Outsourcing has provided a way for founders and entrepreneurs to find international top tech talent at a considerable discount to create their companies or enhance their existing team.

What is outsourcing?

Put in simple words, outsourcing is the practice of obtaining goods and services from a foreign supplier. This is most commonly used in industries to help the team, it greatly aids in boosting business. For example, software developers or designers.

Outsourcing can be used for any position whatsoever, but today we see companies using it for non-fundamental roles, those whose function is to provide support to the central infrastructure of the company or aid in the day-to-day operations of the company.

With the rise of the technology sector and the startup ecosystem, outsourcing has become a window of opportunity for companies to acquire and retain development talent and teams as the supply of developers is not enough to meet the demand.

Why do companies outsource ?

In its simplest form, companies outsource because it reduces their overhead to produce a product, thus increasing their profit margins. It’s a purely a business decision.

We live in a world where the same amount of work done in one country or city is not equally paid as if it were done elsewhere. It can be argued that the discrepancies in pay levels come from state and federal taxes, the country’s economic standpoint (measured in GDP per capita) and wage-setting institutions.Regardless, the basis of the decision is an economic one.

Here is a thorough breakdown of the reasons as to why people outsource:

Reduce or control costs
52%
Gain access to IT resources unavailable internally
53%
Free up internal resources
60%
Improve business or customer focus
59%
Accelerate company reorganization/transformation
55%
Accelerate project
51%
Gain access to management expertise unavailable internally
57%
Reduce time to market
60%

Companies that outsource technology quickly learn that these remote developers and tech professionals are results-oriented and rely heavily on milestones and deliverables.

In conclusion, outsourcing can be a very helpful strategy for a company’s profit margins and for productivity purposes.

1) Cost saving
2) Efficiency
3) Greater competitive advantage
The three main advantages of outsourcing

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