Explore Argentina's potential as a destination for your software development outsourcing. Discover the technological talent, language proficiency and competitive prices.
Argentina has an evolving software development sector. Companies continue to outsource software development to Argentina, where they benefit from top-notch services, seamless communication, and expertise.
Understanding Software Development Outsourcing
There is a growing shortage of software developers, leading many companies to expand their search for highly qualified technology professionals. As software development is one of the most critical processes for companies in the IT sector, it is important to find the best developers who guarantee the production of quality products.
High demand for talent coupled with low supply makes it difficult for companies to find affordable software developers, which is why many companies choose Argentina and other Latin American countries for their software development outsourcing needs.
Despite its history of conflict, Argentina has matured and become a major technology center with all the infrastructure and resources to support software development at an international level. Heavy investments in education have allowed for better training of highly qualified developers. Companies that choose Argentina for their outsourcing needs get access to these developers at significantly low prices – but there's more to the country than low costs.
What is software development outsourcing?
Software development outsourcing is a business model in which a company hires an external service provider to work on the technical aspects of a project. Outsourcing is a very common approach to hiring software engineers and other professionals across industries.
This is not surprising given the many advantages of outsourcing software development. Companies of all types and sizes use this practice to build innovative and competitive solutions, even if they don't have adequate resources or an in-house software development team. Outsourcing also allows companies to focus on core business tasks, manage business operations, and maintain existing software for customers.
Outsourcing companies also offer clients several options depending not only on engagement models but also on the location of the development company: onshoring, offshoring and nearshoring.
Onshore outsourcing is the process of working with an external software development team located in the same country as the client company. Development costs depend on the country's hiring and living costs, but as there are no language or time zone barriers, the closer location makes communication easier.
Nearshoring involves outsourcing to neighboring countries. Depending on the location of the client company, this solution often combines reduced or non-existent language barriers with low hiring rates.
Offshoring involves working with third-party suppliers from other countries around the world. Due to low labor costs, this is the most economical option. The downside to offshoring involves the potential for language barriers and very different time zones, causing potential communication issues.
Benefits of Software Development Outsourcing
Software outsourcing is a common practice across industries due to its many benefits. Nowadays, companies that don't take advantage of this practice often have difficulty standing out from their competitors. Some of the key benefits of software development outsourcing include:
- Global talent pool – Outsourcing allows companies to choose from the world's best software developers at affordable prices without compromising product quality.
- Focus on essential business tasks – Rapid access to global technology talent allows companies to focus much more of their time on essential business tasks that generate revenue and increase growth and productivity.
- Cost Reduction – Outsourcing software development allows companies to save money by not having to invest in full-time hiring and recruiting costs. Companies tend to choose suppliers from countries where the costs of hiring software developers are much lower.
- Faster time to market – Outsourced developers typically have extensive experience in their field, which translates into an agile development process. Its efficient methodologies allow projects to be completed even before established deadlines, reducing the company's time to market.
- No need for micromanagement – Many outsourced software development teams have a dedicated project manager who monitors the entire development process and builds the bridge between the team and the client company. Either way, you can count on experienced professionals to deliver high-quality software – no micromanagement required.
- Scalability – Companies can increase the number of outsourced team members working on their projects as their requirements change over time.
- Flexibility – When outsourcing software development, the relationship between the client company and the supplier is flexible. You can adjust your template or contract according to your needs.
- Access to the latest technology – To keep up with the latest trends, companies need constant access to cutting-edge technology. Outsourced professionals are well-versed and experienced in their fields and leverage the power of many technology stacks to create innovative solutions.
Why outsource development to Argentina?
Companies choose Argentina for software development outsourcing due to its thriving technology industry and high-quality talent pool. Software development outsourcing services in Argentina are cost-effective and offer time zone compatibility with the United States.
Argentina's thriving tech industry
Argentina has a thriving IT and software sector that is constantly growing. According to Technávio between 2022 and 2027, experts expect Argentina's IT market to develop at a compound annual growth rate of 8.3%, with a market expansion of US$6,689.71 million.
Argentina fosters a great culture of innovative thinking and the software development sector continues to grow steadily as programming, software engineering and development continue to be in-demand skills.
Argentina is home to several upcoming and developing technology parks. Some of them include Catalinas Norte and the Centro Tecnológico do Litoral SAPEM Park. These hubs have a strong focus on R&D, technology transfers and business incubators. These companies encourage companies to engage in technical innovation and exchange ideas and business knowledge.
The Argentine government understands the importance of the technology industry and contributes to its growth with tax deductions and training incentive campaigns. With women comprising more than 45% of technology job candidates in Argentina, the industry continues to empower a diverse workforce.
High-quality talent pool
Companies also choose Argentina as an outsourcing destination due to the high-quality talent pool available. The country has invested heavily in schools and universities, mainly to increase access to education for people of all socioeconomic levels.
Currently, there are two Argentine universities listed among the top 30 global universities in the Latin America region . The University of Buenos Aires and the National University of La Plata stand out for the excellence of their teaching programs in Computer Science.
The large number of qualified students leaving universities every year, combined with the government's efforts and investments to support higher education, strongly encourages companies to choose Argentina to outsource software development.
Argentine software developers are proficient in coding languages such as Python, TensorFlow, SQL, and R. Some of their key technology skills include web development, UX/UI design, cybersecurity, IoT, APIs, AI and ML, and convolutional neural networks.
Economic services
Companies choose Argentina to outsource their software development because the country offers cost savings while ensuring access to high-quality products and a thriving software industry. There is a significant exchange rate difference between the United States and Argentina. In 2023, one Argentine peso (ARS) was worth less than one cent on the dollar. The lower value of the Argentine currency is linked to lower wage rates in general.
Some other reasons contribute to the accessibility of software developers in Argentina. Because there are so many software developers in the country, the field is more competitive, which translates into reasonable hourly rates for development.
The cost of living in Argentina is also significantly lower than in the United States. Because of this, Argentine software developers generally do not demand the same fees. Additionally, outsourcing to Argentina saves companies expenses such as labor taxes, social security payments and benefits.
Of course, different levels of specialization and different skill sets always affect the final cost of hiring software developers from Argentina. For example, in areas such as C# development, the difference between Argentina and the USA in terms of salaries is sometimes very significant. Other fields, such as PHP and React development, may translate into smaller fee differences. Still, the difference between the two countries is very noticeable.
Time zone compatibility
Time zone compatibility between Argentina and the United States is another factor that leads companies to turn to Argentina for their software development needs. This country is only 1-3 hours ahead of most major US cities. Because software development teams from both countries can work at the same time, Argentina is an excellent destination for nearshoring.
This time zone compatibility is invaluable. Real-time communication and collaboration, without gaps or delays, translates into shorter response times, faster problem resolution, and faster project completion. Time zone overlay helps speed up the entire development process.
Successful software development outsourcing to Argentina
To ensure that companies have successful relationships with their outsourced software development teams in Argentina, they should take the time to consider a few important steps. Choosing the right outsourcing partner is crucial to ensuring the best results. It is also necessary to establish clear quality and safety expectations, milestones and measures.
Choosing the Right Outsourcing Partner
Companies must go through a selection process to find and choose the right outsourcing partner in Argentina for their software development project. The first step is to perform a thorough background check on the outsourcing provider. Business leaders should verify that the vendor has the experience and skills needed to complete the project, as well as access to the best infrastructure and technologies. They should investigate the vendor's reputation, analyze customer reviews and testimonials, and request portfolio samples.
To get more honest reviews and ratings, companies can research potential outsourcing providers on third-party websites. Conducting interviews with supplier representatives is another way to assess the quality of communication. It is also good for determining whether the outsourcing vendor shares the same business values as the client company.
Setting clear expectations and milestones
Companies wishing to outsource development to Argentina should make their expectations clear to their IT outsourcing partner. By the time companies select an outsourcing partner, they should have a good idea of the project's objectives, deadlines, and budgetary requirements.
Companies must inform their suppliers exactly why they outsourced development, what they want to achieve and how much they are willing to spend to still achieve cost savings. The best way to do this is by creating a project plan and schedule. The company must detail specific tasks, milestones and deadlines for each development phase. The plan should also include specific instructions for developers and a communications strategy.
Non-technical business leaders should enlist the assistance of a technical expert to help them convey project requirements and specifics to help prevent misunderstandings and critical errors from occurring in the future.
Ensuring Quality and Safety
In general, when outsourcing, companies need to establish a plan to ensure quality and safety. They could start by creating a checklist containing all the items that require adequate testing before project delivery with the help of their outsourcing partner.
Companies should also look for outsourcing providers with relevant certifications. The ISO 27001 certification, for example, means that the supplier adheres to international information security management standards.
In addition to choosing a third-party partner with established security protocols and data access controls, the best way to ensure security is by creating strong legal contracts that protect both parties by defining expectations for data security, confidentiality, and liability for non-compliance. They could also include the right to terminate the contract in the event of a critical data breach or if the vendor fails to comply with any type of security requirements.
The different outsourcing models
Another important factor to consider when outsourcing to Argentina is the fact that many suppliers allow companies to choose between different outsourcing models depending on their needs and requirements.
Outsourcing development
Software development outsourcing involves a client company fully delegating an entire project or series of projects, from start to finish, to an outsourcing provider. In this outsourcing model, the supplier is responsible for managing the project and offering the necessary resources, including personnel, equipment and infrastructure. The outsourcing provider is also responsible for the results.
There are several benefits associated with outsourcing development. In this model, the vendor handles project management and there is little to no training required for the outsourced team to complete the project. It's easy to scale development teams whenever requirements change, and there's no additional management overhead of adding employees. This outsourcing model also allows in-house employees to focus on the core tasks and needs of the business.
Software development outsourcing is the best option for companies that need to meet tight deadlines and manage daily core business tasks at the same time during project completion.
Staff increase
The IT staff augmentation model allows companies to augment their in-house development team with some outsourced experts. Business leaders manage these professionals according to their internal methodologies, while filling a specific skills gap and adjusting to business conditions.
Staff augmentation is cost-effective considering companies only pay for the development services delivered, allows for rapid onboarding of experts, and provides more internal control over the project.
Companies use this outsourcing model because it allows them to find resources quickly. They can also decide on the number of employees required, their qualifications and the roles each of them will play throughout the development.
However, despite the many benefits of staff augmentation, this model is not suitable for all projects. It's a good choice for companies with in-house staff and well-established management that require developers with solid technology stacks – some of which are difficult to find on the market – to meet tight deadlines.
Dedicated Teams
When hiring a dedicated software development team, companies work with a third-party vendor who provides them with a development team that works exclusively on their project. The client company plays a leading role in composing the team and selecting suitable candidates for each role according to the project requirements.
While dedicated staff often communicate and work under the direction of the client company, they are ultimately the responsibility of the outsourcing vendor. The vendor takes care of compensation, taxes, insurance, equipment, software licenses and any other expenses, while the company simply pays for the work itself.
Hiring a dedicated team reduces overall costs, allowing companies to avoid the additional expenses of hiring an in-house team. Team members are fully dedicated to the project at hand, and it's easy to scale the team as needed to help speed up the development process.
Dedicated teams are an outsourcing model suitable for a variety of businesses, from complex long-term projects without defined requirements to early-stage startups or companies that require long-term cooperation and work in a narrow development niche.
Other Great Outsourcing Locations in Latin America
Many companies outsource software development to Argentina. However, there are many other options when it comes to outsourcing in Latin America. The Latin American region has a lot to offer. Companies often see it as a preferred outsourcing destination for cost-effective solutions.
Chile
Many companies outsource software development to Chile because it is a center for technological innovation. Some of the main reasons why companies choose this country for outsourcing include access to highly qualified software engineers and low costs.
The country presents significant developments in several IT areas, such as the Internet of Things, big data, sensor applications and much more. The government understands the importance of software development and the impact it has on the country's economy.
Mexico
Due to the similar time zones between Mexico and the United States, many companies choose to bring software development closer to the neighboring country. Mexico has the second largest talent pool in the Latin American region. It is also an engineering hotspot, a global industrial center and a source of affordable yet highly qualified professionals.
Some of the services commonly outsourced to Mexico include software development, customer service, graphic design, and application programming. There are multiple government initiatives in place to boost the IT sector, as well as high standards of education.
Mexico shares 13 Free Trade Agreements with more than 45 countries around the world, has an advanced infrastructure for software development, and has a low employee turnover rate.
Colombia
Companies also choose to outsource software development to Colombia thanks to its emerging market economy for business outsourcing. Low average costs for software developers, a growing tech talent pool, and a strong start-up scene make Colombia attractive as an outsourcing destination for software development.
The Colombian government has begun to cultivate a high-quality development environment through the Ministry of Science, Technology and Innovation. Now, Colombia has a strong ecosystem of universities and technological research institutions.
Argentina: an attractive destination for offshore software development
Argentina is quickly establishing itself as a hotspot for software development services. This evolving technical hub is filled with talented professionals equipped to provide businesses with high-quality, competitive software products at affordable prices. Many foreign companies are recognizing the advantages of partnering with a software development company in Argentina, thanks to its thriving technology industry, high-quality talent pool, and cost-effective services.
Due to the minimal time difference between Argentina and most US cities (just one to two hours), many technology companies see Argentina as an ideal nearshoring destination for their software developer outsourcing needs.
The Latin American region is not limited to Argentina when considering offshore software development. Other prominent locations include Chile, Mexico and Colombia, each bringing unique strengths to the global software development market.
Common questions
How does Argentina compare to other Latin American countries in terms of software development outsourcing?
Argentina is continually ranked among the top countries in terms of technological skills across the world. The country has highly qualified professionals, with talents ranging from software engineering and operating systems to specialized niche technologies. Two Argentine universities, the University of Buenos Aires and the National University of La Plata, also appear listed among the top 30 global universities in the Latin American region.
What are the potential challenges when outsourcing to Argentina?
Outsourcing to Argentina brings with it a set of challenges. Foreign companies should be aware of potential bureaucratic obstacles and the presence of several unions that advocate strict standards of working conditions. Historic economic volatility in Argentina may also give some investors pause.
However, the myriad of benefits – ranging from cost-effectiveness and top-notch technical education to high-caliber results – generally make Argentina a preferred destination for offshore software development.
