Skip to content

The Hidden Costs of Going Offshore for App Development

By: Dave Mastrella
Published: Wednesday, 02 December 2020

App development is one of the most potentially-lucrative endeavors that a business can pursue. In fact, groundbreaking apps have the potential to drastically reshape entire industries (or even the world).

It's not always possible to develop apps in-house, and many business owners decide to outsource this process. Outsourcing to offshore app development partners can be very appealing when comparing development cost estimates with U.S. providers. In fact budget estimates from off-shore providers may come in at less than half! Why wouldn't you consider them?

The truth is, initial budget estimates do not tell the whole story. There's a number of potential risks and hidden costs that you may not be aware of that could end up costing you much more in the long run.

Here are a few relevant factors to keep in mind when it comes to the true cost of app development from offshore development partners.

1. Legality Issues

As you may expect, outsourcing your app development to an offshore developer may cause you to run into legal issues during the process. This will highly depend on a variety of circumstances, though, such as whether or not the United States has trade restrictions with that specific country.

Other legal complications can arise if unexpected personnel changes occur. More specifically, if the lead developer quits or is no longer able to continue working on the project, you may find yourself in a situation where you are battling for the rights to your intellectual property.

Local laws in the country where your outsourced developers reside could also influence what type of work they can and cannot complete. 

2. Subpar Results

You'll be placing the responsibility of quality control entirely in the hands of your outsourced team. While this doesn't always guarantee that you won't receive the results you want, different areas of the world may have different standards when it comes to quality.

If there's a strong difference between your standards and theirs, this could easily lead to a handful of frustrating complications. This could even result in having a conflict with the developer, as the work they present may not be completely aligned with their own quality control standards.

3. Communication Difficulties

More often than not, outsourcing app development will force you to navigate time zone differences. It's also probable that you'll need to accommodate language barrier difficulties, as well.

Slow or subpar communication will only serve to increase the turnaround time of your project and decrease the quality of your final results. For businesses that don't have a large amount of capital to accommodate any shortcomings, incidents that involve missing deadlines or quality standards can be potentially impossible to recover from and a risk to your or your company's reputation.

4. Traveling Expenses

It's not uncommon for entrepreneurs to prefer to schedule various on site visits to the offshore facility while the project is ongoing. This provides them with a firsthand look into their development process, where they are along the project's timeline, etc.

It also gives them a chance to communicate with their developers face-to-face in order to clarify any gray areas or resolve any outstanding issues. Unfortunately, frequently traveling to foreign regions can quickly become expensive.

You may experience even further complications due to COVID-19 restrictions.

This is especially true the further that you go and the longer they stay. For example, an entrepreneur based in Denver, Colorado will likely spend tens of thousands of dollars throughout the year on various trips to their Vietnamese software development company.

The same can be said when it comes to flying your software developers to your location, which is an alternative option for those who wish to remain in their home country. 

5. Problems With Infrastructure 

Within the United States, IT infrastructure is upgraded at a notably quick pace. In fact, some firms may even purchase new equipment and software multiple times per year. It's important to keep in mind that this fact isn't always true in other countries.

It's not uncommon for offshore development firms to use outdated hardware and software. Not only will this impact their overall efficiency, but it could also pose a security risk.

Hackers frequently prey upon businesses that use outdated software due to the security flaws they can abuse. A data breach in this scenario will drastically impact your project timeline and also put you at risk of having your intellectual property compromised. 

6. Proper Documentation

Unlike working with a local developer, outsourcing your app development has additional requirements to get the results that you intend. You need to provide your software developer with as much documentation as possible so that they fully understand your needs.

As you may expect, this means that you'll have to spend extra time and resources in order to consolidate the appropriate amount of documentation, Something that could prove to be a significant financial setback.

This becomes increasingly difficult for software developers that are inexperienced or difficult to communicate with. 

7. Increased Project Management Obligations

Depending on the size of your project, the costs associated with your project management obligations can quickly become overwhelming. This is especially true for entrepreneurs who run smaller companies.

Typical responsibilities include contract negotiating, drafting and issuing requests for proposals, etc. In some cases, you may even need to hire a full-time project manager to ensure that everything goes smoothly.

Additionally, it's also essential to consider the time you spend searching for and vetting potential candidates. Since hiring the wrong project manager could easily result in significant complications in the future, it's imperative that you make the right decision from the beginning.

As you can see, the true cost of app development is often different than you expect.  

Under certain scenarios, it may work out just fine, however, we have heard many first-hand stories from companies with regrets after going the off-shore route. It's therefore important to understand all of the potential risks and rewards in order to make the decision that's best for your particular circumstance. 

As a trusted software development provider with more than 22 years in business, we are happy to consult with you to help  you weigh your options. Feel free to reach out to us today and see how we can help.

Tagged as: Development Costs, Offshoring

Dave Mastrella

About the Author:

Dave Mastrella

As co-owner of custom software development company, Envative, David has been immersed in Internet based application design & development for the past 30 years – with total development experience exceeding 30 years.

He has held positions ranging from senior developer, systems manager, IT manager and technical consultant for a range of businesses across the country. David’s strength comes from a deep knowledge of technologies, design, project management skills and his aptitude for applying logical solutions to complex issues.