Sun Mar 05 2023
Founders & Tech Leaders

The Benefits of Custom Software Development Outsourcing

Tazeen Fatima
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Custom software development outsourcing has become increasingly popular over the past few years, and it's not hard to see why. Companies of all sizes and industries have been turning to outsourcing to increase efficiency, reduce costs and access a pool of skilled talent.

In this article, we'll take a deep dive into custom software development and its benefits and learn why it's an attractive option for companies looking to enhance their technology infrastructure.

What is outsourced software development?

Outsourced software development refers to the practice of hiring an external company or individual to design, develop and maintain software applications and systems. This outsourcing can occur domestically, within the same country as the hiring company, or internationally, in a different country.

The primary goal of outsourcing software development is to provide companies with access to skilled software developers, specialized expertise, and improved technology infrastructure, without having to bear the cost of hiring and training in-house staff. This allows companies to focus on their core competencies, while outsourcing non-core activities to specialized professionals.

In addition to development services, software development outsourcing companies often provide additional services, such as project management, quality assurance, and ongoing maintenance and support required for their software projects. This allows companies to enjoy a complete software development solution, without having to manage multiple contractors or service providers.

Overall, outsourced software development is a popular option for companies of all sizes and industries, as it provides a cost-effective and efficient way to build, maintain, and enhance their technology infrastructure.

Top software development outsourcing models

Software development outsourcing models refer to the various ways that organizations can work with software development companies to create software solutions. Some common outsourcing models include:

- Dedicated Team Model

In this model, the outsourcing company provides a dedicated team of developers, designers, and project managers to work exclusively on the client's project. The client has complete control over the team and can direct their work as needed.

- Time and Material Model

In this model, the outsourcing company provides the client with a team of developers and project managers on a time and material basis. The client pays for the actual hours worked by the team, and can adjust the size of the team or the scope of the project as needed.

- Fixed-Price Model

In this model, the outsourcing company provides the client with a fixed quote for the entire project, and the client pays a set amount for the development work regardless of the actual hours worked by the team.

- Hybrid Model

This model combines elements of multiple outsourcing models, such as a dedicated team and time and material, to create a customized solution that best fits the client's needs.

- Staff Augmentation Model

In this model, the outsourcing company provides additional resources to augment the client's existing development team. This can help to fill skill gaps or provide additional support for a specific project.

Each outsourcing model has its own advantages and disadvantages, and the best choice will depend on your specific needs and requirements for your custom software development projects. For example, some organizations prefer the predictability of a fixed-price model, while others prefer the flexibility of a time and material model. It's important to carefully evaluate the options and choose the outsourcing model that best fits your needs and goals.

The experience of working with software outsourcing companies

IT outsourcing services can provide numerous benefits for organizations, including access to specialized skills and expertise, reduced costs, and increased efficiency. However, it's important to establish a strong relationship and clear communication with the outsourcing company to ensure a successful project outcome.

Here are some steps to help ensure a smooth and successful outsourcing experience:

1. Define project requirements

Clearly define the scope of the project, including specific requirements and deliverables, to help ensure that both the client and the outsourcing company have a shared understanding of the project goals.

2. Choose the right outsourcing model

Consider the different outsourcing models available, and choose the one that best fits the client's needs and requirements.

3. Select the right outsourcing company

Carefully evaluate the options and choose a software outsourcing company that has the expertise and experience needed to deliver the project.

4. Establish clear communication

Clearly define the lines of communication and establish regular check-ins and updates to ensure that the project is progressing as planned.

5. Monitor project progress

Regularly monitor the project's progress to ensure that it is on track and that any issues are addressed in a timely manner.

6. Foster a positive relationship

Build a strong relationship with the outsourcing company and work together to address any challenges that may arise. A positive and collaborative relationship is key to a successful outsourcing experience.

Working with a software outsourcing company can bring numerous benefits, but it's important to approach the process with care and attention to detail. By establishing clear communication, monitoring progress, and fostering a positive relationship, organizations can ensure a successful and productive outsourcing experience.

Must read: Top Solutions to IT Outsourcing Challenges

Why companies outsource software development?

Companies opt for software outsourcing services for a variety of reasons, including:

Access to skilled talent

One of the biggest advantages of outsourcing custom software development is the access to a vast pool of skilled talent. This means that companies can choose from a large number of developers, designers and project managers, ensuring that they find the right person for the job. By outsourcing, companies can tap into the expertise and knowledge of professionals from all over the world, giving them access to a wider range of skills and perspectives.

Reduced costs

Outsourcing custom software development can significantly reduce costs for companies. By outsourcing to a low-cost country, such as India or the Philippines, companies can reduce their labor costs while still getting access to top-quality talent. Additionally, outsourcing eliminates the need to invest in expensive software and hardware, which can be a significant drain on resources.

Faster time-to-market

When outsourcing custom software development projects, companies can take advantage of the 24/7 work schedule and faster project completion times. This is because outsourcing companies can allocate a large number of resources to a project, ensuring that it is completed on time and within budget. Additionally, outsourcing companies often have a proven project management methodology, ensuring that projects are completed efficiently and effectively.

Improved quality

Outsourcing custom software development can lead to improved quality in several ways. First, outsourcing companies often have a strong focus on quality assurance and testing, ensuring that the final product is of a high standard. Second, outsourcing companies can leverage the expertise of a wide range of professionals, which can lead to better solutions and a more polished final product. Finally, outsourcing companies often have a continuous improvement culture, which means that they are always looking for ways to improve the quality of their work.

Increased flexibility

Outsourcing custom software development provides companies with increased flexibility, allowing them to scale up or down their operations as needed. This means that companies can quickly and easily add new resources to a project, or reduce their staffing levels if the project requires it. This level of flexibility is especially important for companies that experience fluctuations in demand for their products or services.

Focus on core competencies

By outsourcing custom software development, companies can free up their in-house resources and focus on their core competencies. This means that companies can concentrate on what they do best, while outsourcing the development of their software to experts in the field. This allows companies to focus their efforts on revenue-generating activities, and helps to ensure that they remain competitive in their respective markets.

How is technology shaping the future of software development outsourcing?

Technology is playing a significant role in shaping the future of software development outsourcing. Advancements in digital transformation and technology are enabling organizations to collaborate more effectively with software outsourcing companies, regardless of geographical location. Additionally, new technologies are helping to improve the quality of outsourced software development and make the process more efficient.

Cloud Computing

Cloud computing is changing the way software is developed and delivered. With the ability to store and access data and applications from anywhere with an internet connection, organizations can collaborate with software outsourcing companies more effectively, regardless of location.

Artificial Intelligence

Artificial intelligence (AI) is being used to automate many tasks in software development, including coding, testing and bug fixing. AI can help to speed up the development process and improve the quality of the end product.


DevOps is a software development method that emphasizes collaboration and communication between development and operations teams. By integrating DevOps into the software development outsourcing process, organizations can ensure that the development and delivery of software is more efficient and effective.

Internet of Things

The Internet of Things (IoT) is driving the demand for new software and applications, and software development outsourcing companies are well positioned to meet that demand. With expertise in developing IoT solutions, outsourcing companies can help organizations to leverage this technology to improve their operations and gain a competitive advantage.

Agile methodology

Agile software development methodologies, such as Scrum and Kanban, have become increasingly popular in recent years. By incorporating Agile methodologies into the outsourcing process, organizations can benefit from several key advantages, such as better collaboration, transparency and risk management.

Technology is shaping the future of software development outsourcing by enabling organizations to collaborate more effectively with software outsourcing companies, regardless of location. Additionally, new technologies such as cloud computing, AI, DevOps, and the IoT are helping to improve the quality of outsourced software development and make the process more efficient.

What to look for in a software outsourcing company?

Choosing the right custom software development outsourcing company is critical to the success of your software development project. By carefully evaluating your options and considering the following key factors, you can find a partner that can help you to achieve your goals and take your business to the next level:

- Expertise

It is important to look for a company with a proven track record of delivering high-quality software solutions. The company should have a deep understanding of the latest technologies and industry best practices, and be able to demonstrate their expertise through portfolio samples and client references.

- Communication

Effective communication is essential for a successful outsourcing relationship. Look for a company that is responsive, reliable, and able to communicate clearly and effectively throughout the development process.

- Project management

A good outsourcing company should have strong project management skills and be able to effectively plan, execute, and deliver software projects on time and within budget.

- Cultural fit

It is important to choose a software outsourcing company that shares your values and business culture. This can help to ensure that the development process is aligned with your company's goals and objectives.

- Flexibility

The outsourcing company should be flexible and willing to adapt to changing requirements and business needs. They should be able to accommodate changes in scope and be able to pivot quickly if necessary.

- Pricing

Make sure to consider the cost of outsourcing, as well as the company's pricing structure and payment terms. Choose a company that offers a fair and transparent pricing model, and be sure to fully understand the costs associated with each stage of the development process.

- Reputation

Look for a company with a positive reputation in the industry, and take the time to read online reviews and testimonials from previous clients. This can help to ensure that you are working with a reputable and trustworthy outsourcing partner.

What software development services can be outsourced?

A wide range of software development services can be outsourced, including:

Custom software development: This involves the development of custom software applications tailored to meet specific business needs and requirements. This may include web applications, mobile applications, desktop applications and more.

Website development: Outsourcing companies can provide website development services, including design, development and deployment of custom websites, e-commerce websites, and other web-based applications.

Cloud computing services: Outsourcing companies can also provide cloud computing services, including cloud infrastructure management, cloud application development, and cloud migration services.

Software maintenance and support: They provide ongoing software maintenance and support services, including bug fixing, security updates, and performance optimizations.

Software testing: They provide software testing services, including functional testing, performance testing, security testing and more.

Data management: They also provide data management services, including data warehousing, data integration and data migration services.

Mobile application development: They even provide mobile application development services, including native app development, hybrid app development and cross-platform app development.

Artificial Intelligence and machine learning: Outsourcing companies can also provide artificial intelligence and machine learning services, including the development of custom AI and ML models, as well as data analysis and data visualization services.

Why is Remotebase the most trusted custom software development company?

Remotebase has a robust network of skilled professionals and offers top-rated developer teams within 24 hours that best match your requirements, timezone and work model. Our Silicon Valley standardized vetting process includes multiple technical assessments and interviews to ensure we only provide you with the world's top 1% of remote software developers.

We have been working with some leading global companies, including Fireflies,, and Northwestern Mutual, helping them achieve their development goals quickly. You can try our tech team for two weeks absolutely free and work with your ideal custom software development team to see the difference yourself.

Build your development team with Remotebase today!


Custom software development outsourcing offers a number of significant benefits to companies of all sizes and industries. From access to skilled talent and reduced costs, to improved quality and increased flexibility, outsourcing is an attractive option for companies looking to enhance their technology infrastructure. So, whether you're a start-up looking to build your first app, or an established company looking to streamline your operations, custom software development outsourcing is worth considering.

Make your next software development project a huge success by hiring the world's top 1% software developers within 24 hours. Hire now!

Frequently Asked Questions

What is software development outsourcing?

Software development outsourcing refers to the process of contracting a third-party company to create software solutions for an organization. This allows organizations to access specialized skills and expertise, as well as reduce costs and increase efficiency.

Why do companies outsource software development?

Companies outsource software development for a variety of reasons, including access to specialized skills and expertise, cost savings, increased efficiency, and the ability to focus on core business activities.

What should I look for in a software outsourcing company?

When choosing a software outsourcing company, it's important to look for expertise, effective communication, project management skills, a proven track record, and a good reputation. It's also important to choose a company that fits the organization's specific needs and requirements.

What are the different software development outsourcing models?

The different software development outsourcing models include dedicated team, time and material, fixed-price, hybrid, and staff augmentation. The best choice will depend on the organization's specific needs and requirements. It's important to carefully evaluate the options and choose the outsourcing model that best fits the organization's goals and objectives.

Is outsourcing a cost-effective solution for software development projects?

Outsourcing software development can be a cost-effective solution for organizations, as it can reduce costs associated with hiring and training employees, as well as provide access to specialized skills and expertise. However, the actual cost savings will depend on a variety of factors, including the outsourcing model chosen and the specific needs of the organization.

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