2022) so you won't have a problem finding any service you need. Also, if you're interested in innovative technologies, Poland is a great destination for both nearshore and offshore as it ranks 5th in the Harvard Business Review ranking highest tech skills by country.
Polish programmers are valued for their professionalism, development quality and skill level - it's hard to find a report that doesn't list them in the top 10 globally. According to HackerRank, Poland ranks 3rd in terms of the best developers in the world. Moreover, Polish web design is at a very high level, just look at the Awwwards rankings.
Also, almost 40% of Poles speak English as a second language, while in the IT market, it's almost 100% (Statista, 2022) which makes it much easier to communicate while running projects.
<span class="colorbox1" es-test-element="box1"><p>Check out the ranking of top software development companies from Poland.</p></span>
Poland is the most popular outsourcing destination for Western European businesses due to the small time difference, similar cultural context and great work culture. Its presence in the European Union also makes it easier to do business there. US companies often offshore to this country due to the excellent quality of development and client service for a reasonable price. Polish vendors have a great reputation for being reliable, professional, dedicated and easy to work with.
<span class="colorbox1" fs-test-element="box1"><p>The most popular services: Custom software development, Web and Mobile development, Web design, AI and cloud based solutions.</p><p>Best fit for:</p><ul><li>Those looking for the best quality development, innovative technologies and high work culture at a good price</li><li>Business, Financial, Medical and eCommerce industries</li><li>Enterprise and Mid-market companies</li></ul></span>
<span class="colorbox1" fs-test-element="box1"><p>Top skills: SQL, Ruby, Java, and Python</p><p>Quality score (HackerRank): 11</p><p>Custom software development rates in Ukraine: 30-60$</p><p>Number of software development companies in Ukraine: 917</p><ul><li>Small-Market vendors (<50 employees): 851</li><li>Mid-Market vendors (50-249 employees): 42</li><li>Big Business vendors (250-1000 employees): 47</li><li>Enterprise vendors (>1000 employees): 12</li></ul><p>Top custom software development companies in Ukraine:</p><ul><li>Digis</li><li>Geniusee</li><li>KeenEthics</li></ul></span>
Ukraine, with more than 200k programmers and 900 custom software development companies (Clutch, 2022), is the second largest technology market in Europe after Poland.
Ukrainian programmers are rated very high in terms of skills in most global rankings - according to HackerRank; they are ranked 11th on the list of the best developers in the world. Ukraine is also one of the region's leaders in web design with 419 projects titled by Awwwards. Ukraine has built a position as a trustworthy business partner with a Western business model, excellent English and a high skill level and is a perfect place to nearshore for Western European countries.
You're probably wondering if it's too risky to outsource software development to Ukraine during a time of war. But the truth is that the IT market in Ukraine continues to grow, with 96% of contracts staying secured and maintained (IT Ukraine Association, 2022). Not to mention the ethical aspect of supporting Ukrainian business.
<span class="colorbox1" fs-test-element="box1"><p>The most popular services: Web development, Mobile development, Custom software development, UX/UI design</p><p>Best fit for:</p><ul><li>Those looking for a large tech hub of skilled professionals and high work culture for reasonable money</li><li>Financial, Medical and eCommerce industries</li><li>Small-market and Mid-market companies</li></ul></span>
<span class="colorbox1" fs-test-element="box1"><p>Top skills: SQL, Ruby, Java, and Python</p><p>Quality score (HackerRank): 20</p><p>Custom software development rates in Romania: 25-50$</p><p>Number of software development companies in Romania: 367</p><ul><li>Small-Market vendors (<50 employees): 247</li><li>Mid-Market vendors (50-249 employees): 86</li><li>Big Business vendors (250-1000 employees): 27</li><li>Enterprise vendors (>1000 employees): 7</li></ul><p>Top custom software development companies in Romania:</p><ul><li>Atta Systems</li><li>Tapptitude</li><li>Tremend Software Consulting</li></ul></span>
Romania is experiencing a real technological boom. Nearly 140 k programmers and more than 360 custom software development companies make it the third largest technology market in the region. This is a country with ambitions to become a technology-oriented economy, and the government is very much supporting intensive development in this direction. In addition, Romanians speak English very well which makes communication easier.
To distinguish itself from its neighbors, Romania offers noticeably lower custom software development rates than technological giants in the region, such as Poland, Ukraine and the Czech Republic. However, the low price has its consequences as Romania fares worse in the quality rankings (20th place according to HackerRank). Nevertheless, Romania is a relatively big market and there is no shortage of skilled developers and great vendors. You just need to do some research.
Romania is a popular outsourcing destination mainly for Western European countries due to its geographic proximity.
<span class="colorbox1" fs-test-element="box1"><p>The most popular services: Web development, Mobile development, Web design</p><p>Best fit for:</p><ul><li>Those who prioritize low software development rates and small time differences (for European countries) and are ready for solid quality research</li><li>Financial, Medical and Business industries</li><li>Small-market and Mid-market companies</li></ul></span>
<span class="colorbox1" fs-test-element="box1"><p>Top skills: Java, C++, Python</p><p>Quality score (HackerRank): 3</p><p>Custom software development rates in India: 20-40$</p><p>Number of software development companies in India: 3779</p><ul><li>Small-Market vendors (<50 employees): 2637</li><li>Mid-Market vendors (50-249 employees): 922</li><li>Big Business vendors (250-1000 employees): 180</li><li>Enterprise vendors (>1000 employees): 40</li></ul><p>Top custom software development companies in India:</p><ul><li>GeekyAnts</li><li>GroovyWeb</li><li>Taazaa</li></ul></span>
5.8 million developers and over 3,700 software development companies. In the case of India, we are dealing with a completely different scale of the industry compared to Eastern and Central European countries. The market is huge and growing rapidly as India becomes the outsourcing alternative to China in its region. Offshore software development rates here are super low.
The case of India in the technology market is interesting because there is a great deal of diversity in quality. On the one hand, India is training a lot of programmers and is a real mine of talent. On the other hand, finding highly qualified professionals in such a huge market is not easy, as the average quality of development is rated relatively low (31st according to HackerRank), and many programmers lack experience and expertise.
Customer service could also be better, especially since relatively few people speak English and the time differences are huge. India is the most popular outsourcing destination for large U.S. and Western European corporations and companies with small budgets.
<span class="colorbox1" fs-test-element="box1"><p>The most popular services: Web development, Mobile development, IoT, Blockchain solutions</p><p>Best fit for:</p><ul><li>Those for whom the lowest possible software development rates are a priority</li><li>Business, eCommerce, Medical, Real estate industries</li><li>Small-market and Enterprise companies</li></ul></span>
<span class="colorbox1" fs-test-element="box1"><p>Top skills: Python, Java, Algorithms and Functional Development</p><p>Quality score (HackerRank): 1</p><p>Custom software development rates in China: 25-50$</p><p>Number of software development companies in China: 210</p><ul><li>Small-Market vendors (<50 employees): 99</li><li>Mid-Market vendors (50-249 employees): 59</li><li>Big Business vendors (250-1000 employees): 26</li><li>Enterprise vendors (>1000 employees): 26</li></ul><p>Top custom software development companies in China:</p><ul><li>Northern Lights Technology Development</li><li>Digital Creative</li><li>Design & Digital Technology Services Limited</li></ul></span>
The market in China consists of 7 million highly regarded (1st place in the HackerRank list) programmers. According to Statista, up to 40k software companies are registered in China, but only 210 are listed in Clutch, making it difficult to verify them.
With the issue of quality, the problem is similar to India - if you choose well, you will work with the best of the best. However, in such a huge market, it's easy to run into a company that will make a product quickly at the cost of quality. And as you know, in the long run, poor software does not pay off.
The average hourly wage is $25-45 per hour, but the low cost of development comes at a price of reinforcing a stressful work culture. China is known for its '996' model, which means working from 9 AM to 9 PM 6 days a week, and the very low wages paid to employees.
Moreover, only 1% of Chinese people speak English which can cause communication difficulties. China is the most popular offshore destination among large US corporations.
<span class="colorbox1" fs-test-element="box1"><p>The most popular services: Functional development, Algorithms, AI, Big Data, Mobile development</p><p>Best fit for:</p><ul><li>Those for whom low cost is paramount, even despite the low work culture and quality risk</li><li>Business, Real estate, eCommerce, Tech industries</li><li>Big Business and Enterprise companies</li></ul></span>
<span class="colorbox1" fs-test-element="box1"><p>Top skills: PHP, ASP.NET, Ruby</p><p>Quality score (HackerRank): 46</p><p>Custom software development rates in the Philippines: 20-45$</p><p>Number of software development companies in the Philippines: 106</p><ul><li>Small-Market vendors (<50 employees): 58</li><li>Mid-Market vendors (50-249 employees): 24</li><li>Big Business vendors (250-1000 employees): 17</li><li>Enterprise vendors (>1000 employees): 7</li></ul><p>Top custom software development companies in the Philippines:</p><ul><li>LANEXUS</li><li>Chromedia</li><li>KODA Kollectiv</li></ul></span>
Rapid technological development in recent years make the Philippines another tech hub in the region with the number of programmers resting at approximately 200k.
Over 92% of Filipinos speak English and this is a huge advantage in terms of communication during cooperation. We can characterize the Philippines as an eastern business model with a western work culture.
This country is oriented towards foreign outsourcing therefore, despite the large time differences, it offers 24/7 project support. This convenience makes it a very popular offshore destination for the US and Western Europe.
The popularity of the Philippines as a country to outsource to is growing, although it still lags behind top technological hubs like Poland, Ukraine, or China (ranked 46th according to HackerRank), making it a good option for rather simple projects.
<span class="colorbox1" fs-test-element="box1"><p>The most popular services: Web development, Mobile development, Web design</p><p>Best fit for: </p><ul><li>Those who are looking for good customer service and low prices, but have a rather simple project to do that does not require innovation and top skill level.</li><li>Tech, Business, Consumer products industries</li><li>Small-Market and Mid-Market companies</li></ul></span>
<span class="colorbox1" fs-test-element="box1"><p>Top skills: Java, Python, SQL</p><p>Quality score (HackerRank): 38</p><p>Custom software development rates in Brazil: 25-50$</p><p>Number of software development companies in Brazil: 243</p><ul><li>Small-Market vendors (<50 employees): 147</li><li>Mid-Market vendors (50-249 employees): 65</li><li>Big Business vendors (250-1000 employees): 18</li><li>Enterprise vendors (>1000 employees): 13</li></ul><p>Top custom software development companies in Brazil:</p><ul><li>Cheesecake Labs</li><li>Snowman Labs</li><li>DB1 Global Software</li></ul></span>
Nearly 500k developers and 250 software companies listed on Clutch are available in Brazil. It's a huge market, accounting for nearly half of the industry in Latin America, making it the most popular country to outsource to in the region.
Brazil is making a lot of efforts to open up its economy to foreign countries and facilitate outsourcing, for example, the 2017 outsourcing law and the General Personal Data Protection Act (LGPD), the equivalent of Europe's GDPR.
The overall percentage of English speakers is not very high which can be a communication barrier, although in top software companies this should not be such a problem. In terms of development skills, Brazil ranks only 38th on HackerRank's list.
Even so, significant price differences and geographic proximity (only 4 h difference between Brazil and the US) make many North American companies choose Brazil as a destination for nearshore development.
<span class="colorbox1" fs-test-element="box1"><p>The most popular services: Web development, Mobile development, IT Managed Services</p><p>Best fit for:</p><ul><li>U.S. companies that are looking for a cheaper alternative to local vendors and value cooperation during regular business hours.</li><li>Advertising, Manufacturing and Logistics industries</li><li>Big-Business and Enterprise companies</li></ul></span>
<span class="colorbox1" fs-test-element="box1"><p>Top skills: Java, Python, SQL</p><p>Quality score (HackerRank): 39</p><p>Custom software development rates in Argentina: 30-55$</p><p>Number of software development companies in Argentina: 347</p><ul><li>Small-Market vendors (<50 employees): 229</li><li>Mid-Market vendors (50-249 employees): 97</li><li>Big Business vendors (250-1000 employees): 24</li><li>Enterprise vendors (>1000 employees): 7</li></ul><p>Top custom software development companies in Argentina:</p><ul><li>eCloud Solutions</li><li>Patagonian</li><li>NaNLABS</li></ul></span>
What makes Argentina special in the industry?
Firstly, it's the country with the highest rate of English proficiency in all of Latin America (about 15%), and that's a good ground for potential collaboration.
Secondly, Argentina's geographical location is very convenient. There are only four hours by plane to Silicon Valley, and the time difference between the US and Europe is rather small.
Thirdly, the Argentine government is very supportive of the country's technological growth, with a focus on training new programmers, involving women in the IT industry, and developing startups.
Although, for the time being, Argentina is ranked 39th in HackerRank, there is no doubt that their position will strengthen. Argentine companies are recognized for their high work culture, focus on relationship building and great desire to grow.
Most outsourcing clients come from North America.
<span class="colorbox1" fs-test-element="box1"><p>The most popular services: Web development, Mobile development, Custom software development</p><p>Best fit for:</p><ul><li>Those who value relationship building and close cooperation on projects</li><li>Business, Consumer products, Retail industries</li><li>Mid-Market and Big-Business companies</li></ul></span>
<span class="colorbox1" fs-test-element="box1"><p>Top skills: PHP, Java, Python</p><p>Quality score (HackerRank): 33</p><p>Custom software development rates in Mexico: 40-70$</p><p>Number of software development companies in Mexico: 450</p><ul><li>Small-Market vendors (<50 employees): 317</li><li>Mid-Market vendors (50-249 employees): 96</li><li>Big Business vendors (250-1000 employees): 25</li><li>Enterprise vendors (>1000 employees): 12</li></ul><p>Top custom software development companies in Mexico:</p><ul><li>eTeam</li><li>Ancient</li><li>Icalia Labs</li></ul></span>
Mexico with more than 100k developers becomes the region's next tech hub. The 13,000 computer sciences graduates place the country sixth in the world. The relocation of large corporations tired of long-distance cooperation from Asia to Mexico is also responsible for the country's growing position. A great example is the large business hub of Guadalajara, called Mexico's Silicon Valley.
The main difficulty Mexico faces is an image crisis related to its high crime rate and drug gang activity. For this reason, many businesses are concerned about the stability of cooperation with Mexican companies, and many skilled professionals emigrate to the United States.
Mexican developers are ranked 33rd by HackerRank. Nearshore software development in Mexico is particularly popular in the US because of the country's strategic location at the meeting point of the two Americas. A small time difference and plenty of flights enable close cooperation during regular working hours.
<span class="colorbox1" fs-test-element="box1"><p>The most popular services: Web development, Mobile development, Big data</p><p>Best fit for:</p><ul><li>US companies that are looking for a business partner in the same time zone, good quality and favorable custom software development rates.</li><li>Business, Medical, Consumer products industries</li><li>Mid-Market and Big-Business companies</li></ul></span>
The size of the vendor is crucial in choosing a company that will meet your business needs. For example, if you are the director of a large corporation and need many developers, hire an enterprise or big-business class company that has the right people and technology resources.
An important factor in choosing a country to outsource to is also the size of the market. Larger markets are more competitive because companies have to upgrade the skills of their employees to keep their position, so that's where you'll find the most skilled developers.
What's more, with hundreds or thousands of software development companies to choose from, you can be more picky about work culture, specific skills, technologies, etc. so you can find not just fine but a a great business partner.
Custom software development rates, technological advancement, time differences, and business model are the basics when choosing an offshore or nearshore company. However, there are other factors to take into consideration as they determine the quality and flow of cooperation.
Regulations, tax conditions, percentage of business failures, investor support - all factors affect the market condition and stability, and thus the quality and security of cooperation.
When choosing a country to outsource, research the current situation in the region. For a long time, the most reliable source of information on the ease of doing business was the index conducted by The World Bank. However, since 2021 the report is not renewed, so check the economic analysis of the location you are interested in.
This index determines the possibility of volatility in a country's political and economic situation and takes into account factors such as the risk of war, government destabilization, and the threat of terrorism or violence.
Company's approach to clients and its policies toward its employees are the key factors affecting the quality of cooperation. It varies greatly from company to company and by the standards in the country.
In one company, an experienced and motivated team will communicate with you at every stage of the project, give you extensive feedback and offer top-quality client service. On the other, you'll wait a week to get an email response, you won't have insight into the status of the project, and your corrections will be made inaccurately by inexperienced developers.
When choosing your new vendor, verify not only the country's work ethic standards but also the company's values.
The work speaks for itself, so check the portfolio before you start working together. First, take a broader approach and see the biggest clients who outsource services in a given country, and then look at what projects the company you are interested in has completed.
<ol><li>Offshore and nearshore development is a perfect opportunity to find the world's most talented programmers while getting lower rates for custom software development.</li><li>Average custom software development rates by country may vary depending on skill level, technologies offered, work culture, quality of customer service and seniority. </li><li>Each region has its own characteristics in terms of outsourcing:</li><ul><li>Central and Eastern Europe is an option for those who are looking for the best quality in the market at a favorable price and value a high work culture.</li><li>Asia is the choice for those for whom the most important thing is a low price for services and are ready for large time and culture differences (when compared with EU and the US) and research a huge market to find the best quality.</li><li>Latin America is the destination for the US companies for whom geographical proximity and working hours are most important even though the quality of development may be lower than in other regions.</li></ul><li>Larger markets are more competitive and offer a wider range of services, so you'll meet the most skilled developers and more specialized technologies there. An enterprise-class business will likely find the best match among the enterprise-class vendors, so pay attention to the availability of big companies in a given market.</li><li>Factors that affect the flow of cooperation include the ease of doing business, political stability, English proficiency and working culture, so take them into account when choosing a country to outsource to.</li></ol>
Now that you've learned how to pick the right outsourcing region, it's time to prepare your Request for Proposal (grab these two free templates to make the process easier) and start contacting custom software development companies.
And, if you've decided to opt for a partner from Poland, why not use the ocassion and talk with Brainhub? Learn more about our web development services here.
There is no doubt that Poland is currently the best country to outsource software development. It offers the most skilled programmers in the world, top customer service, high work culture and lower rates than in Western countries.
It's a large market offering many big-business and enterprise vendors, so you'll find top quality and all technologies and services here. Because of its geographic proximity, it's the most popular destination to outsource to among Western European countries, and with its flexible hours and adaptation to remote working, it'll also be a great business partner for US companies.
The average react native developer rate in Poland is about 40-65$ per hour. By comparison, the hourly rate in the US averages 100-140$.
The average JavaScript rate in Poland is about 35-60$ per hour. By comparison, the hourly rate in the US averages 95-145$.
The average web development rate in Poland is about 45-70$ per hour. By comparison, the hourly rate in the US averages $110-150.
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Software development enthusiast with 8 years of professional experience in this industry.
Software development enthusiast with 8 years of professional experience in this industry.
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