As the digital world is evolving rapidly, the need for software development companies has risen to new heights as well. Businesses are in need of software development companies. With the demand for software companies, there is a new hot topic in the IT market and that is nearshore software development companies.  

Nearshore software development companies have gained popularity among businesses that demand high-quality projects to be delivered while compromising on the cost of development. A nearshore company has a better understanding of the needs and requirements of your business. Certainly, it is proven! 21% of startup businesses hire nearshore software development companies for their businesses, according to Clutch. The number of start-up businesses hiring nearshore software companies is predicted to rise, renowned businesses in America hire nearshore software development companies from Latin America for their talent and expertise in software development.      

What is Nearshore Software Development?

Nearshore software development companies are the firms that are located near your geographic premises. For instance, if your business is located in the United States, then your business can hire a nearshore software development company from Mexico. Hiring a nearshore software development company allows you to hire talent with minimal time difference and communication issues. This can be a significant advantage for hiring a nearshore software development company because the time difference will be between 2 to 3 hours. 

Furthermore, if you want to travel to your nearshore software solution provider, the traveling distance won’t be hectic at all. For instance, if you have hired a software development company from Eastern Europe and your business is in Ukraine, then you can travel to your software solutions provider within 2-hour and 34-minute flight. 

Renowned businesses like Google, Tesla, Porsche, IBM, and more hire nearshore software development companies for their software projects. Moreover, there is a wide range of startups that hire nearshore software development companies for the ultimate solutions of their business. 

How Do Nearshore Software Development Companies Work?

Nearshore software development companies are an organization that works closely with their clients located within a 3 to 4-hour time zone difference. Working on the same schedule can be very convenient for your business. The organization consists of a team of software engineers who are committed to delivering effective and innovative solutions for your software needs. The nearshore software development companies provide cutting-edge solutions while providing cost-efficiency. Hiring a nearshore software company can be beneficial in terms of cultural similarity with fast and effective communication. They also provide agile software development nearshore. They will work closely with your software squad while maintaining effective communication and time. 

Additionally. A wide number of international software companies are expanding their business to nearshore to keep their place in the market. According to Deloitte, 87% of IT businesses considered nearshore software companies to save the cost. Furthermore, Hatch states that the average rate of nearshore software companies is 46% lower than that of onshore companies. 

Reasons to Choose Nearshore Software Development Company

Hiring a nearshore software company can benefit you in various ways. Nearshore companies do not only come in with time management but also provide cost-effective solutions. By hiring a nearshore software development company, you grant your in-house team the flexibility to work closely with the nearshore team because of the smaller time zone difference. According to Zippia, nearly 59% of renowned businesses are pleased by the financial benefits provided by nearshore software companies.  

One of the most effective reasons to hire a nearshore software development company are:

Cost-Effective Development

If you ahve a fixed budget then hiring a nearshore software company is going to be the option for your business. One of the major reasons to hire a nearshore software development team is that they offer cost-effectiveness. 

Accessibility to your Team 

Hiring a nearshore software company benefits you with a smaller time zone difference. Your in-house team can seamlessly communicate with your nearshore team and together they will create cutting-edge solutions for your business. 

Quality Guarantee 

There is a pool of talent nearshore. If you hire a nearshore software company that means you have talent. You can guarantee that your project is in good hands. If there is any error in their work, you can seamlessly communicate with them and fix the bugs. 

Advantages Of Nearshore Software Development Companies

Nearshore software development outsourcing has become a very common practice among businesses. Aside from offering cost-effectiveness, there is a wide range of advantages provided by the nearshore software development company outsourcing. 

Reduced Travel Cost 

Traveling costs can be a major concern while working with other companies. However, nearshore software companies are going to benefit you in this. If you hire a software development company from nearshore, Argentina, and your business is in Brazil. Then, the travel cost will be approximately $193 one-way. You don’t have to travel to far countries just to visit your partner company.    

Similar Work Practices

Most of the nearshore companies offer agile and scrum methodologies for the software development process. Furthermore, hiring a nearshore software company will benefit you in similar work practices. In nearshore, a majority of the software companies provide the same methodologies.  For instance, if your firm is in Colombia and your nearshore business partner is in Brazil, then both firms work on the same software development methodology. 

Influence and Control  

Achieving enhanced management of your nearshore software team becomes attainable through shared directives, minimized time zone disparities, and a mutual language. The proximity of your partner fosters efficient collaboration and facilitates seamless communication. This proximity translates into improved oversight of your nearshore team, enabling more effective handling and coordination.

Disadvantages of Nearshore Software Development Companies 

Where nearshore software development companies provide advantages, there come numerous challenges as well. 

Long-term Commitment

Nearshore software development companies are hired for long-term projects. That means your project requires short-term commitment then if it is not an ideal choice to hire a nearshore software development company.  

Increased Labor Cost 

Nearshore offers cost-effective development. However, there are hidden costs they want you to pay after the development process. The labor cost can depend on the scope of your project. That means the cost can be increased while your project is in the middle of development. 

Limited Market 

Compared to offshore, the talent pool in the nearshore is typically limited. You might find it difficult to find the relevant candidates that match the requirements of your project. The set of skills and expertise might be harder to find on the nearshore than to find in the offshore. 

Difference Between Offshore vs. Nearshore

Offshore means hiring a development team from outside of your geometric promises, whereas onshore means hiring a development company from into your geometric premises. For instance, if you hire a development team from Latin America while your firm is in South America, then you have hired a nearshore software development company. Whereas, if your firm is in Brazil and you hire a development team from Hong Kong, then you have hired an offshore software development company. 

Offshore Software Development Company     

• Hire a software development company from outside your geometric premises. 
• Higher development cost.
• Access to the pool of talent.     
• Concerns about language barriers.   
• Different methodologies 
• Difficult communication. 

Nearshore Software Development Company  

• Hire a software development company from inside your geometric premises.
• Lower development cost.
• Access to a limited pool of talent. 
• No concerns about language barriers.
• Same methodologies.
• Easier to communicate. 

Top Examples of Nearshore Software Development

The nearshore trend is expanding widely. The most famous software applications we use are made through nearshore development services and we don’t even know. To know how successful the nearshore’s software development works, real-life examples are must know about. 

Inditex

Inditex is one of the most famous fashion brands under Zara. According to sources, Zara gave its 10% development process to nearshore software development companies. Those nearshore companies are Turkey and Morocco. 

Whirlpool

After Zara, the American multinational manufacturer nearshore its operation to Mexico. The nearshore development was about 80% from this firm. After Whirlpool, other electronic companies have also driven towards nearshore software development services 

Boeing

Boeing is an American aerospace company. This firm has outsourced its software development to the French multinational company Safran. Sfarn looks after the software development of Boeing in about 95%. 

Toyota Motors 

Toyota Motors is a Japanese firm. In 1996, Toyota outsourced its development processes to Thailand. After Toyota, Honda and Mitsubishi also nearsored Thailand for its development processes. 

Nearshore Software Development FAQs

Q: How long does it take to hire a nearshore software development company? 

A: The timeframes have a significant impact on the development time. You will have to go through several critical steps to look for the relevant nearshore software development company. Initially, you will have to look for nearshore companies, then list down a few you want to hire. Then the hiring process might take some time for you to choose the final company.    

Q: What should I consider before hiring a nearshore software development company? 

A: The major aspect you should consider before hiring a nearshore software development company is to note down your business requirements. You should find the relevant company according to your business needs and for that, you will have to know your company. Secondly, consider if your business needs a nearshore or offshore company. Maybe your business needs an onshore software company. Therefore, it is essential to know your needs. 

Q: Why is nearshore better than offshore?

A: Nearshore and Offshore have a lot that differentiates them. Both nearshore and offshore have advantages and disadvantages. Nearshore provides smaller time zone differences, less communication gap, potential control, and kore. On the other hand, offshore is the opposite. However, which one is better, depends on the needs and requirements of your project.   

Q: What are the reasons for nearshoring?

A: There are a wide range of reasons for nearshoring. The significant reason to hire a Nearshore software development team is that they provide a reduction of the overall cost. Furthermore, there is less communication gap. You can effectively collaborate with your nearshore partner whenever you want. The smaller time zone difference is also a reason to hire a nearshore software development company.   

Q: What is the difference between nearshore, offshore, and onshore?

A: Nearshore is a company that is located in your geometric premises. Offshore is a company that is located outside of your geometric premises. Onshore is a company that is located inside your country.