Why Nearshore Software Development can be an excellent solution to your business

10 min readJul 14, 2022
nearshore software development

Many businesses these days are turning to nearshore software development as a way to outsource their IT needs. It doesn’t come as surprise as a nearshore software development company can offer the same services as a local company — but at a fraction of the price.

This simply is a great solution for your business for many reasons, and we will talk about just a few of them here.

What is nearshore software development?

Let’s start with the basics — what nearshore software development is and why you should bother.

Nearshore software development is the outsourcing of software development tasks to a company located in a different country, but close enough to be considered “near” the original company.

Though there isn’t a definite mileage for how far away the two countries must be, it’s probably safe to assume that they are on the same continent.

nearshore software development


Nearshore software development can offer several advantages over traditional offshore outsourcing — and provide solutions to a number of issues and problems in today’s world.

While nearshore companies can present benefits in terms of quality or savings, they also can aid in local tech talent shortage.

UK tech talent shortage grows as staff plan early retirement, for example.

In Great Britain, companies have struggled to recruit good software teams for years, and the situation is exacerbated by their own local market. Nearshoring software development is one of the most popular — and effective — ways to address this issue, not only in the UK.

Benefits of nearshore software development

#1 Cost-effective solution for businesses of all sizes

When compared to traditional offshore outsourcing, nearshore software development is often much more cost-effective.

This is due to the lower overhead costs associated with nearshore companies and the shorter distances between countries.

However, lower costs don’t have to mean lower quality. Quite the opposite, actually.

Nearshore developers are often more skilled as their counterparts in more expensive locations, making them a great value for your money. HackerRank conducted a study in which certain locations were found to be phenomenal at developing.

nearshore software development

Look, for instance, at Poland — excelling in both Java and Algorithms (and many more, if you happen to check the whole HackerRank list).

Adding the talent pool to your native country’s hiring costs, you may discover the difference instantly.

Let’s say you run your business in Netherlands.

You need to pay roughly $70k a year for a software developer in your country.

By nearshoring it to Poland you can access amazingly skilled developers while saving money as software developers earn less than $40k per year.

nearshore software development

You do the math.

Several big players in the software industry have also adopted this practice.

Basecamp, for example, decided to outsource some of their internal software development work to other companies to free up some space for their developers. Developers could have thus focused on business core instead of solving bugs or designing low-priority features.

#2 Access to the skilled talent pool

This point has been made before, but it deserves to be reiterated.

Only in the first 9 programming domains, Poland ranks five times in top5.

nearshore software development

Many nearshore developers are skilled in multiple programming languages and platforms, making them a valuable resource for your business.

Due to the fact that they are “multilingual”, they can work effectively and accommodate your various needs as one company.

To complete one particular job, you don’t then need to hire new in-house specialists or look for several software companies — nearshore software development companies are often well versed in how to work within different programming languages.

#3 Straightforward management

The proximity, common time zone, and similar work culture of nearshore teams can make them easier to manage than teams located elsewhere. With communication tools like email, instant messaging, or video conferencing platforms, remote collaboration is not a problem anyway — but if it can be conducted in convenient time zones for both parties, that’s even more effective.

It goes without saying, too, that straightforward management is key to overall success of the process. If things go smoothly with collaboration, the end product may simply reflect that.

#4 More efficient collaboration

Nearshore developers are often experienced in working with various companies from all over the world, so they will easily adjust to your workflow. Many of them are fluent in languages (with English being on a nearly native level), making communication with them easy regardless of what language you or your team speaks. These people get things done as their DNA is agile.

This easy communication is one of the biggest benefits of nearshore software development. By being able to easily communicate with your developers, you can ensure that all project requirements are met and that any problems that may arise can be quickly resolved. This can lead to shorter turnaround times and reduced costs associated with project delays.

And that’s what software projects love the most.

How to find the right nearshore partner for your business

1. Consider the type of partner you need

Not all nearshore companies are created equal. Choosing a nearshore partner depends on the type of company you need. For example, if you’re looking for a software development partner with fintech expertise, you’ll need to look for a company that specializes in developing fintech software. Web development services may not be adequate if your project is mainly about developing a mobile app. The examples can be multiplied, and while you shouldn’t rule any potential business partner out too quickly, you should keep that in mind.

2. Evaluate your business needs and goals to find a good match

Evaluate your business requirements. Taking the time to find a nearshore development provider that aligns with your company’s specific wants and needs is crucial for success. Some factors to consider include:

  • Size of nearshore provider — is their size sufficient to handle your project?
  • Expertise in your specific industry — have they ever worked in your sector?
  • Language capabilities — can they easily communicate with you and your team?
  • Location and time zone similarities — do you need to rely on asynchronous communication, or day-to-day communication is “business as usual”?
  • Cultural fit — would they understand your values and requirements?

Ticking the above boxes helps you make sure that you’re partnering with a nearshore software development company that is not only qualified but also invested in helping your business succeed.

The cultural fit made Skype more successful. In 2003, the Skype founders (Swedes and Danes) commissioned Estonian programmers to develop the back-end for the platform, which we use today.

3. Ask for references from other companies that have partnered with this company in the past

A great way to get a sense of whether or not a nearshore software development company is right for you is to ask for references from other businesses that have partnered with them in the past.

This will give you an idea of the quality of work that they produce and how satisfied other companies have been with their services.

This step may be difficult to execute — in that case, you should move on to step 4.

4. Check out their online presence and testimonials

This step includes looking at their website, social media pages, and reading any testimonials from past clients. By doing this, you can get a feel for the company’s culture, values, and work ethic.

It’s also important to make sure that the nearshore software development company you choose has a good reputation. You can do this by reading online reviews and checking out independent rating websites such as Clutch — as this one comes across as a well-researched and reliable rank website.

How to check it in terms of nearshoring? It’s easy! Simply navigate to a nearshoring development partner’s Clutch profile, double-check where they are from, and look for reviews from companies located nearby.

The review below can be found on Scalac’s profile:

nearshore software development

We can consider this collaboration to be nearshoring since Scalac is based in Poland and Bexio AG is located in Switzerland.

5. Do a trial run — if possible, work with them on a small project before committing to anything long-term

Doing a trial run means working with them on a small project before committing to anything long-term. By doing this, you’ll be able to see firsthand how they work and if their methods and processes align with what you’re looking for.

Especially if it is your first try with nearshoring, you may want to try it first if it meets your requirements.

Tips for successfully launching a project with a nearshore team

1. Create a detailed project plan and timeline

This step wwill help both you and the team you’re working with understand what needs to be done and when, which can help avoid any misunderstandings or delays.

Including milestones and deliverables in your plan will also help ensure that everyone is on the same page and that you’re able to track progress along the way. If you’re not sure what all of your needs are yet, that’s okay — just make sure to communicate this to the nearshore software development company you’re working with so they can help you figure it out.

In this step, you need to decide if you want to implement nearshoring. In some cases, offshoring could be a better idea, but it’s all down to individual choice. We have a complex comparison on outsourcing, offshoring and nearshoring on our blog.

2. Be flexible when it comes to deadlines, but don’t let them slip too far or you’ll lose control of the project

While it’s important to be flexible when it comes to deadlines, you also need to make sure that you don’t stray too far from them. If deadlines start slipping too much, you’ll lose control of the project and could end up with a product that doesn’t meet your expectations.

It’s crucial to find a balance between being flexible and staying on track so that you’re happy not only with the end result but also with the ongoing collaboration and communication.

3. Give clear instructions and be open to feedback on how they can do their job better

When working with a nearshore software development team, it’s important to give clear instructions and be open to feedback. This will help them do their job better and ensure that you’re happy with the end result.

It’s also important to remember that they are not mind readers, so if there is something you want to be changed or improved, let them know. Since agile teams can still adjust their workflow to these changes, it is better to communicate some modifications upfront. You may not be able to implement changes if you communicate them too late, or you may incur high costs.

5. Stay organized by using tools for different aspects of the project (e-mail, tasks, etc.)

Use tools to keep track of what’s been done, what still needs to be done, and who is responsible for each task.

Some popular tools include e-mail, tasks, collaboration software, and document management tools. Furthermore, nearshore software development companies often use a task management tool, such as Asana or Trello, to help manage tasks and communicate with their clients.

You can either recommend the tools you use on a daily basis, accept the recommendations of the nearshoring development partners, or work together on the solution that works best for both parties. Communication is key — but wrong tools can jeopardize it.

The future of nearshore software development

Nearshore software development provides companies with the benefits of outsourcing without having to sacrifice quality or control. By locating development teams closer to home, companies can reduce communication and coordination costs while maintaining a high degree of oversight.

This proximity allows for easy collaboration on many platforms. Nearshore developers are familiar with your culture and business practices, which can lead to a smoother workflow and fewer misunderstandings.

Additionally, nearshore development teams are often more skilled in specific technologies and industries than their offshore or local counterparts, which allows companies to target their projects more narrowly and achieve better results. Ultimately, nearshore software development presents an attractive option for companies looking to outsource software development without sacrificing quality or control.

The future of nearshore software development is very promising.

Nearshore software development offers many advantages over offshore software development and will continue to grow in popularity in the years to come, as businesses increasingly recognize the benefits it offers. In order to stay competitive, businesses must find ways to reduce costs while still maintaining high-quality standards.

Nearshore software development provides benefits for both onshore and offshore development while mitigating some of the drawbacks of each. What’s not to like?

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Scalac is a web & software development company with 122 people including Backend, Frontend, DevOps, Machine Learning, Data Engineers, QA’s and UX/UI designers