What is Outsourcing?

Outsourcing is an agreement in which one company hires another company to be responsible for a planned or existing activity that is or could be done internally

Wikipedia

In other words, outsourcing arises when a business hires an outside team\independent specialist to provide goods and services, rather than doing the work in-house.

What is Outsourcing: Example on a Digital company

A Digital company from the USA wanted to have additional income and do websites for their clients for future promotion inside their company.

The digital company has 2 ways:

  1. Organize an in-house web development department.
  2. Find a web development team outside their company. That means that they will take web development services from other companies.

Outsourcing practice started to be popular in the 1990s and continue growing

The most popular directions for outsourcing in Ukraine:

  • Software development
  • Web development
  • Mobile development
  • Design
  • Content writing
  • Accountant
  • HR management

5 Reasons Why do Companies Outsource to Ukraine?

1) Don’t have time to build an in-house team

The hiring process often takes a lot of time. After you hire employees you should build processes inside the department which will be connected to the general process in the company. After that, you should care about the relationship in the team. All these require a lot of time.

Related Interview: Experience working in one team with an outsourcing company from Ukraine

2) High taxes that companies pay for their employees in developed countries

In developed countries, employees are very much protected by the government. Usually, that requires additional budget from the business owner

3) Lower cost

Outsource gives the opportunity to people from developed countries hire people from developing countries. Often that helps them to reduce the cost of work

4) Don’t have time for in-house team management

Creation of conditions for the work of employees: cleaning offices, corporate events, insurance, themed gifts, etc. Meanwhile, by outsourcing, you will be able to focus, just on the specific to for your business tasks.

5) You pay for what is done. No need to pay the salary which is often not connected to the resulting work

When outsourcing you don’t pay for vacations, holidays, employe’s education, snacks in the offices, etc… you just pay tasks which were done.

How does outsourcing work?

Depending on where you plan to find a supplier you can use marketplaces like Upwork or listing websites like Goodfirms

Marketplace: is a good solution if you want to find someone for small tasks. But, marketplaces are popular with students or people who have a full-time job and want to have an additional income.

Listing websites: like Goodfirms are more popular with professional companies who are working more than 5 years in the industry.

Related post: Top 3 platforms to start working with Ukrainian team?

Conclusion

Outsourcing is the way to delegate tasks which are not covered by your business. That helps to reduce cost and work more effective. Outsourcing in Ukraine is highly popular by software development companies.