This is why nearshoring is the strategic choice for outsourced software development

When it comes to software development, Dutch organizations are continuously looking for ways to increase capacity, control costs, and gain access to top IT talent. Outsourcing is a proven strategy to achieve these objectives, and within this domain, nearshoring has been gaining popularity in recent years.
The reasons behind this trend are explained in the blog article below.

Before we discuss nearshoring in detail, it is important to first understand what outsourcing actually means. Outsourcing involves delegating tasks and/or processes to external parties. This can range from simple administrative tasks to complex software development. Within the field of outsourcing, we distinguish between three variants: onshoring (outsourcing within the same country), nearshoring (outsourcing to nearby countries), and offshoring (outsourcing to distant countries).

What is offshoring? 

Offshoring refers to the outsourcing of software development to countries that are often geographically distant from the client, such as India, China, or the Philippines. The primary motivation for offshoring is typically cost reduction, as wage levels in these countries are lower than in Europe.

Despite the advantage of lower hourly rates, offshoring also comes with several significant drawbacks:

• Time difference: Collaboration with teams in different time zones can hinder communication and coordination.

• Cultural barriers: Differences in work culture, communication styles, and expectations may lead to misunderstandings and slow down processes.

• Security and regulations: Compliance and data protection can be more challenging, especially in potentially politically unstable countries where regulations differ significantly.

What is nearshoring?  

Nearshoring is the outsourcing of tasks such as software development to a nearby country, such as Romania, Poland, or Bulgaria. The advantage of nearshoring is that it combines the benefits of offshoring with greater control, improved collaboration, and closer cultural alignment.

Advantages of nearshoring compared to offshoring

Although offshoring, the outsourcing of work to more distant countries, has been popular in the past due to potentially lower costs, nearshoring offers a better balance between cost savings and other crucial factors:

1. Geographic proximity and time zone: One of the most significant advantages of nearshoring is the minimal time difference with the Netherlands. This results in simpler and more efficient communication, real-time collaboration, and faster feedback loops. Unlike offshoring, where significant time differences lead to delays and scheduling challenges, nearshoring allows Dutch companies to work almost synchronously with external development teams.
2. Cultural similarities and English proficiency: European countries generally share more cultural similarities than countries in, for example, the Far East. This facilitates collaboration, reduces misunderstandings, and fosters better team spirit. In addition, English proficiency within Europe is generally very good, which significantly simplifies communication with Dutch teams.
3. Short travel distance and personal contact: The relatively short travel distance makes it possible to maintain easy and frequent physical contact with the nearshore team. Visits to local development teams enable Dutch clients to meet the teams, discuss progress, and strengthen cooperation. This personal contact builds trust and improves mutual understanding, which is often more complex and costly with offshoring.
4. Intellectual property and data legislation: Within the European Union, strict laws and regulations apply regarding data protection (such as GDPR) and intellectual property. Collaborating with a nearshore partner within the EU offers Dutch companies greater certainty and legal protection than offshoring to countries with different legal frameworks.
5. Highly educated personnel: For example, in Eastern European countries, there is a strong focus on technical education and a high level of knowledge among IT professionals. Developers in these countries are highly educated, possess the latest technological expertise, and deliver world-class software solutions. Nearshoring enables your organization to access this expertise without the disadvantages associated with offshoring.
6. Similar work culture: The work culture and professional ethics in European countries are generally comparable to those in the Netherlands. This contributes to the smooth integration of the nearshore team with your internal processes and working methods.

Why choose nearshoring through NetRom Software?

Nearshoring offers a strategic alternative for companies seeking to leverage the benefits of outsourcing without the challenges associated with offshoring. By choosing nearshore software development with NetRom, Dutch organizations benefit from cost advantages, gain access to specialized talent working in a culture comparable to that of the Netherlands, while minimizing operational risks.

At NetRom Software, we combine the benefits of nearshoring with our extensive experience in software development for Dutch clients. We have offices in both Romania and the Netherlands. Our NetRom Campus in Romania offers:

• More than 500 experienced developers with a high level of expertise.

• Expertise across a wide range of technologies and industries.

• A proven track record of successful projects for Dutch companies.

• A strong focus on communication, transparency, and quality.

• A culture of collaboration and proactive engagement with clients.

• The possibility for easy and frequent personal contact.

• Compliance with European laws and regulations in project execution.

Would you like to know what NetRom can offer your organization in the field of nearshoring? Please contact us using the online form below. We will then invite you to a no-obligation conversation, during which we will provide information about our extensive capabilities for outsourcing software development through nearshoring.