Onshore Software Development: Costs, Pros, Cons & More

5 Jan · 5 min read

Onshore Software Development: Costs, Pros, Cons & More

To stay ahead in the digital world, outsourcing is becoming a popular practice relied upon by multiple start-ups and large enterprises. The concept has gained massive traction in the past few years as a way of increasing productivity and cost efficiency. According to Research and Markets, the global IT outsourcing market is expected to reach US$ 633.6 million by 2027, with a CAGR of 3.7% from 2020 to 2027. And these high statistics will continue to rise without further doubt in the upcoming years. However, there are various types of outsourcing, and the main challenge most companies face while outsourcing is finding which one would be the appropriate model for them (onshoring, nearshoring, offshoring, or multisourcing). Let’s understand one of those models, i.e., onshore software development, in great detail via this article. 

Let’s get started! 

Onshore software development, commonly termed "local outsourcing," happens when you outsource software development to a company that is in the same country as your business. For example, if your company is in the USA (same city or state) and you are outsourcing software development to another company located in the USA, this is what we call "onshore software development." 

The main objective behind choosing an onshore outsourcing model is to get the most out of every benefit associated with adopting an onshore software development service. Just like two other outsourcing models, onshore software development also comes with its own set of pros and cons. All we need to ensure is to understand every aspect and come up with an informed decision wherever possible. 

Pros and Cons of Onshore Software Development


Here are a few benefits of onshore software development:  

1) Easy Communication: 

The biggest advantage of choosing onshore software development is the ability to communicate freely without any language barrier. Also, it is easier to maintain smooth communication with developers in the same time zone, which makes it easy for them to stay on the same page with your team and make quick decisions.

2) Less Cultural Differences

Cultural differences are one of the major concerns when it comes to offshore software development. That is why, to avoid these differences, companies consider onshore outsourcing as an appropriate option. In fact, it is always necessary to consider cultural compatibility and ensure fruitful collaboration between teams.

3) Ensuring Security 

Onshoring outsourcing offers more security and efficiency as compared to other outsourcing models. You no longer need to worry about sharing your sensitive information with another company, as the team will be based in your own country and operating under the same laws and regulations.

4) Access to Best Expertise

Onshore outsourcing provides easy access to software developers with strong technical skills. You can easily collaborate with them and meet them in person to discuss all the updates and progress related to the software development project.


1) More Expensive 

Onshore software development is more expensive as compared to offshore software development. This is mainly because you are outsourcing based on your convenience in your country and a similar time zone.

2) Limited Talent

Outsourcing software development to onshore developers will limit your access to a diverse pool of talent. There are strong chances of a lack of talent. However, searching for talent across borders will open doors to more opportunities.

How Much Does Onshore Software Development Cost?

Onshore software development services can be quite expensive as compared to other outsourcing models, especially if your company has a limited budget. The cost of onshore development services starts at $30 per hour, which is supposed to be four times higher than that of offshore development services, which vary from country to country. 

Companies often opt for onshore software development due to the convenience of time zones and the lack of cultural and language barriers. But the cost factor associated with onshore software development services makes them think twice before making an informed decision. 

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When Should You Choose Onshore Software Development?

Every outsourcing model comes with its own set of advantages and disadvantages. Onshore software development comes with various advantages, such as high-quality work, no language, and cultural barriers, better privacy, and so on. But then again, cost is a major drawback in the case of onshore outsourcing. However, you must go for onshore software development when you are dealing with large and complex projects that require more time and better collaboration. 

Prioritizing transparency and open communication before outsourcing your software development project will lead to fewer communication delays and project misunderstandings. The ultimate objective is to connect with the right team with the desired expertise in order to get the best out of your project. It is always advisable to consider all the know-how of the project before choosing a specific outsourcing model and making your final call. 

Key Takeaways

In times when outsourcing has become a go-to option for businesses, choosing the right onshore software development company is no less than a challenge. You can always crack the nut with the right pricing strategy, a skilled team, closer time zones, open communication, and, of course, the right outsourcing model. The consultants at Amplifyre can help you opt for the right onshore software development company at affordable prices with the help of their unique data-driven matching system and global pool of vetted software companies. 

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