Is Outsourcing Software Development Right for You? Exploring Cost Savings & Expertise

Published on:
March 11, 2024

In recent decades, digitization has been a vital force behind company growth. Businesses concentrate on creating applications that streamline processes and enhance client interactions. However, not all companies can maintain an internal software development staff.

Because of this, the outsourcing of software development has grown significantly over the past few decades. Two main reasons for outsourcing software development businesses - speed and cost management. As the creators explain - "They can build efficient solutions quickly & maintain software development pricing within the prescribed budget."

Additional benefits of outsourcing software development include increased security, reduced risk, and increased productivity. Startups and well-established businesses alike are outsourcing their software development projects.

Yet to grasp this opportunity? In this MarsDevs article, let’s tell you more about software outsourcing and how it may help your company. So, let’s get started!

Outsourcing in Software Development - The Fundamentals

Outsourcing in Software Development - The Fundamentals

As to Gartner's projection, software development had a massive growth rate of 10.5%, with worldwide IT investment estimated to reach $3.9 trillion by 2020. The research projected that by 2023, the worldwide market for IT outsourcing spending will reach $1.3 trillion. 

About 25% of businesses outsourced software development for their projects because they aim to reduce costs, increase flexibility, shorten time-to-market, and access a large talent pool. The aforementioned suggests a strong inclination towards IT outsourcing in the upcoming years.

Businesses of all sizes are continuously looking for cutting-edge IT outsourcing trends since the newest developments and boundless possibilities of technology will inevitably lead to digital transformation.

So, why do businesses outsource?

Do you believe that companies just use offshore outsourcing companies because they are cost-effective? Rethink that!

According to a Technavio analysis, the primary driver of IT outsourcing in the upcoming years would be the growing requirement for business process optimization. Whether they are large IT enterprises or tiny start-ups, they all choose to outsource to a reliable software development business these days to increase productivity, save expenses, and save time. 

Other reasons include:

top reasons to outsource software development
  • Access to Specialized Expertise: Through outsourcing, businesses may gain knowledge from experts in particular fields or technologies, which can speed up development and enhance the caliber of outputs.
  • Cost Savings: By taking advantage of the differences in cost across nations, outsourcing dramatically lowers development expenses. It makes it unnecessary to invest in infrastructure upfront and permits flexible resource allocation.
  • Time Efficiency: Organizations may gain from shortened project schedules, quicker time-to-market, and more efficient development procedures by working with a seasoned software development firm.
  • Flexibility & Scalability: Depending on the project demands, outsourcing enables businesses to grow or shrink their development teams. It makes it possible to quickly adjust to shifting market conditions and guarantees the best use of available resources.

How To Make Outsourcing Work For You?

If you own a business, you know how vital software development is to your daily operations. However, creating software may be expensive, time-consuming, and challenging to oversee. So, how can you strategize success?

Consider expertise as a mandatory requirement:

One developer's benefit is that he can have different skill sets. However, when you are working on a large project, you need a developer that has the ideal tech stack and domain understanding. Expertise and domain knowledge are essential because:

  • Domain expertise helps the outsourced team understand the unique requirements and objectives of the company, guaranteeing that the finished product satisfies market demands.
  • The outsourced team's deep domain knowledge enables them to anticipate and resolve industry-specific roadblocks and issues that can arise during the development process.
  • Domain expertise guarantees that the solution satisfies relevant compliance and regulatory requirements and helps with testing following industry-specific use cases and standards.
  • The outsourced team could help the project with innovative ideas and industry-specific best practices with their domain knowledge.
  • The outsourced team's ability to detect risks early on and use proactive risk management techniques is aided by domain knowledge.

Budget overruns may make or break your business:

Even if you pay the outsourced tech team a lot to finish the task, outsourcing software development can reduce money. Why? A global workforce can be hired through outsourcing, and you could gain from having a specialist from a region with lower overhead expenses than typical. 

There are additional elements that are advantageous to you. In addition to helping companies launch their products or solutions more rapidly and save overhead expenses, outsourcing helps speed up the software development process. When you deliver products on schedule/even ahead of schedule, you get satisfied clients, consumers & new business.

Outsourcing offers substantial cost savings by providing access to competent labor in nations with cheaper labor costs. That can save a lot of money if internal developers are hired in nations with higher wages.

By doing away with the requirement for internal staff expenditures like pay, benefits, workspace & equipment, outsourcing results in significant overhead savings.

As experts suggest, “Coordination of resources, project management & supervision are required for managing an internal development team. These issues are generally carried out by outsourcing firms, which reduces managerial overhead.”

Accounting can be your best bet:

Software projects are typically plagued with difficulties and hurried additions, deletions, and modifications. It means that when it comes to software development, planning for every scenario is essential. 

For instance, imagine you require professional assistance to design a mobile version of your website that works on all platforms. Scaling up or down is an eventuality that we always need to consider. These situations may be avoided by outsourcing your software development as follows:

  • Your development team can be scaled up or down in response to changing project needs, altering workloads, and meeting deadlines.
  • Depending on changes in the market, customer expectations, or strategic advancements, meeting all company needs may not always be possible. You can adapt to these changes with a scalable outsourcing contract without arranging your development crew.
  • Scalability guarantees outsourcing's cost-effectiveness. Because you may adjust the size of your outsourced team to suit the project demands, you can avoid the disproportionate expenses for maintaining a fixed-size team during depressed demand.
  • In outsourcing, the ability to swiftly scale up resources is essential. With scalability, you may quickly add more developers or experts to your team during unexpected workload surges or tight deadlines.

Workload peaks in some projects might occur due to specific milestones, product releases, or events.

What To Examine Before Proceeding To The Next Step?

Although outsourcing can be efficient and cost-effective, it can also be challenging to guarantee that the finished product will live up to expectations regarding quality. Here’s what you should consider:

Your requirements

Before selecting an outsourcing provider for software development, the first thing you should do is ask yourself, "What precisely does my organization need?" One of the vital causes of a software development project failing is unclear goals. 

When you understand the requirements well, you can solve the problem. A clear explanation of your project's aims and objectives aids the customer in better understanding your needs and making the best recommendation.

Find a suitable provider!

Find a suitable provider!

The next step is to choose the best software development firm for your project after you have determined your needs. When you outsource, you can select a supplier based on your requirements. The following are things to imagine when searching for software development outsourcing providers.

Experience: Find out how long a development firm has been in business and what projects they have worked on before employing them. Experience is essential since you want a project manager with higher expertise.

Client feedback: To determine the caliber of a company's work, look at its client reviews. Reputable businesses guarantee superior customer service, which is evident in their evaluations.

Check out the security policies:

An assessment of the security policies is one of the most crucial factors to consider when outsourcing software development. You and your clients may be at risk for cybersecurity when you exchange private information with another company. 

Before you accept any contracts, find out about their security procedures and ensure the business you are considering has never experienced a data breach.

Summing Up 

The first steps to success in software development outsourcing are selecting the ideal outsourcing partner and opting for sensible methods. You may realize the full potential of outsourcing by carrying out exhaustive research, establishing efficient communication procedures, and overcoming obstacles related to culture and time zone differences.

Remember to take legal matters into account and protect your intellectual property. You can confidently and wisely, with a dash of humor, set off on this exciting voyage by keeping these things in mind.

Need to drive your business to new heights with software development outsourcing? MarsDevs can help! Contact MarsDevs & we would be happy to help you.


  1. What is software development outsourcing?

The process of delegating software development tasks to an outside organization or group is known as software development outsourcing. Cost reductions, simple access to specialist expertise, more flexibility, and a quicker time to market are some advantages.

  1. In what ways does software development outsourcing give organizations more flexibility?

Businesses that opt for outsourcing software development can scale up or down resources in response to project needs. They may do away with the constraints of an internal team by changing the team's size and skill level as needed.

  1. Can businesses accelerate the launch of goods or services by outsourcing software development?

Software development outsourcing may shorten the time to market. Businesses may gain a competitive edge by shortening development cycles and launching goods or services more rapidly by utilizing external skills and resources.

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