Colombia, a top software development destination in Latin America

6 reasons for outsourcing software development to Colombia in 2020

When one hears of Colombia, the initial thoughts are of rich Colombian coffee, the legend of Eldorado, and the beautiful, lively cities of Cartagena and Bogota, full of myriad attractions for tourists. However, Colombia, as a country, is now increasingly also known for the growing strength of its industries, especially the IT sector and software development space. You might be surprised that it is now a wise choice for US companies to consider offshore software development services from Colombia, but the country actually has a lot to offer in terms of outsourcing, such as talented and skilled multilingual developers, low cost of hiring, and more.

Advantages of nearshore outsourcing to Colombia in 2020

Skilled professionals encouraged by growing education space in Colombia

Colombia has had a rocky past in terms of education as not much was invested by the government in this sphere, and the rates of literacy were quite low. However, over the past decade, the Colombian government has been working to reduce disparity in male-female ratios of education, and as of 2017, the number of doctoral graduates in engineering courses was considerably significant, at 29.5%, ranking first out of 45 countries considered for the list. Moreover, in terms of children’s attendance for primary education, Columbia has one of the highest rankings in South America, and in 2016, a gap of 5% in student enrolment was recorded to exist between each of the five socioeconomic groups in Colombia, a great improvement from the past.

In addition, to support tertiary educational needs, Colombia also has some very good universities such as the National University of Colombia, and technology-specific courses offered by tech universities such as the Technological University of Pereira and the Pedagogical and Technological University of Colombia. As such, graduates from these universities grow into skilled IT professionals, encouraged to explore the field of software development further by the growing tech space in Colombia. Thus, if you wish to hire overseas programmers from Colombia, rest assured that a talent pool here can offer highly skilled and capable software engineers, as well as responsive and eager to counter any challenges faced during work projects.

Thriving infrastructure supported by increasing FDI to the Colombian IT sector

Colombia is known to be the third-largest supplier of IT services among Latin American countries, with the IT industry in 2015 enjoying a high record of exports — as much as USD 60,558,280,37. As such, the Colombian IT sector has experienced tremendous growth as global demand for services such as application development, game development, mobile app development, and other custom software products has gone up, and Colombia has been efficient in producing the same to cater to this need. The industry has also been helped by Foreign Direct Investment from countries like the United States, investment, which is encouraged greatly by Colombian tax law that exempts foreign investors from having to pay Value Added Tax (VAT).

Colombia today is home to more than 5000 tech companies, and Forbes has listed some such as Brash 3D and GreenSQA among others as top Colombian tech companies to keep an eye out for because of the amazing innovation they have shown. Thus, Colombia really has a fantastic and continually growing tech infrastructure in place to support an increasing number of tech talent in the country and generate thousands of jobs. For companies seeking offshore software development from Colombia, this is indeed very good news and proves why Colombia is a great destination for outsourced development.

Minimal time difference between Colombia and the US = swift response

Many US companies don’t prefer countries located in Asia because of the huge time gap of 10-12 hours, as the response time and therefore development process would be slow, and there might be a major delay in project delivery due to that. Colombia offers an advantage here, as the country is only an hour behind the US in terms of a time zone. This way, when you hire software developers from Colombia for your US-based company project, you will find that the response time is really less, and the developers can work in tandem with you because of the close time zones. This basically ensures that there is no wastage of time and hence of resources and effort, important queries and/or issues can be resolved swiftly, and the project will be finished in time — all of which are factors companies look for whenever they seek software outsourcing.

High retention of Colombian developers

The Colombian IT sector is growing and thriving currently, which makes it a rather happening industry to work in. Perhaps this is why developer retention is fairly high in Colombian tech companies, which is nothing but good news for US companies considering outsourcing software development to Colombia. This is because higher developer retention means that the developers tend to stick around in the same software development teams or companies for a long while and that in turn ensures that when you hire a team from Colombia, you will most likely have the pleasure of working with the same team through the entire project. This is a major plus because, in such a case, there is absolutely no loss of knowledge, and no time is wasted in communication and explanation, which would otherwise have definitely happened if the team of your partner outsourcing company changed in the middle of the project.

It’s remarkably easier to work with the same team for the entire duration of the project because you end up getting used to those people and develop a relationship with them. Getting to work with the same team of developers also ensures that you get the chance to bond with the developer team and get the most out of the remote outsourcing experience.

Professional quality of work and multilingual developers of Columbia

Quality of work is always something companies worry about when they outsource it. However, in Colombia’s case, that is not at all a concern, since Colombian developers are absolutely professional and are always ready to solve challenges. The Colombian work culture, driven by an enthusiastic, energetic approach to problem-solving, is very similar to that of the US, which makes it a smart choice for US companies to hire software developers from Colombia.

Another factor that often worries companies about outsourcing to Latin America is whether the engineers from software development companies will be able to speak English or not. However, Colombia has been encouraging its developers to learn English, so that this multilingualism can help them be more eligible to be chosen for outsourcing. Thus, communication won’t be a challenge with Colombian developers, and neither will the quality of work.

What’s more, when you choose to hire remote development teams from Colombia through YouTeam, you can choose which development team you want to work with based on their profiles and how well you think they would work with you. This gives you more confidence in the team you will be working with, and lets you get a good idea of their capabilities before you commit to hiring.

Comparatively low cost of hiring 

Cost is often a major concern for any company when it is time to hire. Hiring a developer in-house would be pretty costly for most US companies, but hiring a developer from Colombia is not half as expensive even with expenses like bonuses added in. There is a definite cost benefit in hiring developers from Colombia as opposed to hiring within the US. Currently, the average salary drawn by a software developer in Colombia is around COL $44,697,990 (USD 11,784), whereas the average US developer earns USD 71,508, which shows that there is a significant cost difference. Although Colombia’s economy has been growing slowly but steadily, the market is still not so competitive, so the cost of hiring is still low. The benefit of this low hiring cost is twofold — not only do you have to pay less to hire Colombian developers; you also get the same professional quality software engineering from them that you would expect from a developer in the US. Thus, the cost-benefit is a sure advantage to hiring software developers from Colombia.

What to watch out for choosing software  outsourcing to Colombia

Colombia is indeed a very good choice for US companies looking for outsourced development, but there are a few specific elements a company must consider before going for offshore software development from Colombia or any other country, for that matter. Before you invest your valuable time and money in hiring outsourced teams, here are some key points to keep in mind.

  • Before hiring, it is a good practice to go over the developer’s profile carefully, take a look at all the work they have done till now, and, if possible, seek some reviews of the developer’s work that previous clients might have given. This will give you a good sense of the developer’s skills and whether they would add value to your project if you hired them, and then you can make a better-informed decision.
  • For any remote development project, delivery dates and timelines are of utmost importance. Before hiring, ensure that you put all the time and date related details on the table: when you will be expecting the project delivery, timelines for each part of the project, etc. That way, miscommunication is avoided, and both sides are clear on what is expected with regards to timelines and milestones.
  • Since you are hiring the developers for a technical purpose, it is a good idea to have a technical person on your side as well. This person can look into the technical details and make sure the developer will do the right job, thus saving you loads of time and money as well as effort. If you skip out on this and set this role to a non-technical person, be prepared for unnoticed errors to slip through and ruin at least some of your hard work on the project. It is much wiser to have the technical expert present throughout the process.

Now, even after following these pointers and completing the hiring process, there are a few more things to watch for before and during the project.

  • It is advisable to have open and frequent communication throughout the project with the development team. Continuous communication and collaboration will help you understand the developers’ needs and will also help you and your teams convey what you need to the developer team accurately.
  • Remember the timelines you fixed earlier before the project with the developer team. It may sometimes happen that there is some unforeseen crisis that causes a delay in delivery, but you must emphasize the importance of immediately conveying to everyone else in the project that there has been such a delay. This will avoid confusion in the long run and will ensure that both your side and the developer team are up to date with each other’s progress.
  • After you hire remote development teams from Colombia, it is important to retain the technical expert you had with you during the hiring process. Not only will this expert be able to supervise the developer team’s work and keep track of the progress in the project, but they will also be able to spot any errors in the work and get them addressed accordingly, so the project doesn’t suffer any loss.

Whenever a company hires outsourced teams from other countries, the above points are bound to come in handy, even though Colombia, as an outsourcing destination, is very reliable and produces top-quality professionals. Meanwhile, remote outsourcing, in general, has some of its own disadvantages, just as it has benefits. Similarly, outsourcing software development from Colombia also has a few disadvantages.

Disadvantages of offshore software development in Colombia

At the outset, when it comes to outsourcing and countries that export outsourcing services, each nation has its own set of pros and cons. For example, India was valued greatly in the early 2000s for the high quality and speed of work provided by outsourced teams. However, some scams in major companies in the Indian IT sector, and complaints of data theft led to a significant decline in India’s popularity as an outsourcing hub. Countries like Colombia are on the rise in this aspect as Colombia, in particular, offers attractive benefits to US companies for outsourcing. However, there are some disadvantages and possible difficulties one should prepare for when planning to hire software developers from Colombia.

While labor and trade unions in Colombia have faced a decline in the past two decades, there are still several employee unions that might disrupt the process of US companies hiring outsourced developers from Colombia, as many are opposed to outsourcing because of the often low pay scale it offers. US companies wanting to hire Colombian developers should beware of the possible intervention of these unions, and steer clear of them as much as possible.

Another thing US companies should be aware of is the myriad labor laws in Colombia. Contractual labor and fixed-term employment are both permitted by Colombian law. Still, the terms regarding renewal and re-hiring are quite different and must be understood well before actually hiring Colombian developers.

These difficulties don’t apply to companies hiring via the YouTeam platform. Because in this case, companies partner with a software development outsourcing company (which takes care of all issues related to hiring engineer) and YouTeam (which takes care of legal, payment, and communication issues).

Apart from these difficulties, Colombia in general, despite demonstrating economic growth and reaching new fiscal targets, is a country of haves and have nots. There is a lot of growing political instability in the country due to this disparity between the wealthy and the poor, which is quite stark, and unemployment appears to be on the rise. These factors might present a potential problem to US companies looking to outsource as well, although it is not yet an issue currently — it still helps to be prepared and know what you’re investing in finally. These difficulties aside, Colombia is otherwise a reliable country to hire developers from, for US companies.

Key takeaways

There is no denying that there are many attractive choices for US companies seeking outsourced development work, but Colombia is definitely one of the best options to choose from. Apart from a skilled and talented pool of development professionals, the growing focus on strengthening IT infrastructure and the reduced time zone difference which makes real-time collaboration easier, the lower cost of hiring is also a good reason to hire overseas programmers from Colombia.

    • A growing number of skilled professionals supported by education. The education sector of Colombia has experienced significant progress and growth, creating more opportunities, and encouraging the skill-building of young students and professionals.
    • Focus on technology and infrastructure. Colombia’s tech space is growing rapidly as global interest in investing in Colombia’s IT sector also grows, thus encouraging lots of budding software developers in the country.
    • A minimal time difference allows maximum collaboration. Colombia is only one hour behind the US, which allows quick real-time responses and communication during the project and avoids wastage of time.
    • The high rate of developer retention. Since developer retention in the Colombian IT sector is high, there is less chance of the developer team changing during your project with them, and more likelihood of having the same team throughout.
    • High-quality work and multilingual developers. The quality of development work you receive from a Colombian developer is at par with US standards, and the fact that Colombian developers can speak English well is an added benefit.
    • Comparatively lower costs. As a company, you have to pay Colombian software developers much less than the cost you would incur if you hired US-based developers instead.

To make an informed decision about offshoring to Colombia, spare a minute to read about outsourcing to other Latin American countries: MexicoBrazilArgentina, Chile, Costa Rica, and Uruguay.

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Written by
Svetlana Shevchuk

Digital Marketing Specialist at YouTeam, a Y Combinator-backed marketplace for building remote dev teams.

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