IT Nearshoring in Europe for Your Software Development

The key idea of this article is to make you understand how your business can profit from nearshore software development services in Europe as well as approaches to avoid risks so that such a partnership will be profitable. Startup leaders are always about speedy but efficient delivery processes and the records of success among Central Europe developers stands as a testimonial. It is a really friendly region to gain industrial expertise and top-rated developers for a fraction of the cost due to lower taxes and focused budgets.

Europe Nearshoring Software Development Trends 2023

More companies outsource software development and technical services because it helps them cut costs for projects, IT services, and application development by 40-50%. 

Nearshoring allows companies to work with development teams in nearby countries, rather than outsourcing to distant locations. This trend is driven by a desire for more control and faster turnaround times, as well as cultural similarities between countries. 

By 2023, it is projected that nearshoring will continue to grow, with more companies choosing to work with development teams in Central European countries such as Poland, Croatia, Portugal and Romania. Additionally, there is expected to be an increased focus on agile development and more sustainable software development practices.

Business Profits of Nearshore Software Development in Europe

There is a great chance for businesses to save and significantly increase profits by nearshore software outsourcing in Europe. We at ProCoders know all the nearshore outsourcing advantages, and we are ready to share them with you:

Cost-Saving due to High-Quality Code

With access to the European market, businesses can benefit from a wide variety of experienced developers who are well versed in the latest technologies. ProCoders, for instance, follows a rigorous development process that prioritizes security, business responsibility, and timely delivery of solutions. We leverage our industrial experience to produce top-quality software products from Central Europe.

Ease Papers’ Accompaniment of Collaboration

Moreover, nearshore software development company in Europe helps to reduce the cost of paperwork, as well as other administrative costs associated with international collaboration. Our experienced team at ProCoders has an extensive network of contacts that help to streamline the paperwork necessary to set up a successful nearshore project. We take care of all the documentation and legal formalities so you can focus on your core business activities.

Zero Communication Loses

Central European culture emphasizes efficient business communication, using workflow transparency to minimize the impact of time differences and ensuring continuous online availability of code versions. Additionally, Central European developers possess strong English language skills and have achieved success in global project collaborations.

Flexible and Fast Upscale and Downscale

Nearshore development in Europe allows businesses to easily adjust the scope and size of the project depending on their needs. Companies can scale up or down quickly in response to changing market conditions and customer demands. At ProCoders, we understand the importance of agility and are ready to provide a flexible solution that allows businesses to quickly adjust their development processes.

Reasonable Costs Per Hour and High-Performance

Several companies seek outsourcing opportunities to benefit from lower costs and faster delivery. Estonia, Romania and Croatia are considered among the most cost-effective countries for outsourcing software development projects, offering a beneficial balance of rates and quality solutions.

Risks of Nearshore Software Development in Europe

Nearshore software development outsourcing in Europe comes with certain risks that need to be taken into account. We at ProCoders used to hear some of them from our European clients, so here is our top 4 nearshoring software development in Europe risk:

4. Cultural differences

Nearshore software programming in Europe involves working with teams located in nearby countries, but cultural differences can still exist, and it’s essential to recognize and manage them. These differences can include communication and project management styles, work ethics, hierarchy, and decision-making processes, to name a few. In order to overcome these differences at ProCoders we foster cross-cultural understanding through effective communication, respect for cultural norms, and building strong relationships between all team members. 

3. Language barriers

Language barriers can be a significant concern when dealing with European nearshore software developers. In Europe there are many different languages spoken, and it’s not uncommon for businesses to outsource work to countries where the primary language is not the same as their own. As such, communication can become a challenge, and misunderstandings can occur, leading to delays and inefficiencies. At ProCoders, we believe hiring developers with proficiency in English as an international communication tool is the best solution to this challenge.

2. Quality control

The development team in nearshore software development is external to the company. This can cause quality control issues if the team is not vigilant or there is a misalignment of priorities. At Procoders, we ensure stringent measures in the development process. We establish clear software development specifications, monitor the project’s progress through close communication, and conduct comprehensive testing to check for bugs and errors. 

1. Data security concerns

Data security is crucial due to the challenges of protecting data when the development team is located in another country. A non-compliant nearshore development team can result in expensive fines, legal problems, and damage to reputation. ProCoders ensures data protection through measures such as data encryption, secure storage, regular backups, and clear access policies. We also have legal contracts detailing data handling and commit to regular audits for compliance.

Top Destinations for Nearshore Software Development in Europe

Selecting the optimal location to outsource app development can pose challenges. A significant number of software firms in Central Europe offer cutting-edge solutions at reasonable rates. However, specific countries in the region have emerged as the preferred nearshore IT development in Europe options, given the varying needs of each project.

Estonia

It has become a popular destination for companies seeking to benefit from the European IT outsourcing market. The country was among the first in Europe to introduce e-Residency, which permits non-Estonians to establish a business there. The entire procedure can be conducted online with the use of a digital ID.

The program has benefitted many startups and Estonia is an appealing outsourcing location due to its strong educational system in software development and technology. Despite its small size, the government’s efforts toward innovation are evident.

Poland

Poland has a significant number of IT specialists who work for numerous IT companies that specialize in nearshore software development. The country’s primary advantages consist of proficient English skills and technical expertise.

Bulgaria

Bulgaria is one of the largest IT nearshore Europe emerging markets for tech products. Companies there have access to top talent coming from local universities with specializations in computer science or information technology.

Slovakia

When considering outsourcing software development, Slovakia is a viable option due to its cultural diversity and stability, which are attractive to investors. The country has established strength in this field, despite being an emerging market.

Hungary

Hungary has a history of being a pioneer in Central European outsourcing, with some IT companies operating there since the 1990s. Budapest is considered a prime location for outsourcing software development projects due to its large developer pool.

Romania

Romania is a good choice for nearshore software development options. It has skilled tech specialists and reasonable rates. The Romanian government offers incentives to foreign investors, making it attractive for outsourcing. Romania is known for its strong research and development capabilities, especially in cloud computing, big data, and artificial intelligence. 

Portugal

Nearshore software development is becoming popular in Portugal due to its skilled workforce and cost savings. Portugal is ideal for doing business with its low corporate tax rate and friendly business environment. Companies can also benefit from the government’s innovation initiatives supporting the vibrant startup culture.

Rates for Nearshore Software Development Services in Central Europe

Nearshore software development services are a great way to start a business in Central Europe. Costs are relatively low compared to Western European countries. Also, you can easily find highly skilled programmer. This section provides information on rates for web development services in Central Europe. The following rates, annual developers’ salaries, are culled from salaryexpert.com.

Countries	Junior	Mid-level	Senior
Estonia	$422,196	$44,166	$51,228
Poland	$38,239	$56,102	$79,857
Bulgaria	$30,571	$54,966	$72,994
Slovakia	$17,960	$33,293	$46,335
Hungary	$20,337	$41,059	$55,145
Romania	$21,000	$33,000	$50,000
Portugal	$41,000	$60,000	$80,000

IT Nearshoring in Europe for Different Business Stages

Before you hire remote developers via nearshoring (maybe you are looking for hire app developers), consider how nearshoring can help your business regardless of the stage of development:

Startup MVP

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

Startups at pre-seed and seed rounds

If you’ve already tested your MVP and looking to raise money for further development, you should seek a software development company to scale your idea. Software development nearshoring to Europe helps you find developers for startup, giving you immediate access to a massive talent pool with low employee costs. This enables flexibility in technology — opt for product fit instead of settling for what’s available locally.

Small and Medium-Scale Businesses

Some SMBs may struggle with various challenges because they don’t want to have additional staff costs, while others might lack knowledge about dealing with these challenges effectively. Nearshoring companies can help you to develop software while maintaining high quality standards and using the latest technologies best suited for your needs.

Large enterprises

Large companies with a global presence who want software development done faster and more efficiently don’t often like to use outsourcing because they consider it not secure enough for their process. However, they can tap into outsourcing through an offshore research and development team as well as when they need a very narrow expertise for a one-time task.

Aspects that Influence the Quality of Nearshore Outsourcing in Europe

A question keeps popping up: what will be the crucial factors that guarantee a successful project? How can we choose the proper scope and establish control measures to prevent project failure during remote collaboration?

Educational systems

Central European countries have always been focused on developing their education systems. This spills over into a very efficient IT talent-building system. In addition, there is the part of exposure to online courses of international standard, as well as experience with worldwide corporations that makes great impact on the developers’ level and professional abilities.

Soft skills

One essential factor that determines the quality of an offshore software development partner is its developers’ soft skills. This includes problem-solving and critical thinking, interpersonal skills, self-awareness, accountability, time management, emotional intelligence.

Experience and IT community

Central Europe, perhaps the most globally prominent nearshore destination, with a steadily growing number of IT specialists. The area is now a hub of skilled developers who may adapt to unique requirements quickly after onboarding a new project. Central European countries have significant communities with many specialized meetups, conferences, educational courses, etc.

Legal environment

Talking about the legal environment, we mean law regulations and business practices that directly affect the IT industry. Most Central European countries are EU members. The countries have signed many international treaties that make their business laws more transparent, predictable, and reliable for foreign investors.

Increasing Pool of Ukrainian Developers

The nearshore software development market in Europe is becoming increasingly competitive due to the emergence of a new pool of talented Ukrainian developers. Ukrainian developers have the advantage of being fluent in English, which makes communication and collaboration much easier. Moreover, Ukraine provides great opportunities for professional development and growth with its wide range of IT-related education programs. Therefore, it is no surprise that Ukrainian developers are in high demand among nearshore software development companies in Europe. With the right combination of talent, experience, and cultural understanding, Ukrainian developers can be a powerful asset to any project.

How Procoders Could Help with Nearshore Software Development in Europe?

At ProCoders, we have 3 main work models:

Discovery phase

This one is an especially valuable one for startups. Usually, they have budget limits, somewhere between $50.000 and 60.000. For a startup’s development plan, a clear vision of its future project is essential. So, it’s better to pay from $5.000 to $15.000 on top for the Discovery phase to make a very detailed plan for your future project. This way you’ll be sure, that you have all resources (people and money) you’ll need to make a working product. Or maybe you will find out that your budget is too small for your idea. But you’ll know it before you spend the whole of your budget and still got nothing!

After the discovery phase, you may decide to make MVP first. This will be a working app that you can show to your investors to gain more money. Example: Dryft. We made the discovery phase for this project and MVP;

Staff augmentation

This work model suits best for ongoing projects, but sometime can be good for startups too. The main idea is that you already have tech lead and working team, you just have less “hands” that you need. Example: HANDLE. We provide some great developers for this project.

Dedicated team

This option is great for startups (after the discovery phase) and enterprises that want to update some parts of the project, but the human resources they have are not enough. They don’t need a permanent employers for this task, just have work done. Example: Quarts Network.

Actually, it all depends on the clients. If you know what you want to build but you have no plan for it – the discovery phase is your solution. After it, you may want to hire a dedicated team. If you have an already working team but need some more developers – staff augmentation is your best choice.

Currently, our area of expertise cuts across the following tech stacks and industries:

Tech Stack We are Experienced in::

• Frontend: Angular, React, Vue
• Backend: Node.js, PHP/Laravel/Symfony, Ruby on Rails
• Mobile: React Native, Flutter, Ionic
• Cloud development: AWS, Google Cloud Platform, Firebase

Industries We Have the Deep Expertise:

• Logistics
• Online Education
• Social Network
• Retail
• IoT
• SaaS
• Document Management Systems/CMS

One of our prominent nearshore engineering projects was executed for SDCN, a company that serves as an Uber for trucks. We helped them migrate from an old PHP version to a more updated approach and built an online payment from the scratch. We provided a dedicated team from the discovery phase which worked with Angular, Laravel, MySQL, Stripe, and Flutter.
By working with ProCoders, we saved them 6 months in the search for developers (compariong with in house team hiring) and we raised their user base by 10% through a faster, more responsive app. Also, by migrating the previously manual payment system to an online approach, we optimised the operations efficiency for the company.

Conclusion: Key Takeaways

• Nearshore software development Europe agencies provide top-notch staff augmentation for tech startups and SMBs services.
• Estonia has been a favorite destination for companies looking to gain from the European IT outsourcing market. Estonia might not be a big country, but the evidence shows the government is working hard towards innovation.
• Nearshoring helps you find developers for startup, giving you immediate access to a massive talent pool with low employee costs.
• Central Europe perhaps the most globally prominent IT outsourcing destination, with a steadily growing number of IT specialists.