Everyone knows why nearshore solutions have become so extremely popular during the last few years: Because nearshore development is actually an accessible option when it comes to looking for IT outsourcing services.
The bad side of this increase popularity in the nearshore sector, is the fact that many questionable nearshore companies have taken advantage of this, offering very “cheap” nearshore solutions that are not what they seem at all.
It makes perfect sense that this particular type of scam is happening when you look at the main reason why companies are choosing to outsource in the first place: To cut costs and reduce expenses.
But why, why is exactly this happening now? Why are so many people falling for such an old scam and getting horrible results in return? Today, we’ll take a look at this strange phenomenon happening on the IT outsourcing world, how to spot it, and the major consequences of working with a nearshore company just judging by the low price.
To understand why these scams are happening, we need to take a look at the main reason why people even choose to outsource in the first place: To reduce expenses and get a software solution without having to pay a fortune.
Now, we have several blogs about this topic which you can check out here and here. Blogs that talk about how nearshore isn’t really cheap, but rather accessible. Yes, it can be a great way to cut down costs, but it won’t be necessarily “cheap” if that is what you’re actually looking for.
However, with over 59% of companies admitting the main reason they outsource their software development is to cut costs, this according to Deloitte’s 2016 Global Outsourcing Survey, it’s common companies use this method to attract potential clients.
All these factors help creating an environment where companies end up working with a nearshore outsourcing partner that can’t really complete the task given or deliver a good software solution as required.
This leaves you, the company, with a poor-executed project, a software solution that doesn’t really work, and a bitter feeling towards outsourcing in general… All due to the fact you choose a nearshore development partner based solely on the price of the whole project.
Now, what can you do to avoid this happening to you? Well, there are two main things, one, is learning to identify these types of scams and two, is being aware of how much does a IT outsourcing service actually costs.
Believe it or not, this is something that has been happening quite a lot, specially in the offshore sector, where companies (majorly from India) catch the public’s attention by claiming they can do a great software development process for a very low price.
However, this is not only happening in the offshore sector, but now on the nearshore as well. So, if you don’t want this happening to YOU, pain attention to these three red flags:
The very first thing you’ll notice about these types of nearshore companies is how they are always and constantly advertising their low prices. Words like “Free” and “cheap” are used excessively.
There’s also the fact their call to actions or whole marketing strategy revolves around offering an accessible service. They don’t showcase their precious works, their team or their experience, but only talk about their low prices and promotions.
This goes hand-to-hand with the previous point. If the nearshore development partner you are thinking to work with can’t prove their experience in any reliable way, it is time for you to run away.
It is extremely important that the people providing you with nearshore solutions is able to actually prove they have the experience to carry on with such a heavy project like developing a software solution.
They must be able to provide you with a background of who they are, how they work, their work ethic, and of course, show you different projects they have been involved previously and were able to handle perfectly.
Last, but definitely not least, a company offering nearshore solutions should have a great online platform to backup their services and actually showcase everything they can do.
Do not trust nearshore companies that don’t have a well put together website that works a living proof of who they are, what they do, and how they work. Trust us, doing that is simply a bad idea.
Like we said, it is not enough to learn how to identify these types of companies, you must also be aware of much software development really costs in order to identify when a offer is just too good to be true.
We have a complete blog that walks you through how much software development really costs, the various type of prices you can find, and why these solutions costs what they cost, you can read it here.
Now, signing a number to such a complicated process isn’t really realistic if you don’t know the scope of the project, what the client wants, the type of IT outsourcing services they’re looking for and such.
But just to give you and idea, a software solution can cost anywhere from $10.000 up to $100.000, depending on what you want, when you want it, and the many different specifications that might come with the task.
The point whe are trying to make here is that nearshore solutions cost money. Implementing all the different technologies that go behind those solutions, getting all the right permissions, the hardware needed to create the coding behind those solutions and the time invested, everything costs money.
Going for a cheap alternative might be tempting, but when you realize you could waste your money AND time just to “save” a couple of dollars, you’ll realize it’s simply better to hire an actual, capable, professional nearshore company, than just going for the “cheap” option.