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Why outsourcing software development is important for startups

Outsourcing is a lot faster to start right away with your project in comparison to in-house development as you don’t have to rent office space, set up the entire infrastructure for development, and not to mention that you have to go through a recruitment process for the team which is very long and tiresome. Well, these are some benefits for a business to consider. But what are the actual reasons for a startup to opt for software outsourcing?

To answer that question of yours, consider the points discussed below and decide for yourself whether or not you want to hire a software outsourcing company.

1. Reduce software development cost

It doesn’t matter if you have hired an in-house software development team or not, one thing is certain: the cost of creating it is very high. Talking about the employees alone, you have to pay them salaries, provide them with a benefits package including holidays and a lot more perks.

Some researchers also state that the cost of hiring an in-house software developer for a startup would be 2.7 times the base salary including all the taxes, and perks. That’s very expensive for a startup. For example, if you are paying $100 to your current customer then that figure would be only the salary you are paying him/her. The actual cost of that software developer to the company would be $270.

Now, that’s terrifying enough right? But what if there is a way that you can offload all these costs on someone else and spend only for the amount of work done? Why not let someone else manage all the resources including both technical and human resources so that you can operate your company freely without any burden of the extra expenditures?

And not only that, you can get a lot more done by spending a lot less money if you outsource your project for software development services. The reason behind this is you will be hiring staff temporarily, so all the costs of the employees, their equipment, packages, and all will be taken care of by the outsourcing partner you hire.

2. Bring in domain knowledge

It is not that your in-house team is not capable of doing the task. It’s just that they might not be experienced enough to manage a complex software development process all by themselves. There is no way that they can match the experience of a team that has a strong background in delivering on the expectations of the clients.

They have been working for clients from the same industry which enables them to easily predict and prevent the complications they might face along with the design and development phase of the project. And having prior knowledge by working with clients from the same industry allows them to easily understand your business needs which leads them to create effective solutions for your organization.

Also, when you collaborate with a third party, you are bringing in a set of minds with a fresh perspective which is more often necessary when you are looking for a creative solution. That is why most of the developers work as a team and even if they get stuck, they don’t hesitate to ask around in the community about their problems and doubts.

When your outsourced software development partner is hiring the team for you they will also pick the people with unique but a wide range of skills. They might hire two people for similar roles but they would never hire the same kind of person twice. Because every new head in the team is ought to bring something new to the table in one way or another. And that’s why you can make the most out of your project and your outsourcing team.

Most of the time, the niche experts are hired as the team members. So, that they can help you understand the market from the perspective of the users or the customers. And keeping the end-users in mind while developing the product is the key to the success of the product. It will take some time and effort to ensure that the team you hired can satisfy this need. But with enough research and communication, there isn’t any reason that you cannot make the best out of this amazing opportunity.

3. Better communication within the team 

Communication is the key to successful collaboration. And it becomes a more important factor when your team consists of remote developers. In the case of in-house members too, establishing clear communication is very challenging. You need to develop a genuine tea spirit and for that, you have to foster a relevant work environment too. There’s a lot of effort and also it would take time to get your team wormed up.

But if you are choosing to outsource your software development process then you can bypass all the time-consuming team-building exercises altogether. You don’t even have to worry about that. Most likely your team members work at an outsourcing company so the chances are they have already worked together on other projects previously. So they ought to have a better understanding, have a proper communication channel established, and will be working in harmony as a single unit. 

4. Easy scalability

The thing about business projects is that nothing is set in stone especially if they are about startups. With the progress of the project, circumstances may arise that you need to implement some changes. This may change your needs too. And the change in business requirements can often demand fewer or more hands-on decks. And when this happens, you have to scale your team. The type of scaling generally depends upon which industry you are working in but in general either you have to expand your o[erations leading to adding more and more people to your development team or you have to shrink your operations resulting in taking some people off the project.

Now adding new people to the team is a relatively easy task but telling people that they have to leave the project is the job no one wants to do willingly. And in the case of in-house teams, getting excused from the project mostly means getting a dismissal from the company. It’s the worst-case scenario for in-house teams. But software development companies are known to manage multiple projects simultaneously so even if they have to dismiss someone from the development team working on your project will be reassigned soon on another project.

5. Minimum risk

Risks lie everywhere and in the case of startups, the new venture itself is a huge risk. But regardless of that, we proceed with the approach that can help us mitigate the risks easily. Similarly, risks lie in both in-house teams as well as outsourced teams but comparatively, the risk is lower if you pick the latter option. As we already discussed in the first option, investment in in-house development is way higher than in outsourcing so obviously if your project fails for any reason then you have a lot to lose if you had picked the first option. 

Meanwhile, before pursuing the second option of collaborating with the outsourcing company to develop a product for you, you can assess their skills and capabilities. One way to do that is to assign them a small task and if you are happy with the outcome then provide them with a larger and a bit more complicated task. Now, if that also works out well then you know that your software product development is in the right hands. On the other hand, there isn’t any sure way to know what kind of in-house you are getting at before committing to the project.

6. Maximum flexibility

Outsourcing teams are more flexible than in-house teams. They have been working in the software development industry for years across a wide range of projects. They are constantly honing their skills and adapting the latest trends and technologies to meet the demands of their clients.

The outsourcing companies also know that the needs of a client may change during the project. So they create a project plan accordingly beforehand by making enough room to accommodate those changes. In contrast to that, in-house developers don’t possess that kind of flexibility. They work at the same company and on the same project for years. And it’s highly unlikely of them to work on something extra beyond their official work hours.

Conclusion

There are many more reasons but I’m sure that these six reasons are strong enough to convince you that outsourcing software development for startups is very important. Thanks for reading this article. I hope you find it helpful.

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