After the COVID-19 pandemic, global supply chains will never look the same. Businesses all around the globe are rethinking their supply chain strategies and bringing production back. However, that does not affect the digital supply chains. Offshoring software development remains a trend and is not expected to die down any time soon. In this article, you will get to know the emerging outsourcing destinations, the main issues that startups and small businesses face when outsourcing, and what our team at SourceStack do to facilitate the process for startups and small businesses.
Eastern Europe as a Major Player in the Outsourcing Game
Outsourcing to Eastern Europe has become increasingly popular since 2008 when companies started seeking cost-cutting solutions and new partners in the emerging region. Offshoring to this region yields a number of advantages for western companies: comparatively low wages, cultural and geographical proximity to Western Europe. Eastern Europe as an outsourcing destination has been gaining popularity among western companies and becoming a strong competitor for India in the last 5 years. Ukraine, in particular, has been gaining momentum in the last decade, with extremely high-quality teams, moderate rates, and mature workflows.
According to the recent PwC analysis, the market for outsourcing increased by 150% from 2011-2015 and it is expected to reach $5.7 billion by 2021 (Devabit, n.d.). The countries that embraced offshore outsourcing are the United States and the United Kingdom, whereas Western European countries have been slower in adopting offshore outsourcing (Czinkota, 2009). With more western countries adopting offshore software outsourcing, Eastern European countries have high stakes in this growth opportunity (Czinkota, 2009).
The most common outsource destinations in Eastern Europe are Ukraine, Belarus, Romania, Poland, Russia, Bulgaria, Czech Republic, Hungary, and Armenia. The software teams in Eastern Europe are qualified to handle advanced enterprise technologies such as Ruby, .Net, Java. The teams are keeping up with the latest advances in the tech space and are innovation-ready, which makes the region a good outsource destination (Osetskyi, 2019). The geographic location is more convenient compared to Asia both for the…