Outsourcing is a cost-effective and easier option for businesses, as opposed to hiring resources and building an in-house infrastructure. It facilitates convenient growth for businesses, so much so that the global outsourcing market has grown from USD 92.5 billion in 2019 to USD 268.21 billion in 2021, and is expected to cross USD 576 billion by 2030. However, when you set out to hire web developers or a web development company, the real challenge is finding someone who can deliver on your expectations without exceeding your budget.
Here’s a guide to simplify that process for you. Let’s discuss the process and precautions for engaging a web development company.
How To Outsource Web Development?
The IT Outsourcing industry has gained even more momentum. The numerous benefits it offers have worked like a catalyst, and so has the fact that outsourcing helps in cutting costs and provides access to resources from a global talent pool. However, it is always better to plan and prepare as per your business requirements once you decide to outsource web development.
The following steps can help you organize and execute the outsourcing.
1. The Type Of Outsourcing
Before you can hire web developer or strategize a web development project task, you should first choose the type of outsourcing required. Outsourcing models are usually location, relationship, or pricing-based. Since each comes with its specific ups and downs, choosing an outsourcing model involves considerations like the distribution of tasks, control over the team, pricing criteria, time zone, related communications, etc. Here are three of the most popular types of outsourcing that a business should consider before moving forward.
| Onshore Outsourcing to a company located in the same region or country. – Easy to travel and arrange meetings – Accessible communication – Same time-zone | Nearshore The outsourcing partner is situated in the nearest location. – Can do physical meetings – Similar work culture – Easy to Supervise operations | Offshore The firm is located far away, in a different country, or even on other continents. – Advantage of time zones – Access to global knowledge & experience – Cost-effective -Scalable – Advantages of difference in labor cost and currency |
2. The Cost Structure
Based on your requirement, goals, and budget, different outsourcing cost models can be chosen. Most outsourcing web development companies offer customized packages too, where a relevant model can be prepared based on the discussions between firms. Generally, the following cost models are used in outsourcing:
| Fixed Cost – In this model, a fixed payment plan is devised as per the deliverable. Any new service demand gets added as per the price chart. – Services may include the development of websites, mobile apps, software, or any advanced technology. – You should discuss in detail the scope of your project and the deliverables that might fit beforehand to avoid confusion later. | Dedicated Team-Based – As per the project’s requirement a dedicated team with compatible qualifications, experience, and expertise is engaged for the outsourcing firm. Time and scope are pre-decided. – The engaged outsourcing firm charges as per the project. The dedicated team is focused on outsourced projects only and works exclusively for one client only. – According to the project requirements, the respective team’s skill set should be decided. You should also analyze future needs, reporting, and timeline. | Time & Material – It is a versatile model that relies on outsourced assignments. Cost is calculated and paid on an assignment basis. – Companies with evolving needs & without any long-term requirements use this model. – It is a simple model where any required task is outsourced and paid for on delivery. |
3. Define Your Project
Once you are clear about the different types of outsourcing and various costing models, get some clarity on your project. The following points will help.
- What is the goal of the project?
- What is the vision behind the project?
- Who is it addressing?
- What is the plan for marketing?
- How will it scale? Do you need to scale it in the future?
- List out a timeline
- Sketch a growth path
- Define the structure of the project and different modules involved.
- Define each module and its purpose.
- Add relevant user stories
For clarity, let’s understand this with an example of a customer support portal. You need to detail the structure for the customer portal; define possible modules like login, user profile, complaints, feedback, payment, rating, etc. Once this is clear, you can ask the outsourcing partner to plan the project accordingly, create a development timeline, and share a cost structure.
4. Budget Calculation
Analyze the approximate work hours for skilled and unskilled human resources and note the average cost. Add infrastructure, tools, and software expenses to set up the department in-house. Based on these, calculate a rough cost that the project involves. Increase it to 15%-20% for missing variables.
Once you have estimated the in-house budget, take quotations from web development outsourcing companies. Comparing the two, a rough profit figure can be calculated.
This will help you negotiate a better package with your outsourcing partner.
5. Finding The Outsourced Agency
Prepare a list of suitable outsourcing partners. You can use search engines, read reviews on major business-rating websites, and check with your peers and competitors.
As you choose the type of web development outsourcing that suits your company, search for a firm in the respective region with the required skill set.
The following can be the major factors in your search:
- A reliable background, with projects similar to yours.
- Team of experienced web developers to engage.
- A track record of timely delivery of projects.
- Analyze the web development company’s website.
- Check the feedback and client reviews.
Rank the chosen web development companies on these factors and choose the top few that best suit your requirements.
6. Discuss The Project
Talk to the companies that enter the final list. The idea behind this discussion is to get to know the prospects, test their capabilities (through samples), and get a rough cost estimate. You can ask more specific questions based on the following details:
- The technology stack experience of the outsourced team.
- Rough plan of the project you want them to handle.
- The style of internal workflow.
- The security measures followed to safeguard the client’s data.
- Communication, feedback, review, and improvisation process.
- The budget and packages for service.
Share your requirements (the generalized version, at least) with all service providers at this point and ask for a quotation. If they allow flexible pricing and custom requests, clarify how the pricing will work in your case. Then, choose the web development company that best suits your requirements and budget.
7. Prepare The Contract
Prepare the contract. The work contract should clearly state the services/deliverables, timeline, and costs. You can add an NDA (non-disclosure agreement) and deadline-based penalty for a more secure outsourcing with fallback mechanisms in place.
Traits of a Good Web Development Company
Before outsourcing your web development project, it’s important to know the features of an efficient company.
Some essential requirements are
➔ Quality
Without a high quality of deliverables, outsourcing is not worth it. The company should be able to provide a globally competent, upgradable, and advanced solution. It should, at the same time, be simple for the end-user.
➔ Work Process
A professional work environment is crucial for delivering an excellent result. The team management, task allotment, brainstorming, collective operation, feedback, and improvisation should run in a smooth process.
➔ Technology
Technical skills are the most crucial part of a web development project. The knowledge of traditional and trending tech stacks can only provide advanced software solutions. Apart from this, technical experts should be able to identify the scope of integrating popular add-on technologies for a better user experience.
➔ Security
Data security mishaps can lead to big blunders in web development. Make sure the outsourcing partner follows multi-layered security encryptions to protect against any leakage.
➔ Pricing
The costing should be compatible. The financial feasibility of outsourcing is based on cheaper investment in comparison to an in-house setup. The offered package should have scope for relevant scalability and be customizable as per requirements.
➔ Testimonials
These work well to check the reliability and build trust. Generally, outsourcing firms list testimonials from clients on the website. You can ask for previous client feedback on services too.
Why Do You Need To Outsource Web Development Services?
Whether it is a start-up or a big business house, the confusion regarding the pros & cons of outsourcing web development is always there. Once the need to outsource web development is understood, it will get easier to choose between hiring software developers in-house and outsourcing website development. The external partner can be of great advantage as compared to the internal team.
You need to outsource web development because
➔ Access To Experienced Manpower
Outsourcing web development gives you access to a large technology pool. This will generate a better focussed and precise output. The web development company’s whole expert team is at your disposal. It saves your manpower investment and provides a reach to a global knowledge base. You get access to professional human resources like QAs, PMs, UX designers, and marketers.
➔ Saves Costs
It is cost-effective. As the infrastructure and human resource is managed by the outsourcing partner, a large amount of financial investment is saved. The difference in labor costs is also beneficial for companies, along with the economics of hiring a software developer. This results in businesses saving approximately 20% of the web development investment, on outsourcing it.
➔ Focus On Core Business
Outsourcing web development will help you focus on the core business processes. It reduces the stress of the project’s progress, quality, and day-to-day expenses. Thereby you can maintain the workflow of your core competencies. It is one of the major requirements of companies to manage a web development project without affecting regular business flow, engaging a web development company can help you achieve this goal.
➔ Scalable As Per Requirement
Every company has a growth plan. Based on the scope of your project, web development outsourcing firms are flexible for any possible scaling requirement of the future. That too is in a compatible (mostly negotiable) increment. Doing the same in-house is often costly.
To Conclude
Companies choose outsourcing to save costs and leverage professional experience at the same time. However, to save additional costs, the currency difference and cheap labor costs play a crucial role. Asia, Eastern Europe, Latin, and North America have been considered good destinations for outsourcing, so you can try finding a web development outsourcing company in those regions.
Rohit Bhateja is the director of the digital division of SunTec India, one of the leading website development company in India. He is a technology enthusiast who loves to write about trending technologies, transformative solutions, and the web and app development trends that are shaping the industry.
