Why Hire a Nearshore Software Development Team?
โฆif you can get your own turnkey nearshore development center from scratch in 2 months with:ย
- Valley-grade team of 20+ senior developers in 3 monthsย ย
- Up to 40% cost savings compared to traditional outsourcersย ย
- Employer of Record service โ our compliant employment solutionย ย
- Zero buy-out costย ย
- No intermediary in team managementย ย
Mexico
Argentina
Colombia
Chile
Poland
Romania
Ukraine
BulgariaYour Own Up and Running Nearshore Software Development Team
Can a Nearshore Software Team Provider Guarantee You
2.5 years
average tenure of developers
Cultural alignment
with your company values
Pricing transparency
no hidden or buy-out fees
Legal & compliance
and other needed operational support
Exceptional dedication
itโs literally your own team
Long-term partnership
shared responsibility & commitmentKey Things About a Nearshore Software Development Team
Advantages
Engaging with an externalย nearshore development teammay be a profitable short-term solution due to:ย ย
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Operational functions are off your shoulders
Since yourย provider is responsible for tech hiring (if needed), employing, as well as handling payroll, accounting, equipment procurement, and other back-office functions, you wonโt need to do this yourself.ย ย
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Access to trained professionals
Providers ofย nearshore software development servicesย tend to already have an internal pool of pre-vetted engineers who are ready to join your team in mere weeks. But if your vendor lacks the needed software development experts, they will recruit them the traditional way.ย
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Employee management flexibility
If you have changes in your product requirements or business needs, your provider will rather quickly upsize or downsize a nearshore software development team. Plus, if you work with a reliable firm, they will provide you with a candidate replacement guarantee.ย
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Focus on core activities
Your in-house staff can focus on high-priority projects while aย nearshore software teamย can overtake less strategic tasks.ย
Challenges
But in the long run, this approach also poses significant risks:
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Buy-out fees
If you want to hire a member or a wholeย nearshore custom software development teamย full-time, youโll have to buy them out from your provider. Sometimes, this procedure entails stressful negotiations and ends with a hefty check that might reach up to hundreds of thousands of dollars for a team.ย ย
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Project-centric mindset
As such teams transition from one client’s project to another, they may struggle to adapt to your company’s processes. This can create tension with your in-house crew, potentially leading to delayed responses, missed deadlines, and lower-quality work
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No scaling opportunitiesย
When you hire a nearshore software development team, it poses a challenge in winning over investors. Delegating your core competencies to developers who will eventually leave your team could be viewed as a shaky foundation, wouldn’t you say?
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Data security concerns ย ย
Entrusting a nearshore software development company with your product development means sharing sensitive company data and potentially exposing your valuable intellectual property rights to risks. Without robust security measures in place, there is a heightened risk of data breaches, leaks, or unauthorized access.ย ย ย
Comparison with alternatives
Overall, dedicatedย nearshore software development teamsย are a good solution for temporary software projects. On the one hand, the client can control the development process and get a moderate teamโs dedication.ย ย
Hence, it surpasses the team augmentation model due to its higher dedication level. Additionally, team augmentation typically requires a pre-existing in-house engineering team to augment it. On the other hand, IT outsourcing is preferable for non-tech firms lacking internal engineering teams, with reduced client involvement compared to staff augmentation. Furthermore, neither solution offers significant benefits in terms of client control. Staff augmentation allows for partial client involvement, while IT outsourcing lacks it entirely. Similarly, managed services also lack client control but maintain a moderate level of team dedication.
Another alternative is a software R&D center, which is a software development branch of a product tech company in a beneficial location with a rich tech talent pool and lower labor costs. This solution offers full control over the development process, making it a safe option for long-term product development. With this approach, you can build your own software team consisting of people with a sense of ownership over your product and exceptional dedication to your company.ย ย ย
What is a nearshore software development center
A nearshore software R&D center is a fresh alternative to traditional team extension models, such as nearshore development teams. With this solution, you get your own software research and development center turnkey ready with a team from 0 to 100 skilled engineers within a year. What does it include at Alcor?ย ย ย
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IT recruitment ย
With a team of 40 experienced IT headhunters, we offer full-cycle IT recruiting services spanning 9 countries in Latin America and Eastern Europe to hire your dream engineers. We handle it all: starting with thorough sourcing and finishing with smooth onboarding of your developers. Within 2-6 weeks, we can find a perfect match for your team, ensuring top-notch quality as 98,6% of our candidates successfully pass the probation period.ย
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EoR supportย
If you hire with Alcor, you donโt need to establish your legal entity in a target location. Leave all the nitty-greedy tasks to our experts! Weโll take care of the employment of developers and compliance with all local laws, with payroll and tax management covered. You can rest assured while focusing on your core tasks, as in case of a fine because of our mistake, we provide 100% compensation.ย ย
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Full operational support ย
We go even further and offer a bunch of other additional services such as hardware procurement for your team, office lease, your employerโs brand promotion in the local market, visa support, and even more! Just choose what fits your business needs best.ย ย
Better than a nearshore third-party development team
Alcor is an all-in-one place to establish and run a turnkey software R&D center:
- Employer of Record support โ no need to set up your legal entity
- From 0 to 100 software developers in one key talent pool
- Establish your corporate culture with your own team. No intermediary
- No buy-out or other hidden fees
Nearshore Software Development vs Own R&D Center
Nearshore Software Team
- Huge buy-out fees If you want to keep your dedicated team in-house, expect additional hefty buy-out fees that will substantially raise your overall costs.
- Temporary fix External nearshore teams are loyal as long as the contract lasts and wonโt go the extra mile to ensure your productโs long-term success.
- Provider-centric teams The nearshore dedicated development team will report only to your vendor, treating you as the โsecondaryโ employer.
- Risk of data leakage If your provider doesnโt safeguard sensitive info, it could leak. Plus, you lose the unique expertise of dedicated engineers when the contract ends.
- Barrier to investment attraction Just like with IT outsourcing, IT outstaffing presupposes the delegation of your core competencies to developers who will eventually leave your team for good. Not exactly the investorโs dream.
R&D Center
- Maximized cost savings Your own software R&D team costs 40% less than working with a nearshore software outsourcing team. No buy-out fees & markups.
- Long-term commitment Product development and a sense of ownership attract professional developers in your nearshore development team as bees to honey. Hence, more loyalty.
- Your team, your rules You get your nearshore software team for ideation, innovation, and growth โ without intermediaries.
- Data security and IP rights under control With direct agreements, you fully own your productโs source code and IP rights, keeping unique engineering expertise in-house.
- Easy investment attraction After establishing your own R&D center, you will not only boost your software development capabilities but also become more attractive to investors.
Companies Scaling with Alcor
Alcor is a reliable partner that meets our hiring needs. We finally hired experienced software engineers in Eastern Europe with strong tech skills and business acumen. Account Managers are awesome!
With Alcor’s all-in-one solution, we got a software R&D office with 15 senior PHP devs and a compliant operational coverage. I really appreciated their transparent pricing structure and deep expertise.
We interviewed a lot of EoR platforms and companies, but Alcor was the only one that provides a combo package of EoR and Recruting offerings. Alcor helped us build a full stack team in 1.5 month.
We wanted to switch from our outsourcing provider, and Alcor has become really game-changing for us. Within a mere 6 months, we got a fully-fledged team of 30 engineers in our own R&D office.
Alcorโs R&D solution eclipses full-cycle recruitment, EOR service, and operational support for our offshore team. Their ‘all-in-one place’ approach is far more cost-effective than I could’ve imagined.
I value their commitment to going the extra mile. We evolved from an outstaff project into an independent company, and Alcor’s support was crucial. They hired and ondoarded 15+ professionals for us.
Thanks to Alcor, we hired four engineers and a designer that strengthened our team. Beside stellar recruitment, Alcor flawlessly handled our payroll. Their approach was seamless and swift.
FAQ
1) What are the top regions to nearshore development team services?ย
Latin America and Eastern Europe areย topย destinations for extending your development teams. Both regions host R&D centers of such tech sharks as Google, Microsoft, Amazon, Meta, and others. Together,ย LATAM and EEย boast a rich pool of IT talents amounting to over 3 million. Plus, both regions offer a more cost-efficient salary rateย thanย the US. Thus, on average, developers from Latin America earn $38,350 a year, while Eastern European engineers get $52,180. Thatโs a 2-3 times difference compared to their counterparts in the United States!ย
As for location, Latin American countries are easily accessible from major US cities, sharing the same time zone with most of them, which ensures smooth management of nearshore teams. On the other hand, Eastern Europe is just a 1-2 hour flight away from major European capitals like London, Berlin, and Paris. The time difference can also be advantageous, allowing businesses to benefit from an almost 24-hour workday (your in-house devs start work after your offshore coders are done with theirs). ย
No matter which region you choose for your business expansion, Alcor is here to assist you in swiftly and smoothly entering both IT markets. Just share your needs with us!ย
2) What are the top countries to nearshore development team services?ย
Countries like Mexico, Colombia, Argentina, and Chile have thriving tech ecosystems in LATAM, whereas Poland, Romania, Ukraine, and Bulgaria stand out as IT frontiers in Eastern Europe. These destinations are top choices among product tech companies looking to nearshore, each offering a rich talent pool with diverse tech stacks, moderate salary rates, and vibrant tech environments.ย
Unsure which country is the best fit for your tech business? Share your goals with Alcor, and weโll help you select the perfect destination!ย
3) How do you choose where to expand your tech business?ย
When choosing the ideal nearshoring destination for your tech business, key factors to consider include the size of the talent pool, local salary rates, and the overall business environment. In Latin America, Mexico stands out with a vibrant talent pool of around 700,000 software developers, followed by Colombia with 150,000, Argentina with 115,000, and Chile with 61,000. In Eastern Europe, Poland boastsย over 600,000 tech professionals, while Ukraine has 307,000 developers, Romania offers 202,000, and Bulgaria contributes over 100,000.ย
Regarding salary ranges, the average wage for LATAM developers spans from $35,400 to $42,360, while in Eastern Europe, salaries range from $45,000 to $59,000 per year.ย
The business environment in each country is unique, offering different opportunities for tech businesses, as well as varying tax rates and legal compliance requirements. The good news is that regardless of which country you choose for nearshoring, you donโt have to navigate these complexities alone. At Alcor, we help you select the best nearshoring destination based on your business needs and goals, hire the top 10% of talent in the market for your team, and navigate the peculiarities of each location, handling employment, payroll, tax management, legal compliance, and more. Contact us, and weโll see what we can do for you!ย
4) When is a business ready to use a software development center?ย
It all boils down to your business needs. For tech product companies, establishing a software research and development center with an in-house development team proves to be an ideal solution. This approach enables the retention of core operations such as product development and its testing, under direct control, ensures long-term commitment from engineers, and facilitates the attraction of investments. On the other hand, for businesses lacking internal expertise in software development, hiring a nearshore dedicated team would be a better fit. Yet, if you want to play the long game and potentially grow your business, choosing IT recruitment services is a great option to start with.ย