Why Latin America Is Great for Software Outsourcing?

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Why Latin America Is Great for Software Outsourcing?

More and more companies are turning to Latin America for their software outsourcing needs. Why? Latin American nations offer a broad mix of critical benefits that make this region a natural choice.

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Software outsourcing offers a broad range of mission-critical advantages. However, not all outsourcing models deliver the same value, and some, such as offshoring, can actually lead to challenges, such as miscommunication due to language barriers and cultural differences. Nearshoring offers the right mix of benefits and capabilities, but where can US-based organizations turn to find the IT talent required for success?

More and more, the answer is Latin America. 

Why Latin America, though? The truth is that this region of the world offers critical benefits and can be an excellent match for the needs of US businesses seeking to reduce costs without sacrificing access to software development expertise.

There are as many reasons to outsource your software development needs to Latin America as there are companies considering the move. However, some reasons are more compelling than others. In this post, we will explore some of the most important reasons why Latin America is the ideal fit for software outsourcing.

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Latin America: The Compelling Advantages for Software Outsourcing

In a Nutshell

If you’re looking for a quick answer to why you should consider Latin America for your software outsourcing needs, the table below lays it all out for you. 

Workday overlap  No Time Zone DifferencesFew Cultural Differences
No Language BarrierClose Proximity for TravelRobust IT Programs and Deep Talent Pool
Strong InfrastructureCost Advantages and Beneficial Tax PoliciesMajor Anchors

Of course, you might need a bit more information about each of these benefits. We’ll discuss them all below.

1. Workday/Workweek Overlap

In the US, most businesses operate on a Monday through Friday schedule. That is not the case for all regions of the world. For instance, in some countries, Friday and Saturday form the weekend. Differences like this can make it challenging to complete successful projects together or even communicate in some instances. Latin American nations share the same workdays as the US, eliminating those problems and ensuring more straightforward, more accessible communication.

2. Time Zone Differences

One of the major drawbacks to offshoring your software development needs is the difference in time zones. When outsourcing to a nation in Southeast Asia, for instance, your outsourcing partner will be hours ahead of you, which can make communication and collaboration nearly impossible, particularly on a project where you must work closely together. When you outsource to Latin America, you will find that the time zones are very similar to the US, ensuring easier communication, better collaboration, and increased success for your projects. For instance, Buenos Aires is 7,000 miles from the United States but is only two hours ahead of New York City.

3. Cultural Differences

Cultural differences can wreak havoc on shared projects. It can lead to misunderstandings and miscommunications, lead to errors, and failure to reach critical milestones. However, Latin American nations share many similarities with the United States’ culture, making outsourcing your software development project an intelligent decision.

4. No Language Barrier

While Spanish and Portuguese are the primary languages of Latin America, English is widely spoken. This is especially true in business circles and within the IT industry and the software development sector in particular. According to Babbel Magazine, “English is the third most spoken language in South America, with about 5.4 million speakers. Most of them live in Argentina and Columbia, followed by Guyana.” This does not even count the significant percentage of English speakers found in Central American nations and Mexico. With no language barrier, you will find it easier to achieve success, communicate your needs, goals, and requirements, and ensure that you and your software developer are on the same page.

5. Proximity

Air travel is costly, prohibitively so when you consider traveling far afield. However, Latin America is within easy reach, making it more affordable to travel for software development-related needs. Whether you need a face-to-face with your team or there’s another reason for you to travel, you’ll enjoy financial savings and less time in the air. There is also the fact that because Latin America shares the same time zones as the US, there is minor adjustment necessary to accommodate jet lag.

6. Robust IT Programs and Deep Talent Pool

There’s a notion that the best tech schools are in the US. While there are certainly some excellent schools, the United States does not have the market cornered on high-quality higher education. Many Latin American nations have made significant investments into their colleges and universities, particularly when it comes to IT programs. The result? A deep talent pool that includes some of the most qualified professionals in the world. In other words, Latin American nations offer access to talent that might not even be available in your local area within the US.

7. Strong Infrastructure

Without a strong infrastructure, a robust IT industry is impossible. Successful software development initiatives require reliable Internet connectivity, plenty of electricity, and other resources. Latin American nations have made great strides toward creating some of the strongest information technology, electricity, and communications infrastructure globally. What does that mean to you? Simply put, it ensures connectivity, reliable communications, and the ability to collaborate with your outsourced team with ease. 

8. Cost Advantages and Beneficial Tax Policies

We now come to one of the most common reasons for outsourcing in the first place – cost savings. Latin American nations offer a lower cost of living, which translates to significant savings for US-based companies when it comes to software development and other IT projects. For instance, you might pay $100 per hour for necessary expertise in the domestic market, but the same skills will only cost around $55 per hour in Latin America. 

There is also the fact that the US dollar has strengthened significantly against Latin American currencies. This fosters even more significant financial savings for companies seeking software development services. The cost savings don’t stop there, though. 

 Many Latin American nations have modernized their tax systems. While this makes them more complex, it does mean that there are substantial advantages for preferred nations, project types, and the like. 

9. Major Anchors

Finally, you will find that Latin American nations are used to working with US-based companies, and there are major anchors in place. For instance, both IBM and HP maintain strong ties to Latin America, as do numerous other major US-based companies. If big firms can trust their success to Latin American partners, you can, too.

Choosing the Right Outsourced Partner

As you can see from the information above, there are many compelling reasons to consider outsourcing software development to Latin America. However, there are challenges that you’ll face here, including finding the right partner. A few tips will help ensure that you’re able to choose the best partner possible.

Know Your Requirements

The first thing you must do is know your requirements. What are you attempting to accomplish? Any constraints and limitations? What are your overall goals, and how will you know if a project is successful?

Don’t Choose Based on Costs Alone

While saving money is one of the primary reasons for choosing to outsource software development in the first place, you should not choose your partner based solely on cost. Remember – you get what you pay for, and budget options can often lead to subpar results. That doesn’t mean you should pay exorbitant amounts, of course. Simply put, you need to compare your options based on multiple factors to make an informed decision.

Get to Know the Team

Before signing a contract or agreeing to anything, get a good feel for the team. What is their communication like? Do you work well together? What credentials does the team leader have? What credentials do the team members have? Does the team deliver the level of expertise that you need for this specific project?

Dive Into Feedback and History

It’s difficult to answer the question, “which outsourced software development company is right for me.” One key to making an informed decision here is to check out the team’s history and client feedback. Has the team developed software similar to what you need? How did those projects go? Where there cost overruns? Was additional time required? Did the company deliver to the client’s expectations? Would the client hire the team again? These are just some of the essential questions you’ll need to answer here.

What Is the Development Process Like?

While you certainly want a streamlined experience, the development process you experience must match your project’s requirements. This is particularly true when it comes to Agile development. Because “agile” is thrown around by many different companies today, you’ll need to look for context clues, such as the terms SCRUM and DevOps development, to tell you that you’re actually dealing with an Agile developer.

Why Work with Softrizon?

At Softrizon, we believe that an ideal partnership between client and software developer requires mutual understanding, transparency, and direct communication. We bring those qualities to every project we undertake. We’ve worked with clients large and small to solve their software development requirements using top 5% talent from Latin America, and we’ve created some truly amazing things. We would love the opportunity to do the same for you. Contact us today to schedule your no-cost consultation. 

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