Custom software vendors: local vs off-shore
You’ve got a lot of options if you’re looking to build custom software; it’s portable, independent of supply chains, and deliverables can travel at the speed of light.
That’s not to say custom software isn’t immensely valuable- it powers the world. But you should be able to enjoy the economic implications of having options.
We hope this guide puts the choice in context.
The small details vary, but all custom software vendors basically do a subset of this:
- Help you identify a technical solution to a problem of yours.
- Write a project blueprint within your requirements.
- Manage the project.
- Build to spec, possibly iterating on your feedback.
- Help deploy your code to infrastructure (i.e. AWS or a cloud provider).
- Train your team on the software and assist with relevant processes.
- Maintain and monitor the live application.
Staying on top of your deadlines!
We divide software development companies into three classes:
- Local custom software vendors
- Onshore custom software vendors
- Offshore custom software vendors
Let’s take a look at the pros and cons of each type.
Local custom software providers
If you meet a provider in person, even infrequently, then consider it a local software development engagement. Typically that means being in the same city, though some teams travel to meet-up (perhaps pushing the boundaries of this definition).
For example, K-Optional Software is a New York City local custom software company with a presence in Chicago, IL and Austin, TX.
While you limit your options to those nearby, you will find certain benefits from local vendors.
Advantages of local custom software vendors
Reputation and the trust factor
A vendor seriously stakes their name to a local engagement. You probably won’t find out about a failed project from a firm’s website, but your network can reveal all. On the other side of the coin, a good testimonial from a mutual connection is worth its weight in gold.
On a related note, bad actors seldom show their faces in person. Think back to last time someone tried to scam you- was it face-to-face or by text / email?
How frequently will your contacts change? “Churn” can affect the success of a project, as new faces spend time absorbing context (and sometimes billing you to do so).
It’s worth noting that churn happens more often on off-shore engagements. An overseas software development firm who hires contractors can’t promise the same consistency as a local business with salaried employees.
Custom build-outs iterate between two stages:
- Close coordination
- “Heads down work”
“Heads down work” remains mostly unaffected by the distance in the relationship. But coordination improves remarkably in close quarters:
A shared timezone means more overlap in work hours.
- And that means everyone can be online at the same time for a big launch.
No language barrier means no added friction.
A shared context really cuts overhead.
Perhaps these seem minor in isolation, but the effect compounds to a staggering degree- you can reduce coordination effort by a factor of 3 with a few of them. In turn, that speeds up the net project time by a meaningful percent. To visualize why, think of the collaboration mode like a red light. All else equal, if we wait at red lights a lot longer, then we end up with a slower, more frustrating drive.
As an example, K-Optional has worked with a local New York paper. Since having our HQ down the road, we haven’t needed to spend time answering questions about this niche market. That turned out to be quite relevant to the software product, so this has had a palpable effect on our chemistry.
Offshore custom software vendors
Advantages of offshore custom software vendors
With a wider net you can find lower rates. Just slowly zoom out on an AirBNB map and watch the low price fall. That’s thanks to the increased supply as well as the premium of being close to a city center.
Zoom out for lower prices
More of a coincidental advantage, if you seek to build a custom app that serves an international market, a diversity of opinion will likely help add perspective.
If you can make a commodity out of development, that’s a good thing for your business processes. They will have to be agnostic of your network and therefore might demand more robust processes. Put differently, if you can successfully tap an offshore team, it reflects well on your business. Just don’t put the cart before the horse.
Onshore custom software vendors
We’ll spare you the redundancy: onshore custom software vendors offer part of the local vendor advantage and part of the off-shore advantage.
All else equal, you will coordinate better with an on-shore team than an off-shore team, though not as well as with a local company.
- You’ll be within a few time-zones, worst case.
- You’ll probably speak the same language.
You might find better prices nationwide, though not so low as a worldwide.
Reputation matters— we recommend taking the opportunity to put a face with a name though.
If you were looking for a demolition squad or plumber you could only look locally. The global reality of custom software reduces costs to your advantage. Even so, trust and speed are usually great reasons to value proximity. Bear in mind the trade-offs when choosing your custom software vendor.