Analyzing The Factors Determining Offshore App Development Cost

One of the biggest questions that companies are asking nowadays is whether to outsource their software development project. But why do people go to outsourcing their development? The market size offshore app development was valued at USD 122,257.5 million in 2021 and is projected to reach USD 283,457.5 million by 2030. The reasons are simple: […]

Updated 4 March 2024

Ashish Chauhan
Ashish Chauhan

Global Delivery Head at Appventurez

One of the biggest questions that companies are asking nowadays is whether to outsource their software development project. But why do people go to outsourcing their development? The market size offshore app development was valued at USD 122,257.5 million in 2021 and is projected to reach USD 283,457.5 million by 2030. The reasons are simple: it is convenient, cost-effective, and has room for easy maintenance. However, different aspects determine the cost of offshore app development. One of them is the location of the company or freelancers taking on the project.

Another question is what is the average offshore app development cost? It must be noted that this article does not discuss the cost of mobile app development but the of outsourcing and/or hiring an overseas team for said development project.

The cost that you will offer for on-demand mobile app development is entirely different from the cost that you have to pay when hiring an offshore team. There are several advantages of offshore development, that are discussed in detail in the subsequent sections.

What is Offshore Mobile App Development?

Offshore development, quite literally means outsourcing your development project or hiring any third-party company, a team of developers, or an agency. However, in the IT sector, offshore outsourcing is mainly conveyed as hiring companies or agencies from a foreign land for product development and project management.

Based on the number of resources involved, offshore outsourcing app development can be of mainly three types such as:

  • Hiring a team of developers
  • Delegating certain parts or entire projects
  • Hiring an individual developer

Usually, companies hire freelancers that work on separate projects or modules for development. These freelancers are mostly categorized as 3D model artists, Unity3D developers, concept artists, Android app developers, Xamarin developers, iOS developers, etc.

However, individual developers do not bring the level of business expertise of a company or agency. Most venture capitalists and business owners, therefore, hire companies for an all-inclusive development service. To give you a better idea of offshore outsourcing, let us clarify what onshore and nearshore outsourcing are.

  • Nearshore Software Development – As the name suggests, it is outsourcing the development requirement but with agencies that are in the same time zone. The agencies can be in neighboring countries with a minimum time difference. 
  • Onshore Software Development – This is the one where the development agencies must be in the same country as the client. This makes it more adaptable and approachable for development requirements.
  • Smart Sourcing – Then comes the smart sourcing of the development that divides the tasks into modules and then outsources these modules to third parties. These modules are usually non-core operations that are required for product development.

These are the major types of outsourcing software development, now let us walk you through the pros and cons of collaborating with offshore software development partners.

What To Asses In An Offshore Agency When Approaching For Offshore Software Development?

There is no doubt that offshore outsourcing poses some major risks. This is mostly because it is hard to find companies that are credible and well-known in the market. There are some major concerns that one might have, such as – is the company expert enough to manage the development? Will they understand? What if they ran after taking advance pay?

These are a few of the major concerns that need answering when it comes to offshore app development. But it is essential to conduct thorough scrutiny and understand the work practices of the offshore development company before approaching them for a collaboration.

To help you out, here is a rough sketch of what companies must opt for before offshore custom software development outsourcing their product.

  • Do Your Homework – It is essential to know the ins and outs of any offshore mobile application development company before you hire them. It is best to know the marketplace, features, potential customers, target consumers, etc. that can help in providing insights into the offshore company before you hire them.
  • Roadmap – Prepare a roadmap and priority list to get a detailed insight into business requirements. This includes the legal regulations of that particular country, money transactions, and personal data transfers.
  • Prepare Mockups – A credible offshore software development company collaborates & will prepare a mockup or wireframe of your product. But it is also essential if the prototype of the product is prepared beforehand. It is best to seek answers to the questions like — What will the product look like? What are its vital features? How is it beneficial for customers?
  • Analyze Capabilities – Is the offshore company capable enough to manage the business models? Are they skilled? Have essential resources, tools, and technologies? These are the major questions that one must ask before making a decision.
  • Detailed Description – Know the product description and have documentation of it to set the quality standards. It will help in determining whether the offshore software development company can promise the same or not.

Red Flags To Watch Out For When Outsourcing A Project

While it is critical to conduct a thorough assessment, before enforcing any partnership with an outsourcing company, it is equally important to ensure that no hidden red flags are present. Red flags can be anything ranging from an unregistered status, no official license or work permit, undisclosed strength of resources, undisclosed address, etc.

Other factors to take cognizance of include a distinct cultural barrier, the risk of miscommunication, extremely low costs, wire transfers, etc., which must be rooted out before entering into a deal with an offshore outsourcing company. 

To elaborate further,  the risk of miscommunication which is also common when it comes to offshore development is a common issue. The fact is that it is not easy to communicate with the team that is staying overseas, in a different location and time zone. In the present time, electronic communication has simplified the overall project process which includes abstract concepts and complex ideas.

Another major risk of outsourcing is offshore app development costs. The cost of offshore software app development varies from one company to another even in the same location. Hence, it is best to understand the overall outsourcing app development cost concept overseas before finalizing one company. 

We know that offshore outsourcing is a great solution but there are certain red flags that one must keep in mind before hiring which is one of the major risks. The red flags to look out for while hiring an overseas company are as follows. 

Extremely Lower Cost

The development company can offer a bit of a discount but it is never reasonable. Hence, now that they utilize the proof of concept in software development, companies set a really low bar of cost to attract clients. This can, however, affect the quality of the app development and, in turn, not meet client project requisites.

outsourcing app development cost

Beware of Wire Transfers

Overseas hiring requires a money transfer for initiating the project. Hence, it is best to ignore wire transfers and go for a credit card or a secure payment method that offers protection against any type of fraud. 

No Local Contact Information

The contact information holds a lot of value when it comes to hiring a team from overseas. Remember, meeting the team personally is not possible every time. They are not sending out recurrent reports. It is, thus, essential to have proper contact details that are frequent and enables an easy way to get in touch with the team. All in all, the best way to be sure is to do in-depth background research – scrutinize their online presence, and check their portfolio before entering into a collaboration. 

How To Ensure Offshore App Development Becomes A Productive Initiative?

Now that you have decided to hire an offshore custom software development agency and invoke a legal partnership, the next critical step is to ensure the product partner is productive. The question is — how to ensure offshore app development becomes a productive initiative?

While the process of how to outsource app development must already be explained, subsequent steps to the initiation of the process are to be noted. There are so many things that are required like diligence, patience, and a clear understanding of skills when it comes to long-run projects. Hence, it is best to leverage as much as possible from the outsourcing team and ensure that they are productive.

offshore application development

Out-Taking & Outsourcing

As elaborated previously, the pros of hiring an offshore outsourcing team are numerous. But how to put these advantages to use is a true task. All in all, once the development process is complete, any communication except for cost settlement and maintenance and support must be avoided.

Hence, the new normal for software development in the digital workspace will be an ideal approach to go for project time frame development when it comes to hiring a team that is specialized in their skill sets. When it comes to outsourcing, out-tasking is the least drastic aspect that breaks up the elements at an external and internal level during development.

Hence, you are outsourcing a small portion of the project and utilizing the expertise available. It is best to only go for out-tasking when you don’t have to work on the whole project at once.

Hybrid Model

There are different requirements set that is included in the offshore app development cost that includes customer resource management, digital marketing, web designing & development, and so on. Hence, the maintenance and management of the mobile app development life cycle must be done constantly, which requires experts.

Then comes the hybrid model that can collaborate in-house teams with the offshore team to come up with an ideal solution. This can be followed to pick up the development and work with a team that can bring top-notch solutions. 

Intelligent Techniques

Another aspect to discuss is multi-sourcing. This is usually done when it comes to offshore outsourcing. Hiring the team for more than one element or a company project is a part of intelligent techniques. The major benefits of offshore app development companies as multi-sourcing are:

  • The outsourcing team knows the tricks for the right research and understanding of the competitors. 
  • Multi-sourcing leads to goal-oriented results.
  • Strong talent pool with limited restrictions in terms of outsourcing. With viable ways and workaround time, offshore outsourcing is at a great advantage. 
  • Lower cost and fraud risks when the project concerns intelligent ideas.

What Factors Determining Offshore App Development Costs?

It must be noted that 70% of companies choose to outsource their software development projects. The cost of offshore app development can be determined based on several factors including the location of the outsourcing agency, the hourly rate of development, the range of technologies involved, involvement of the number and types of teams, and post-production charges.

For instance, say you are outreaching an offshore development agency for a project on developing a mobile application. Depending on the location of the agency, the hourly rate of development would differ. In North America, the rate is $41 to $71, Western Europe charges $20 to $35, Eastern Europe negotiates for $13 to $18, and Latin America stands at $4 to $20. Companies in India charge somewhere between $5 to $40 – depending on the digital product’s complexity.

Again, this charge is further demarcated as per the variance of tasks involved in attaining the end-user product. For instance, UI/US design, frontend development, database management, architecture structuring, digital marketing requirements, maintenance and support, and so on. Time in hours spent on each of these tasks then determines the overall cost.

Why Appventurez is the Right Offshore Software Application Development Company

The best thing that any company owner can do while hiring an offshore outsourcing company is to do market research. This helps in calculating the offshore app development cost with flutter applications that can be beneficial for the business and also cost-effective. Offshore outsourcing holds a lot of value in the developing world due to the major standards set for the companies. Now, companies are adopting offshore app development companies due to the superior alternative to the talent and a long-term relationship.

However, it is essential to make sure that communication and management are effective as per the company without sniffing it up. This is where Appventurez steps in. Despite the geographical distances and varying time zones, our dedicated team of developers and designers remains tirelessly committed to delivering top-notch solutions. As a client-focused software development company, we pride ourselves on offering tailored services that prioritize your unique needs. Our unwavering commitment to real-time quality analysis and optimum performance management ensures that your projects are in capable hands, no matter where you are in the world. With our round-the-clock dedication, you can trust that we’re always here to provide you with the best possible solutions.

offshore app development company


Q. How much does custom app development cost?

Many factors impact the cost of app development: the complexity of the app, features, and functionalities, tech stack, etc. But the typical cost stands at $40 per hour. The overall cost of developing a mobile app ranges anywhere from $50,000 to $500,000.

Q. How to ensure the offshore outsourcing company is credible?

There are several factors to take into consideration when assessing the credibility of the outsourcing company. These include the official registration number, permit to indulge in profitable activities, valid location, online and offline presence, recognition, etc.

Q. How beneficial is outsourcing an app development project?

For a one-time build, outsourcing may be a more cost-effective and risk-free option. However, an internal team may make more sense in the long run if you’re constructing a scalable product that will be updated often. When it comes to releasing your mobile app, you don’t have to choose between the two.

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    Ashish Chauhan
    Ashish Chauhan

    Global Delivery Head at Appventurez

    Ashish governs the process of software delivery operations. He ensures the end product attains the highest remarks in qualitative analysis and is streamlined to the clientele’s objectives. He has over a decade of experience as an iOS developer and teams mentorship.