Why is Ukraine a perfect place for outsourcing

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15
Mar

Why is Ukraine a perfect place for outsourcing?

Ukraine is the best place for you to employ any ideas in Web and Mobile software. Thanks to its abundance of highly-skilled engineers, the country has become a leading software provider in Europe. Ukraine software development companies offer a rich list of advantages that can be divided into four groups: location, labor pool, work approach, and national mentality.

We’ve researched each of these benefits in order to get to the essence of outsourcing software development market in Ukraine!

Ukraine’s IT outsourcing sector has been booming for over two decades. The benefits of contracting out software development and QA/testing to this Eastern European country have long become clear: you get to tap into the extensive pool of world-class engineering talent and enjoy fairly cheap rates. In fact, US, Europe, and Asia based tech giants are so taken with Ukraine’s IT potential that many of them, such as Cisco, Oracle, and Samsung have opened their R&D centers there.

Like any business initiative, there are risks. Generally, businesses that outsource technical services to Ukraine find these risks manageable and mitigateable. Our experience is that businesses are very frequently satisfied working with Ukrainian IT vendors.

Ukrainian location

Suitable time-zone – Ukrainian time-zone is only one hour ahead of European countries and intersects with Australian and American time-zones, so you can get in touch with outsourced developers team with no impact on your own working schedule.

In other words, Ukraine’s location allows better operational monitoring and gives ease of communication and project control.

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Recruitment capabilities – The absence of strong legal restrictions or trade unions makes Ukraine one of the Top 3 outsourcing destinations.

Ukraine is recognized as one of the best countries to outsource Web & Mobile development. Despite all political instabilities, the Ukrainian software market is growing rapidly. For now, it’s the only sector of the Ukrainian economy that is immune to the political and economic fluctuations. The sector is showing steady growth, that results in an increased number of jobs and salaries among the developers.

No rigorous visa requirements – Easy to apply and obtain a work permit/residence for foreigners.

Ukraine is the largest country located in Eastern Europe. As it located on the crossroad of the Europe – Russia – Central Asia – Middle East trade routes, the country appears to be an ideal place to establish a management center that controls entire business activity in the region.

Western orientation – Ukrainian software engineering industry is focused on the USA, European Union, and Australia market.

Major software development companies in Ukraine have a partnership with recognized brands and leaders in the Internet industry. They are cooperating with Microsoft, Skype, Deutsche Bank, Apple, Bosch, eBay, Dell, Microsoft, and IBM. More than a hundred global major tech firms conduct R&D activities in Ukraine that leads to cost savings.

Why Ukraine is the second Silicon Valley.

There are over 15,000 registered software outsourcing companies in Ukraine, most of them are integrated into the western business world. Visa and Uber invest in Ukraine and they tend to increase their influence on the market pouring latest electronics, marketing, and management trends into the country. Uber is even opening its office in Kyiv which is known to be financially attractive to international investors.

The professional workforce is the second major driver for the booming software products development in Ukraine. Proficiency and intelligence of the country’s engineers are the key elements for great results.

In 2018 there were over 185,000 tech workers, in Ukrainian IT market, which is 26% more than in 2017. By 2020, Ukraine’s software engineers pool is expected to surpass the 200,000 mark. According to SkillValue, Ukraine ranks 8th among the world's top countries with the best programmers with an average score index 91.26%.

Thanks to the high expertise of Ukrainian developers, the country retains leadership in Eastern Europe by volumes of orders in the region. Not to mention competitors: Russia, Poland and Belarus. The fact that 18 Ukrainian companies were included in the top-100 best IT companies in the world in 2018 speaks for itself.

Why Software Development in Europe Is So Expensive

First, it is necessary to define what we mean by “expensive”. After all, what is considered expensive for one company can be cheap for another. When we say that software development in Central and Western Europe is expensive, we mean that development costs are much higher compared to other locations such as Eastern Europe or Asia. Let’s review each cost factor in detail.

The key factor which makes software development expensive in Europe compared to other locations are the salaries. Let’s see the average salaries of software developers in the major European states:

In the UK, the median rate of a software engineer is £45.00 or $56.64 per hour.

In Germany, a software developer’s median rate is €20.13 or $22.75 per hour.

In France, this figure is similar, with €35,565 of median annual salary or approximately $23 per hour.

In Belgium, the median rate is €32.90 or $37.17 per hour.

In Switzerland, a software developer on average earns $150 per hour.

In Spain, the median hourly rate is €21.00 or $23.07 per hour.

It would be also interesting for some readers to see actual numbers for Scandinavian countries:

In Norway, the median rate for this position is $25.11 per hour.

In Denmark, this figure is slightly higher – $31.52 per hour.

In Finland, an average developer can expect to earn at least $17.25 per hour.

In Sweden, the median hourly rate is $27.27 per hour.

To compare, in Ukraine, a software developer’s rate ranges from $9.83 to $15.13 per hour. The average rate is $11.05 per hour or $24,652 a year. This is at least two times less than in Central or Western Europe. Therefore, by outsourcing to Ukraine it is possible to cut software development costs up to 60%. Taking this into account, it should come as no surprise why European clients choose Ukraine for outsourcing. Compared to its neighboring countries — such as Poland, Belarus, and the Czech Republic, Ukraine offers more competitive outsourcing rates paired with a much larger tech talent pool.

The average hourly rate for software development is within the $25–50 range, with the average software developer salary varying between $2,500 and $4,000 per month (excluding taxes and social contributions).

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