How to Sell Outsourcing Services
It is a regular practice for the companies engaged in software development to avoid messing in the donkey work related to the separate parts of a software product. The staff members are usually top-quality experts who are not willing to deal with menial tasks. Therefore, the management of the development companies opts for the outsourcing services.
Sometimes companies that develop software products may not have employed developers, testers or other relevant specialists. It performs the creation of the requirements and the initial ideas that later will be sent to third-party companies known as the providers of outsourcing services. These providers may be located in another country or even on another continent. They receive the orders to make a code, testing, compilation and other corresponding tasks namely sell outsourcing services.
In the following article, a detailed review of various questions related to selling outsourced services is introduced. If you're a part of a young and ambitious team of outsourcing developers, you might find it beneficial for the promotion of your services.
Table of contents
- Types of Outsourcing Services
- Costs of Outsourcing Services
- How Much You Can Earn
- Benefits of Outsourcing Services
- Disadvantages of Outsourcing Services
- Key Points Considered by a Customer When Selecting the Outsourcing Services
- How to Persuade a Customer?
- Where and How to Find a Quality Provider of Outsourcing Services?
- What is a Proper Way to Connect a Developer with a Customer?
- Where to Find a Customer for the Outsourcing Services?
1. Types of Outsourcing Services
There are many ways to classify outsourcing services. The most logical way of such classification is based on the location. It means that you can use the local, nearshore, and offshore services for the software development. The local type refers to the software companies or teams within your country; the nearshore type covers the adjacent or neighboring countries and the offshore type includes the locations far from your place namely other continents.
Another classification is based on the very services. It relies on the specific product to be developed and can include SEO, mobile app development, web design, e-commerce, testing services, etc. Today, the most popular outsourced software development includes application development, integration of a system or a database management.
2. Costs of Outsourcing Services
In fact, one of the reasons why such term “outsourcing” came out is an attempt to reduce costs. It started in the late 1990s when large companies decided to cut a payroll and optimize their performance. Currently, the cost-effectiveness of the use of the outsourcing services is also high. For example, the rate for selling outsourcing services from Asia or Eastern Europe is almost three times lower than of its US competitor. So, the first factor influencing the cost is the location.
The second cost-regulating factor deals with the type of work to be outsourced. Naturally, the more complicated a task is the higher the rate. The cost of the developer and tester services will differ because of the various types of activities.
3. How Much You Can Earn
As it was mentioned before, the rate to sell outsourcing depends on the complexity and kind of task. Besides, the cost of your services will vary depending on your location. Let’s check an example.
A qualified software developer from the North America earns around $100 per hour. This rate may vary in accordance with the skills and reputation of a certain specialist. If you come from Asia and can boast of high skills in software development, you can sell outsourcing services for not more than $40. The lowest wages are in India where a developer earns around $20. Specialists from Malaysia, Vietnam, and China are highly prized and sell outsourcing for $30-40 per hour. The same rate is applied to the outsourcing developers coming from Latin America. Contrary to a popular belief that the outsourcing services in Africa are rather cheap and do not exceed $20 per hour, such countries as SAR and Nigeria can boast of rather qualitative and highly prized software specialists earning around $40.
The most attractive region for the outsourcing services at the moment is represented by the Easter European countries including Russia, Belarus, and Ukraine. Rates vary from $25 to $40 based on the numerous factors but the fact is that the level of quality and services provided is rather high. The labor of the other outsourcing vendors of the European area like Poland, Czech Republic, Slovakia and others are at a similar level.
4. Benefits of Outsourcing Services
In the past years, a great number of software companies took advantage of the software development outsourcing. The reduction of costs is named as the main reason for this trend. Nevertheless, the advantages of the software outsourcing relate to not only the monetary terms. In addition to saving money on the labor and taxes, the outsourced work or parts of a project allow a company to concentrate on the principal activities and to deploy all the available resources to the priority tasks.
Another benefit is the quality of specialists. You should not brush aside a possibility of some really talented human resources that can be found during outsourcing. Besides, a fruitful cooperation on a certain project can result in closer business relationships between an outsourcing company and a highly skilled specialist.
If you pay more, it does not mean that you obtain a better quality. Therefore, the outsourcing can be a way to create a better quality product. In addition, the cooperation with the offshore software teams increases the productivity due to the different time zones. The work on the project is performed twenty-four-hour. For example, a part of a project is outsourced to the development group in Asia. On the morrow of a business day, the results are given to the development team located on the other side of a globe. Such an uninterrupted process distributed among the outsourcing vendors boosts the performance by times.
5. Disadvantages of Outsourcing Services
In spite of the benefits listed above, this type of services holds numerous risk that can lead to failure.
The first point to be reviewed is a possibility of miscommunication. The international language of communication is English. Nevertheless, the peculiarities of this language on a particular part of the globe should be considered. It means that some terms or vocabulary may be misinterpreted resulting in adverse consequences. I would add a cultural mismatch hereto.
The other issue is suboutsourcing. Do not seek for this term on the web because I have just invented it. It means that the teams, which have received the outsourced task, start outsourcing it to another team or group of developers. Their revenue comes from the margin between the cost received as a subcontractor and paid as a customer. For example, a customer outsources a task at a rate of $100 to the developers selling outsourced services in Ukraine, which in turn suboutsource it to the Chinese developers for $50. As a result, $50 for almost no efforts. Unfortunately, the quality is what suffers most of all.
Another disadvantage, which is considered the main concern for an outsourcing company is intellectual property. Some dishonest offshore development teams can steal the developed product and use it to their advantage. For this reason, some companies make a practice of outsourcing different parts of a project to the developers located in different parts of the world.
6. Key Points Considered by a Customer When Selecting the Outsourcing Services
It is highly advised not to focus narrowly on the cost-effectiveness of the outsourcing services but also consider the other aspects to avoid a negative outcome. An experienced provider of services will never give an instant approval of your offer because, in spite of the attractiveness of a project’s price, the following requirements are essential: an availability of resources (human resources, appropriate software, hardware, etc.), an appropriate business area, and a set of knowledge.
The major attractive feature of any developer is the references or best practices. No regalia are as important as a practical experience confirmed by a well-known customer.
It should be mentioned that some customers are very demanding to the work conditions and compliance with the local labor code.
It is easier to attract a customer when a task does not require a creativity or an extraordinary approach. Otherwise, a customer will be interested in your view of a project. In this case, nobody can predict whether your opinion is in line with the customer’s idea.
In addition to the regular requirements, you may face some unpredictable and in some way bizarre requirements but you should realize whether they deserve your efforts.
7. How to Persuade a Customer?
Almost everyone remembers the scene from a famous movie when the main character is proposed to sell a pen. Our situation is similar to some extent but instead of the pen, we have the outsourcing services. To become attractive for a customer means to achieve a harmony in all the required aspects namely price, skills, experience, references, working conditions, number and quality of the team members, etc.
However, if a customer hesitates, you need figuratively to push him or her. The best way to do this is to make an exclusive offer to stand out amid the competitors. Lay bare all your advantages and turn the scales to your side.
8. Where and How to Find a Quality Provider of Outsourcing Services?
Your search for an outsourcing services provider should start with the evaluation of the key emphases of the entire project. I mean the foundation of your search. If you need cheap and fast, you may find numerous options in the Asia or Africa. If you require a more sustainable approach, pay your attention to the South and North America. Nevertheless, the best quality-price ratio is observed within the European part of the globe.
At the same time, all these geographical clichés must not be comprehended as the strict rules. You may find a top class development teams both in Asian and African countries, as well as get a low-quality result produced by a team from the USA.
Anyhow, if you've decided to outsource a work to another country, it is advised to make a visit to this destination in order to analyze the work conditions and other peculiarities. This is almost a prerequisite if you are going to have a long-term outsourcing relationship with a team of developers from abroad.
9. What is a Proper Way to Connect a Developer with a Customer?
At a first glance, there is nothing to be concerned about in this case. However, the largest share of developers are the extraordinary people, the creators, who have an unusual comprehension of many things. Besides, they hate distracting talking.
To achieve the highest performance it is better to get a perfect understanding between a customer and a developer. For this reason, a developer should be motivated or encouraged to be kind or polite to the customer’s requirements. A bonus or some additional privilege can be a convincing factor in any difficult situation.
Nevertheless, if you are a manager or a team leader, it is advised not to skip a conversation between a developer and a customer and to be in touch with the situation.
10. Where to Find a Customer for the Outsourcing Services?
You can make a publication in a local newspaper. It is not more than a joke. And now seriously. In the great spaces of the web, you may stumble upon numerous marketplaces to promote your outsourcing services. They are also known as the freelance platforms or networks.
To make a simple description of the most popular ones will take a lot of space and time. All of them offer various opportunities to advertise yourself or your services and get the sweetest customer. If you are too busy to search, here are some from the top: Guru, Fiverr, Scalable Path, Freelancer, Upwork, Elance, and many others.
Being a skillful developer does not mean to be a sought-after specialist. A skill to sell your services is essential to get success in the outsourcing activities. I hope that the information and advice above will be useful and help in attracting customers for your prospects.