What’s the difference between nearshore, onshore and offshore?

If you have ever researched software development outsourcing, you have probably heard of these three business models: nearshore, onshore and offshore. The options emerged with the growth of the outsourcing market.

According to data from Statista, the outsourcing market has grown from $45.6 billion in 2000 to $85.6 billion in 2018. With this outsourcing boom came models that address different distances between technology partners.

Today, we will describe the differences between nearshore, onshore and offshore, and their pros and cons. Take a look!

Onshore software development

Onshore means outsourcing software development to companies located in the same country or region as your company.

The advantage of onshore is the ease of communication, as they share the same native language, and there is no time zone difference problem.

The disadvantage of onshore lies in its price, which is the highest among the three models.

Offshore software development

Offshore is a matter of hiring a remote team from a faraway country. For example, hiring a team from India or China would be offshore for a company located in the United States.

• You can also like: 5 communication problems in software development

The most significant advantage of offshore is the highly competitive pricing of these distant partners, making it a much cheaper option than onshore.

As a disadvantage, offshore entails more significant communication difficulties between teams, given the cultural, language, and time zone differences.

Nearshore software development

Nearshore outsourcing is a very well-balanced solution among the three models. When we talk about nearshore, we refer to hiring foreign teams from nearby countries in a similar time zone or one with minimal differences.

Thus, nearshore offers the advantage of good communication, lower prices than onshore, more excellent cultural proximity than offshore, and the possibility of visits between teams.

Want to know more about the three outsourcing models?

Download our infographic made for U.S. companies deciding between nearshore, onshore and offshore:

What to look for in nearshore, onshore and offshore enterprises?

Transparency

When outsourcing software development, it is indispensable for all information to be clear and easily accessible. Communication can impact transparency.

Flexibility

During a project, new needs may emerge, and the scope may need to be aligned. Look for agile partners in the face of change and flexibility, focusing on your company’s goals and your customers.

• Read it: Technical case – the differential of good security practices in international projects.

Result-oriented

Seek partners that understand the expected result, collaborate to achieve it, and not just deliver what is requested. They should cooperate and be thoughtful in the development process.

DB1 is among the Top 10 nearshore development companies

Latin America is the leading destination for U.S. companies, and DB1 is among the top 10 in Brazil.

According to Clutch, a platform that connects brands to the best companies in various services, such as software development, web design, and digital marketing, we have been recognized among Brazil’s top 10 nearshore companies.

Being among the Top 10 is great recognition, demonstrating that the international technology market perceives our constant pursuit of quality, transparency, alignment with deadlines, and total focus on the client’s business.

With DB1 Global Software, you can count on a whole team to achieve your needs. Click on the image below and meet us!