Top Destinations for Development Outsourcing: Best Offshore Software Development Countries

Mordor Intelligence predicts that the worldwide IT outsourcing industry will expand from $526.6 billion in 2021 to $682.3 billion in 2027, with most of the growth coming from the offshore software development model. Expectations are high for Estonia, Albania, Portugal, India, Vietnam, and Brazil to contribute significantly to this field. But before you look into the best offshore software development countries, you should understand why offshoring works. In this article, we will discuss what is offshore software development and the best countries for outsourcing software development.

Onshore, Nearshore, and Offshore- What Are These Models

In the globalized software industry of the present day, numerous development models have emerged to accommodate varying project requirements and geographical considerations. The following section represents each model in detail:

Onshore Software Development Model

In the onshore software development approach, a team based in the same location as the client or organization handles all phases of development. It has advantages, including better coordination and cooperation and compliance with regional rules.

Nearshore Software Development Model

Nearshoring refers to outsourcing business processes to countries near the company’s home country. If you’re based in North America and interested in trying software development outsourcing in Mexico, you’re engaging in nearshoring.

Offshore Software Development Model

Offshoring refers to outsourcing work to a company or individuals in a foreign country. Offshoring helps businesses cut expenses by using cheaper labor in other countries.

Why and When Do You Need Offshore Software Development?

Offshore software development is preferred for many businesses because it can save them money, provide access to a broader talent pool, allow for constant development, and can be scaled to meet growing demands. Offshore development is viable for businesses needing niche skill sets, accelerated time-to-market, or localized resource limitations. When the project’s needs are well-defined, and the lines of communication are open and direct, offshore software development can be valuable.

Benefits of Offshore Software Development Model

Let’s discuss the significant benefits of the Offshoring model:

Bridge for Skills Gap

While the need for software engineers is universal, some nations can provide skilled workers at reasonable rates.

You can fill your team’s expertise gaps with the reasonably priced professional personnel available in the most significant offshore software development countries like Estonia, Mexico, Brazil, etc. These nations are the best countries to outsource software development and also have the best company to outsource to.

Different Innovation and Perspective Angles

Offshoring overseas can be a great asset to a firm with a global focus. Imagine the potential for new perspectives brought by an IT expert’s upbringing in a different country.

Some other benefits include:

See how well your product fares in the eyes of an international audience.

Increase the amount of original thought invested into the creation of your software.

24/7 Development

The time differential between teams is a great way to get things done faster.

Let’s say you’re already in the outsourcing process. You also have your in-house team. That way, if one side is at rest, the other is hard at work, ensuring continuous development around the clock. So, even if there are breaks virtually every hour during the workdays, progress continues.

Cost Optimizations

If your firm works in a location with a high cost of living and, consequently, high charges for experienced developers, engaging a development team stationed abroad with lower prices would be a better choice.

One of the most cost-effective choices for offshore software development is Estonia and other Central European nations due to their relatively cheap wages and general living expenses.

Challenges Associated With Offshore Development Model

The following challenges arise when you’re working with offshore developers:

Communication Barrier

To effectively work with distant developers, you’ll need to adjust your usual modes of communication. Use instant messaging and video calling services like Google Hangouts to minimize communication barriers.

Legal Associations

If you decide to outsource your software development project, you should be ready to confront legal hurdles.

Addressing legal concerns concerning the offshore development firm or the client company is vital when working globally. There can be severe consequences for failing to resolve them on time.

Management Issues

Management can be tricky when collaborating with third-party companies on your IT project.

In this instance, you are responsible for the Discovery Phase. The project creation process begins with the Discovery Phase, a plan for implementing the project (a roadmap). In most cases, having a plan like this will allow you to make more precise predictions about how your project will progress.

Cultural Compatibility

In offshore development, cultural compatibility issues arise from the inevitable differences in business practices, communication norms, and work ethics from working across oceans. To lessen the impact of these difficulties, it’s important to create avenues for open communication and encourage mutual understanding amongst people of different backgrounds.

Best countries for outsourcing software development

Here’s a compiled list of the best countries to outsource web development:


The IT sector in India is mature, and it includes numerous enterprises that focus on a wide range of technologies and fields. India has stood out as a significant participant in software development for many reassuring. Its robust educational system results in many qualified software engineers and, thus, a considerable talent pool. In addition to being a low-cost option, outsourcing to India benefits from a skilled workforce that is also bilingual in English.


Ukraine comes in top offshoring countries. Ukraine is well-suited for outsourcing due to its convenient location, cultural similarities to European countries, affordable prices, and thriving IT community. It has an exceptionally skilled labor force, especially in artificial intelligence (AI), cybersecurity, and online and mobile application development. The country’s education system is excellent, and every year it turns out many IT specialists.


Poland has many positive attributes that make it an attractive location for businesses, including a conducive business climate, closeness to Western European countries, cultural compatibility, a robust infrastructure, and strict adherence to quality standards. Poland has established itself as Europe’s go-to outsourcing hub. Its education system is highly effective, resulting in a steady supply of qualified programmers. Also, Poland is in a time zone that coincides with several other European countries, making it easier to work together in real-time.


Due to its closeness and cultural compatibility, Mexico has been a popular outsourcing destination for firms in North America. The country’s IT industry is booming, particularly in software engineering, application management, and IT support. Mexico is a popular outsourcing destination due to its substantial bilingual workforce, low wages, and proximity to the United States.


Brazil is quickly becoming a significant player on the global stage of software outsourcing. It has a thriving IT sector and a sizable population of highly trained software engineers. Brazil’s advantages include a deep pool of talented people, a competitive cost structure, a reputable educational system, and cultural familiarity with the West. Due to the time zone, there is considerable overlap between North American and local business hours.


India, Ukraine, Poland, Mexico, and Brazil are top offshore software development countries. These nations provide abundant resources, including skilled workers, low wages, a welcoming culture, and a solid educational foundation. To identify the best countries for outsourcing software development, it is crucial to consider the unique needs of the project at hand.