App Development

Benefits of outsourcing app development: A complete step-by-step guide

28/05/2024

In today’s technological landscape, where digital transformation is a reality, finding the ideal application has become essential for business success. Mobile applications offer countless opportunities for business growth and user convenience. But is in-house development always the best option for your company?

According to a study by Avasant, 60% of companies worldwide choose to outsource app development to enhance their digital presence and ensure flexibility in customer experience. Additionally, according to Statista, global revenues in the app development outsourcing market are expected to reach $121.60 billion by 2024 and surpass a market volume of $129.90 billion by 2028.

In this article, we will discover how outsourcing app development can boost your strategy, offering benefits you might not have considered. We will analyze the different options available for outsourcing this service and break down the main reasons to consider outsourcing. We will also explore the specific benefits of outsourcing app development, such as increased innovation capacity, risk mitigation, and optimized development costs.

In-house app development vs outsourcing

In-house development

Definition: In-house development means that a company uses its own internal team to design, develop, and maintain mobile applications. This team may include developers, designers, testers, and other specialists necessary to complete the app development lifecycle.

Pros:

• Total control: The company has complete control over the development process, allowing for quick adjustments and real-time decisions without the need to coordinate with third parties.
• Internal know-how: All business and industry knowledge remains within the company, which is important for protecting unique ideas and technologies.
• Direct communication: Communication within the team is more fluid and direct, eliminating language barriers and time zone differences (if working with international teams).

Cons:

• High costs: Maintaining an in-house development team involves high costs in salaries, benefits, infrastructure, and ongoing training. Additionally, fixed costs can be very high regardless of the workload.
• Need for specialized talent: Attracting and retaining specialized talent can be a challenge, especially in competitive markets. The lack of personnel with specific skills can limit the company’s ability to innovate.
• Prolonged development time: Without the flexibility to quickly scale the team, projects may experience delays, especially if there are unforeseen absences or workload peaks.

Outsourcing

Definition: Outsourcing app development means that a company hires an external provider to manage the design, development, and maintenance of mobile applications.

Pros:

• Cost-effectiveness: Outsourcing can be more economical than maintaining an in-house team, especially when outsourcing to regions with lower labor costs. Fixed expenses are eliminated, and payment is made only for the necessary services.
• Access to specialized talent: Outsourcing companies usually have multidisciplinary teams experienced in the latest technologies and development methodologies, as well as expert knowledge of all stages of app development (conception, development, launch, maintenance, updates, and improvements). This allows access to a wide talent pool without the challenges of hiring and retention.
• Flexibility and scalability: It allows for adjusting the size of the development team according to project needs, facilitating the management of workload peaks and projects of varying complexity.
• Reduction of operational risks: The external company handles issues such as sick leaves, staff turnover, and training needs, freeing the hiring company from these concerns.

Cons:

• Less direct control: Outsourcing means that direct control over the development process is reduced. This can make it difficult to implement quick changes and perform daily supervision.
• Potential cultural differences: Working with teams in different regions may involve cultural and communication challenges. Differences in time zones and language barriers can complicate collaboration.
• Security and intellectual property risks: Sharing sensitive information with third parties can entail risks. It is crucial to have proper legal agreements and security measures in place to protect the company’s intellectual property and data.

Both options, in-house development and outsourcing, have their advantages and disadvantages. The choice between one or the other will depend on the specific needs of the company, the available resources, and the long-term goals of the mobile app development project.

Options for outsourcing app development

Freelancers

A freelancer is an independent professional who offers their services to various clients without being tied to a single company. Freelancers in app development are typically developers, designers, or testers who work on a project basis or hourly rate.

Pros:

• Low costs: Hiring freelancers is usually the most economical option for app development. Freelancers have fewer overhead costs than agencies and can offer competitive rates.
• Flexibility: Freelancers can easily adapt to the specific schedules and needs of the project. Additionally, hiring freelancers allows for adjusting the development team according to the project stages, increasing or decreasing the number of workers as needed.

Cons:

• Lower management capacity: Managing multiple freelancers can be complicated, especially if the project requires close collaboration between several specialists. This can lead to a lack of consistency in the project’s development.
• Quality risks: The quality of work can vary significantly among freelancers. Ensuring that each freelancer meets the desired quality standards can be challenging and may require additional time for supervision and reviews.

Development agencies

A development agency is a company that provides design, development, and maintenance services for mobile applications and other platforms. Agencies usually have multidisciplinary teams that cover all phases of app development, from conception to launch and ongoing maintenance.

Pros:

• Multidisciplinary team: Development agencies have teams composed of developers, designers, testers, and project managers, allowing for an integrated and coordinated approach to app development.
• Proven experience: Agencies often have a portfolio of previous projects that demonstrate their capability and experience. This provides a higher guarantee of quality and adherence to established deadlines.

Cons:

• Higher costs than freelancers: Hiring an agency is generally more expensive than working with freelancers. Agencies have higher overhead costs, and their services usually reflect these costs.
• Less flexibility in some cases: Agencies may have strict processes and methodologies that might not be as flexible as freelancers in terms of adapting to rapid changes or specific client needs.

Outstaffing

Outstaffing is a model where employees belonging to another company (usually a development agency) work directly under the hiring company’s management, as if they were part of the internal team. The hiring company selects and manages the personnel, while the outstaffing provider handles administrative aspects such as salary payments and benefits.

Pros:

• Control over the team: Outstaffing allows companies to have greater control over the development team, similar to in-house development. The company can select and directly manage the developers, maintaining a high level of supervision and control.
• Flexibility in management: The outstaffing model facilitates adjusting the team according to project needs, allowing companies to scale the team up or down as necessary. Additionally, the external team can be integrated with existing internal teams, promoting closer collaboration.

Cons:

• Complexity in integration and communication: Integrating and managing an external team can be complex, especially if there are cultural or time zone differences. It requires establishing clear communication and management processes to ensure all team members are aligned and working efficiently.
• Dependency on the provider: Although there is control over the team, dependency on the service provider for hiring and managing personnel can be a risk. It is crucial to choose a reliable provider that ensures the quality and continuity of the service.

The choice between freelancers, development agencies, or outstaffing will depend on factors such as budget, project scale, the need for control and supervision, and the ability to manage integration and communication with the development team.

Benefits of outsourcing app development

Access to expertise and specialized talent

Outsourcing app development offers companies the opportunity to access a global market of specialized talent. This access is particularly useful for projects that require specific knowledge and skills that may not be available internally. Let’s detail the types of specialized talent a development agency can have, the technologies they might master, and the common development methodologies they employ.

Specialized talent

Development agencies have multidisciplinary teams that include a variety of roles, such as:

• Frontend and backend developers: Specialists in web and mobile technologies who ensure an optimal user experience and a robust backend.
• UI/UX designers: Professionals focused on creating attractive interfaces and intuitive user experiences.
• DevOps engineers: Experts in continuous integration and delivery (CI/CD), automation, and infrastructure maintenance.
• Security specialists: Professionals dedicated to ensuring application security through practices like penetration testing and security audits.
• Business analysts: Responsible for translating business requirements into detailed technical specifications. In certain sectors, such as healthcare, specific knowledge is required to be integrated into various phases of the project (design, development, compliance with sector-specific regulations and standards, etc.).

Technologies 

Development agencies are often well-versed in using advanced technologies, some of which include:

• Artificial intelligence (AI) and machine learning (ML): Implementation of predictive models, natural language processing (NLP), and recommendation algorithms to enhance the functionality and personalization of applications.
• Blockchain: Integration of blockchain technologies for applications that require advanced security features and transparency, such as financial transactions and data management.
• Augmented reality (AR) and virtual reality (VR): Development of immersive applications that offer interactive experiences in sectors like entertainment, healthcare, education, and retail.
• Internet of things (IoT): Creation of applications that interact with smart devices, providing innovative solutions in sectors such as healthcare, sports, wellness, smart homes, and automotive.
• Cross-platform development: Use of frameworks like React Native, Ionic, Flutter, or Xamarin to create applications that work on multiple platforms with a single codebase.

Development methodologies 

Development agencies adopt agile methodologies and project management practices to ensure efficiency and quality in app development. Some of the most common methodologies and practices include:

• Design thinking: Focused on a deep understanding of user needs and creating innovative solutions through an iterative process of empathizing, defining, ideating, prototyping, and testing. This ensures that the developed applications are intuitive and user-centered.
• Lean: This methodology focuses on maximizing customer value and minimizing waste. This means creating efficient processes that eliminate unnecessary tasks and optimize the use of resources, resulting in faster and more economical development.
• Agile: Utilizing agile principles to foster flexibility and responsiveness. Through incremental deliveries and continuous feedback, development can quickly adapt to changing requirements and ensure the final product meets customer needs.
• Scrum: One of the agile methodologies, where work is organized into short, manageable sprints, allowing for continuous delivery and constant product improvement through regular reviews and team feedback.
• Waterfall: Although less common in iterative projects, the waterfall methodology can be used for projects with clearly defined and stable requirements. This involves a sequential process where each phase must be completed before moving to the next, ensuring high quality and specification compliance from the outset.

Outsourcing app development to an agency means having a team of specialists who master cutting-edge technologies and apply effective development methodologies. This ensures that the app will be developed with best practices and the latest market trends, in addition to offering the flexibility and efficiency needed to quickly adapt to project changes and needs. With access to this level of expertise and specialization, companies can focus on their core competencies while trusting that their app development project is in expert hands.

High speed development

The use of agile methodologies and the experience of external teams allow for faster app development. Specialized agencies typically employ agile frameworks like Scrum and Kanban, facilitating continuous and efficient product delivery. This accelerates development time and enables quick adaptation to changes and feedback during the process, ensuring a high-quality final product.

Increased innovation capacity

Outsourcing provides access to new technologies and specialists in various fields. Outsourcing companies are often up-to-date with the latest technologies, such as artificial intelligence, machine learning, augmented reality, and blockchain. Access to these technologies and experts proficient in these areas can boost a company’s innovation capacity, allowing the development of more sophisticated and competitive applications in the market.

Cost reduction and control

Outsourcing app development can be much more cost-effective than maintaining an in-house development team. Costs associated with salaries, benefits, training, and infrastructure are eliminated. Additionally, companies can choose providers in regions with lower labor costs, further optimizing their budget. This model also allows for greater cost predictability, as outsourcing agreements usually include a fixed or milestone-based price.

Improved flexibility and scalability

Outsourcing offers superior flexibility and scalability, allowing companies to quickly adjust the size of the development team according to project needs. This is essential for projects with fluctuating workloads or specific skill requirements at certain times. Additionally, it facilitates the management of multiple projects simultaneously without the need to permanently hire more employees.

Faster time-to-market

Working with a specialized external provider can significantly speed up the development and launch of an app. Experienced development agencies can implement agile and efficient processes, reducing waiting times and increasing execution speed. This enables companies to reach the market more quickly, seizing opportunities and responding to market demands with greater agility.

Mitigation of legal and operational risks

Outsourcing app development also helps mitigate legal and operational risks. Professional service providers are familiar with industry regulations and standards, ensuring compliance with important regulations such as data protection and IT security. Moreover, by outsourcing, many operational risks, such as personnel management and infrastructure issues, are transferred to the provider, allowing the company to focus on its core business without additional concerns.

Focus on core business competencies

By outsourcing app development, companies can focus on their core competencies and strategic activities that drive business growth. Leaving app development in the hands of experts allows the company to dedicate more time and resources to innovation, customer service, and other fundamental areas, without the distraction of managing an internal development team.

In summary, outsourcing app development offers multiple benefits that can positively transform a company’s development strategy, allowing access to specialized talent, optimizing costs, improving flexibility, and accelerating time-to-market, all while mitigating operational and legal risks.

How to outsource app development

Define project requirements and goals

The first step in outsourcing app development is to have a clear vision of the project requirements and objectives. This includes defining the essential functionalities of the application, the target platform (iOS, Android, or both), the target audience, and any technical or design specifications. Additionally, it is crucial to establish clear and measurable project objectives, such as the launch timeline and the estimated budget. This initial preparation ensures that the service provider understands exactly what is needed and can offer a proposal aligned with your expectations.

Assess partner feasibility and capabilities

Evaluating the capabilities and feasibility of potential partners is crucial. Review their portfolios to see examples of previous work and projects similar to yours. Consult references and case studies to get an idea of their ability to deliver projects on time and within budget. It is also helpful to read reviews and testimonials from previous clients to assess overall satisfaction with their services. Additionally, consider the technology and methodologies they use, ensuring they align with your needs and expectations.

Seal partnership

Once the right partner has been selected, it is important to formalize the collaboration by signing detailed contracts. These contracts should include:

• Non-disclosure agreements (NDAs): To protect sensitive information and intellectual property.
• Post-launch terms: Define support and maintenance after the app launch.
• Payment terms and schedules: Establish a payment scheme based on milestones or deliverables. A clear and detailed contract helps prevent misunderstandings and ensures that both parties are aligned in terms of expectations and responsibilities.

Actively manage the project

Active project management is essential to ensure its success. Use project management tools like Jira, Trello, or Asana to keep track of tasks and project progress. Schedule regular meetings with the development team to review the project’s status, resolve issues, and make necessary adjustments. Constant and clear communication is key to keeping everyone involved aligned and ensuring that the project progresses as planned.

In summary, outsourcing app development requires careful planning and proactive management. Clearly defining project requirements, thoroughly evaluating potential partners, formalizing the collaboration with detailed contracts, and actively managing the project are essential steps to ensure the success of outsourced development.

Strategies to reduce risks when outsourcing app development

Outsourcing app development can bring numerous benefits, but it also involves certain risks. Implementing appropriate strategies to mitigate these risks is crucial to ensure the project’s success. Below are some effective strategies:

Conduct due diligence

Before committing to a provider, it is essential to perform thorough due diligence to assess the partner’s reputation and experience. This includes:

• Reviewing the provider’s portfolio: Examine past projects and success stories.
• Requesting profiles and CVs: Ask for profiles and resumes of the proposed workers for the project.
• Consulting references and feedback: Speak with previous clients to understand their experience.
• Evaluating financial stability and technical capacity: Ensure that the provider has the resources and infrastructure needed to handle the project.

Establish clear communication channels

Defining clear communication channels is fundamental for ensuring effective collaboration. This includes:

• Defining schedules and methods of communication: Set a meeting schedule and the tools to be used (e.g., Slack, Zoom, Trello).

• Creating a communication plan: Ensure that all parties know how and when to communicate, including the frequency of updates and progress reports.

• Follow-up plan: Define and establish a schedule for tracking project progress.

Sign contracts

A detailed contract is essential to protect the interests of both parties. This contract should include:

• Non-disclosure agreements (NDAs): To protect sensitive information and intellectual property.
• Payment terms: Specify payment conditions, including milestones and due dates.
• Intellectual property: Clearly define who owns the rights to the code and other developed products.

Implement a project management framework

Using agile methodologies like Scrum or Kanban can significantly improve project management. This involves:

• Dividing the project into sprints or iterations: To allow quick adjustments and continuous feedback.
• Using project management tools: Such as Jira or Asana, to maintain detailed tracking of progress and tasks.

Foster a partnership mindset

Creating a collaborative and trustful environment between the company and the provider is vital. This can be achieved by:

• Setting clear expectations: Ensure that both parties understand the goals and expectations from the project’s outset.
• Encouraging transparency: Share information openly and honestly about the project’s progress and challenges.
• Involving the provider in decision-making: Consider the provider a strategic partner, not just a task executor.

Establish a quality assurance and testing plan

Defining quality criteria and processes ensures that the final product meets desired standards. This includes:

• Setting quality metrics: Define which indicators will be used to measure development quality.
• Implementing continuous testing: Conduct regular tests throughout development to identify and correct issues early.
• Scheduling reviews and audits: Ensure that the final product has been reviewed and audited before launch.

Implementing these strategies can help minimize the risks associated with outsourcing app development, ensuring successful collaboration and a high-quality final product.

How much does it cost to outsource app development

Factors influencing the cost

The cost of outsourcing app development can vary significantly depending on several key factors:

• App complexity: More complex applications with multiple functionalities, API integrations, support for multiple platforms, and advanced features like artificial intelligence or augmented reality tend to be more expensive to develop. Conversely, apps with basic functionalities and a simple interface will have lower costs.
• Location of the team: The geographical location of the development team greatly influences the cost. For example, developers in North America and Western Europe typically have higher rates compared to developers in Asia or Eastern Europe. This factor is due to differences in the cost of living and wage rates in various regions.
• Technology used: The type of technology and development tools also affect the cost. For example, developing a native app for iOS or Android can be more expensive than opting for a cross-platform solution using frameworks like React Native or Flutter.

Cost estimation

The cost of outsourcing app development will depend on the hourly rates of the development team and the complexity of the app. To know the hourly cost based on the region where the agency is located, you can refer to the following article. Regarding the complexity of the app, it can be classified into four main categories: basic app, medium app, complex app, and custom app.

• Basic app: Applications with basic functionalities, such as a news reader or a simple calculator, usually require around 350 hours of development time. These projects generally require less time and resources to develop.
• Medium app: Applications with moderate features, such as GPS integration, user authentication, and push notifications, need between 350 and 500 hours of work. These projects are more complex and require a greater investment in time and resources.
• Complex app: Applications with advanced functionalities, such as integrations with external APIs that require synchronization, integration with external IoT devices, or payment gateway integrations, range between 500 and 800 hours. These projects require a highly specialized team and a longer development period.
• Custom app: If you want to have cutting-edge technologies, such as integration with custom algorithms or artificial intelligence (AI) services, as well as traceability functions using blockchain services, then a custom app is needed. These types of applications require more than 800 hours.

Pricing models

There are several pricing models that companies can use when outsourcing app development, each with its own advantages and disadvantages:

• Hourly rate: Here, the client pays for the time the development team dedicates to the project. It is a flexible model that allows for adjustments during development, but it can be difficult to predict the total cost if the project scope is not clearly defined from the start.
• Milestone-based: This model divides the project into several milestones, and payment is made upon the completion of each one. It combines elements of fixed-price and hourly models, offering a balance between flexibility and cost control. It is ideal for large projects that can benefit from a staged payment structure.

Outsourcing app development involves considering various cost-influencing factors and choosing the most suitable pricing model for your needs. By evaluating these aspects and planning appropriately, you can optimize your investment and ensure the success of your mobile app development project.

 Why choose GooApps as your app development partner

Effective communication strategies

At GooApps, we understand that clear and constant communication is key to the success of any development project. We use efficient communication channels and tools, such as Slack, to keep all parties informed and aligned. We establish regular communication schedules and clear methods for sharing updates, resolving issues, and making quick decisions. This ensures that our clients are always aware of progress and can provide continuous feedback, contributing to more agile and effective development.

Ensuring legal and security compliance

Compliance with regulations and security standards is a priority at GooApps. We ensure adherence to all relevant regulations, including GDPR (General Data Protection Regulation), LOPD-GDD (Organic Law on Data Protection and Guarantee of Digital Rights), MDR (Medical Device Regulation), and IVDR (In Vitro Diagnostic Medical Devices Regulation). This guarantees that our applications are secure and meet the highest legal standards, protecting both end users and our clients.

Agile development and project management

At GooApps, we use agile methodologies such as Scrum and Kanban to manage our development projects. These methodologies allow us to be flexible and adaptive, facilitating the continuous delivery of product increments and rapid adaptation to changes in project requirements. Our agile approach ensures efficient development, reducing delivery times and improving the quality of the final product.

Quality assurance and testing

Quality is fundamental at GooApps. We implement strict Quality Assurance (QA) standards and procedures to ensure that each developed application meets the highest quality levels. Our comprehensive testing process includes unit testing, integration testing, functional testing, and usability testing. Additionally, we conduct regular quality audits and code reviews to identify and correct any issues before launch.

Post-Launch warranty and maintenance

Our commitment to clients does not end with the application launch. We offer a post-launch warranty of 3 to 6 months with any app we develop, depending on the project’s complexity. Besides the warranty, we also provide maintenance services and regular updates to ensure that the application remains functional and relevant over time. This includes bug fixes, security enhancements, and updates to ensure compatibility with the latest versions of operating systems and devices.

App updates and upgrades

In an increasingly technological and constantly evolving environment, it is essential for applications to stay updated and adapted to new technologies and market needs. At GooApps, we work proactively to incorporate the latest technological innovations into our applications, ensuring that our clients are always in a position of technological leadership. We offer continuous update and enhancement services to keep applications competitive and aligned with market trends and demands.

Choosing GooApps as your app development partner guarantees a comprehensive and professional approach, focused on effective communication, legal and security compliance, and the use of agile methodologies for efficient and high-quality development. With our commitment to quality and post-launch support, we ensure that each application not only meets expectations but also remains relevant and functional over time.

In conclusion

Outsourcing mobile app development offers multiple benefits that can enhance a company’s technological strategy. Among the main benefits are access to specialized talent and new technologies, cost reduction and control, improved flexibility and scalability, and accelerated time-to-market. Additionally, outsourcing allows companies to focus on their core competencies and mitigate legal and operational risks through clear contracts and compliance with relevant regulations.

At GooApps, we are committed to providing high-quality development solutions through effective communication strategies, legal and security compliance, and the use of agile methodologies. Our comprehensive approach includes a rigorous Quality Assurance and testing process, post-launch warranty and continuous maintenance, and constant updates to ensure the relevance of applications in an ever-evolving technological market.

We invite you to consider GooApps as your trusted partner for app development. With our experience and dedication, we can help transform your vision into a successful, high-quality application that meets all your market expectations and needs. Schedule your appointment with us to discuss how we can collaborate and take your project to the next level.