A Complete Guide to Nearshore Software Development

NEXT IDEA TECH A Leader in Nearshore Software Development Services
NEXT IDEA TECH A Leader in Nearshore Software Development Services

Are you in the business of developing software? If so, you might have noticed that it’s becoming more expensive to attract and retain experienced software developers locally. It might also have dawned on you that the rapid evolution of technology requires companies to stay up to speed with the latest innovations which can be challenging. The skillsets you need today may change in a matter of months and building the right skills in IT teams is a lengthy and costly process.

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The good news is you don’t need to commit to scaling your team internally to stay ahead. Our complete nearshore software development guide can help you overcome these staffing challenges. Whether you’re looking to build a new product, revamp an existing app, or increase your client base, our guide can help you ramp up your team through nearshoring and stay ahead in the game.

Find out what nearshoring is, and take inspiration on how you can best overcome your IT staffing shortcomings by using the services of a nearshoring partner just like Next Idea Tech to instantly support tech initiatives in an ideal and cost-effective solution.

What is Nearshoring?

Nearshoring is a business term that we use when delegating or outsourcing certain IT tasks abroad to an adjacent country. It is the practice of hiring developers outside your company for a task that used to or could be performed by a person within your organization. Nearshoring allows companies to delegate some tasks, or even entire projects, abroad to entities outside your company. For example, perhaps you used to have a full-time DBA as an employee but nowadays you outsource those services to a software nearshoring partner/vendor. A nearshoring partner/vendor in this case is a team of IT experts who help you run your business and keep your digital products alive.

Benefits of Nearshore Software Development

There are a bunch of benefits that you can get by building a nearshore software development team through nearshoring, as we will see in this comprehensive nearshore software development guide.

#1: Geographical Proximity

When it comes to software development, geographical proximity is a huge plus as travel times and costs are much lower compared to traveling to offshore locations. Contracting a team from Asia, for example, provides precious few opportunities to physically meet the team. Whether you’re looking to visit a development team or have them fly into your office in the US, nearshore destinations will provide easy access and quick travel frames.

#2: Time Zone Similarity

Perhaps the biggest advantage of the nearshore IT outsourcing model, when compared to overseas vendors, is the time zone difference. Successful agile software development projects are predicated on efficient communication between teams. As such, real-time communication between teams in similar time zones provides the ideal environment for successful projects. Nearshoring makes it possible for your on-site and remote IT teams to share similar time zones and overlap throughout their workdays. Most nearshore countries only have a one-hour time difference with the US and Canada, the maximum being a four-hour time zone difference. This can alleviate many of the problems often encountered when outsourcing IT projects. Having similar working hours also allows for real-time video meetings which help teams integrate and communicate more effectively.

#3: Cultural Affinity & Language Fluency

Countries in Latin America share the western cultural values of the United States, as most of the population have been following US pop culture and events since childhood. Whether it’s through sports, music, film, or even late-night shows, Latin Americans are regular consumers of US culture. Moreover, it has been proven that there are several areas where cultural similarities between nearshore developers and onshore clients can support cooperation in areas of business values, punctuality, time management, reliability, work ethics, risk aversion, as well as willingness to take responsibility for their actions. Another huge plus is that Latin America’s software development workforce has a good level of English language Fluency as it tends to be a requisite for most high-paying jobs.

#4: Skilled Workforce

Talent shortage in the US market is one of the main reasons why companies seek to grow their teams by hiring offshore and nearshore developers. There is a huge talent pool of highly skilled software developers that can be tapped using either model, but the nearshore model provides the added benefit of proximity and time zone similarity. Universities in Latin America have also been successful in responding to the growing demand for IT professionals and governments continue to enact policies that foster the evolution of the region’s IT workforce.

#5: Lower Total Cost of Engagement

When comparing the cost of hiring nearshore developers with that of hiring an on-site developer, many people only factor in the basic salary and forget additional costs such as office space, software cost, computers, pensions, and state taxes, not to mention any employee benefits you offer. Once all this is factored in, the price advantage of hiring nearshore developers only becomes clearer. Countries like Mexico, Panama, and Uruguay are listed as some of the most affordable countries to outsource software development projects with a profitable balance of rates and solutions quality. As a direct result of all the previous benefits, the overall cost of nearshore development proves to be lower than the on-site alternative.

#6: Better Scalability

When hiring nearshore developers you pay for the services you need as you go without paying for regular maintenance and support that you would otherwise need with on-site staff. If necessary, you can always increase or reduce the size of the dev team with minimal difficulty. Also in the case of nearshore development teams, there is no need to dedicate time to allow newly assembled teams time to get to know each other and establish comfortable conditions of cooperation within the team. The close-knit team units are acquainted with each other already, so they will be ready to work at their top efficiency once hired.

#7: Better Management Opportunities

It’s a lot easier to manage a software development team working in the same building. However, nearshoring provides a middle ground between having total control over the dev team and the complete absence of control. By hiring nearshore software developers, the contractor can remain a real manager as opposed to being relegated to the role of a random client who lives on the other side of the globe. Furthermore, there are diverse approaches at your disposal: you can be a manager who stays in touch with the team or a manager who chooses to visit the team personally.

What Problems can Nearshoring Solve?

#1: Lack of Experienced Developers

Despite having an excellent in-house IT team, the team may still lack a couple of highly specialized employees. In that case, hiring a couple of people nearshore who have the specific skills required to fill the gap and finish the project

is a simple solution.

#2: Implementing a New Technology Stack

Nearshoring is a preferable option for hiring outside talent that would bring all the necessary skills required to implement a new technology stack when the in-house team lacks professionals with the requisite expertise.

#3: Slow Time to Market

Once you’re ready to outsource software development nearshore, one of the significant benefits of this process is that the team can start working on the project immediately. With a project management plan ready, the team can accomplish the first sprint in less than two weeks from day one.

#4: Tight budget

IT nearshoring is an effective way to cut expenses. Businesses looking to cut operating costs are increasingly pursuing nearshoring as a sound strategy that leverages the benefits of a globalized economy. Nearshoring IT services allows US businesses to mitigate capacity issues and focus financial and capital resources on more profitable activity.

Businesses that can Gain the Most from Nearshoring Software Development Services

#1: Startup MVPs

The main objective of an MVP is to gain feedback from users and analyze it to make product changes if necessary. The MVP should be released quickly and efficiently. By outsourcing some or all of the work, you can significantly reduce your time-to-market and save money on hiring staff.

#2: Startups at Pre-seed and Seed Rounds

If you’ve already tested your MVP and are looking to raise money for further development, you should seek a software development company to scale your idea. Nearshoring helps you to find developers for your startup, giving you immediate access to a massive talent pool with low employee costs. This enables flexibility in the technology stack used instead of settling for what’s available in-house or locally.

#3: Small and Medium Scale Enterprises

Some SMEs struggle with challenges such as not wanting to incur additional staff costs or sometimes inadequate knowledge when it comes to dealing with software development lifecycles effectively. Nearshoring companies can help you build software products while maintaining high-quality standards and using the latest technologies best suited to your needs.

Points to Consider when Choosing a Nearshore Software Development Company

Do they have relevant experience?

Can they meet all of your requirements?

Are they flexible?

Are they able to apply different work practices?

Are they transparent when delivering good and bad news?

Are they capable of adapting to changes when needed?

Have they used various approaches to software development?


With our nearshore software development guide, more companies are taking advantage of nearshoring for outsourcing software development and technical services because it helps them cut the cost of projects, IT services, and application development. The two ideal use case scenarios for nearshoring are as a team augmentation solution to address talent shortage in your market or as a way of delegating specific parts of bigger projects so that you can focus on core activities.

At Next Idea Tech, we help our US partners with both of these services. As a nearshore development vendor based in the US working exclusively with talent from Latin America, we can help you scale your team on demand with seasoned software developers. Our developers are working with the latest trending technologies so that you don’t have to go through a big learning curve. And if you’re planning to outsource entire projects or certain parts of bigger projects, we can help you set up agile dedicated teams that can help bring your products to life. Hiring the right nearshore development team with validated credentials, advanced partnerships, and certifications from tech leaders can help you boost productivity and reduce costs while maintaining high-quality standards.

Get in touch with us to learn how we can help you reach your business goals.


Posted on

January 24, 2023