Freelancers Vs Agencies: What’s Best for Outsourcing Software Development?

Deciding to outsource software development projects to Freelancers or Agencies is sometimes a difficult choice. Let’s find out the pros and cons of outsourcing software development to each.

5 min read
Nov 15, 2021

Finally, you have decided to outsource your software development projects to a reliable outsourcing partner. However, finding the right and trustworthy outsourcing partner is like finding a needle in a haystack. Since the freelancers have taken over, it has become more difficult for organizations to choose between freelancers and agencies.

Deciding over which one’s best and right for you without understanding what each approach offers is like sitting in a rowboat without oars. There are certain considerations while outsourcing your software development projects that you’d have to take care of.

To help you decide what’s the best approach for your organization, the team at ashutec presents the pros and cons of outsourcing software development to freelancers and agencies.

Pros of Outsourcing to Freelancers

1. Freelancers are Cheaper

Economical reasons play the biggest factor while outsourcing software development. We all know that outsourcing is cost-effective and affordable than in-house development. As freelancers work independently, it is even more affordable and cheaper in comparison to the agencies offering similar development services.

2. Skill Specialists

Freelancers are individuals with specific skillsets. Oftentimes, small-scale projects require only professionals that hone the expertise and skills in one of the areas. In such situations, you can handpick the best out of all freelance professionals for the task. Agencies also do have experts in specific skillsets too. But it’s no guarantee that all the agencies will have the expert professionals your project demands.

3. They are Flexibility to Work With

You can hire freelancers whenever you want. They provide you with the flexibility to hire them for whatever number of hours you need on your project. Often they don’t have requirements such as minimum engagement level or long-term contracts to hire them. Further, you can hire multiple freelancers with different skillsets to carry out large software development projects.

Cons of Outsourcing to Freelancers

1. Unreliability

Freelancers work with multiple clients and on multiple projects at times. Oftentimes, you’ll find them juggling between different projects, which may delay your project’s deadline. This unreliability of project completion is why most organizations don’t consider outsourcing to freelancers.

Further, the overworking nature of the freelancers makes them rush project delivery with poor performance. Thus, you’ll often find yourself compromising on the performance front of your software project.

2. No Senior or Supervisor

As freelancers work independently, there’s no senior developer or supervisor to inspect the work or quality of the project. Additionally, it’s hard for you to make them understand your brand identity, expectations, and project deadlines. Thus, it becomes vital for you to have some level of oversight over your freelancers.

What this means is you’ll have to take time to communicate, review the work and quality standards, then offer your feedback and decide on project deadlines, which may increase your workload.

3. Too Tight Work Schedules

Freelance developers sometimes work on too tight schedules, thus managing them often feels like climbing a mountain. It takes a lot of effort from your side especially when you choose to work with multiple freelancers simultaneously. Many times, freelancers may not be available to work on your projects when you need them the most.

Pros of Software Outsourcing to Agencies

The major factor why software companies outsource to agencies is the reliability they get in return for their project’s completion. Thanks to this reliability, companies prefer to work with a well-established business rather than individuals. Let’s see other benefits of outsourcing software development to an agency:

1. Accountability and Less Oversight

Outsourcing to agencies is a more trustworthy choice and requires less oversight. They would never do such things like compromising on quality, performance, or not responding to your queries or even quitting projects midway that tarnishes their image and reputation. Furthermore, you won’t be as much invested in project management.

Agencies have professional project managers tasked to attend to each client’s requests and report development progress. They are responsible for streamlining the project communication and completing project milestones within deadlines.

2. They have a Good Track Record

Well-established agencies have experience and a great track record of working with many clients in past. They may have completed projects similar to your niche and have built an extensive portfolio, case studies, testimonials, and reviews.

Further, agencies want to retain their clients and form long-term relationships to sustain their workload rather than keep finding new clients as in the case of freelancers. To form a long-term relationship, they’ll work to prove their worth over and over, again and again.

3. Streamlined Project Management

As opposed to freelancers, agencies have specialized teams and departments to take care of your project requirements and keep it on track. They are better at project management, especially the larger ones because of the large team size than an individual freelancer.

Moreover, the specialized team of agencies can organize the workflow for you and offer access to enterprise resources. Thus, large projects with high complexity levels are better handled by agencies.

Cons of Outsourcing to Agencies

Hiring agencies have certain drawbacks as well. Let’s have a look at them:

1. Expensive Than Freelancers

As mentioned, freelancers are cheaper than outsourcing to agencies because of the overhead fees and taxes agencies charge. Also, salary payouts to professionals and non-billable people to account for factor-in to make outsourcing to agencies more expensive than freelancers. Such factors create a vast difference in the per-project and hourly rates of agencies and freelancers.

Even though agencies are expensive than freelancers, outsourcing to agencies in countries like India is still a cost-effective option and saves a significant amount on your software development.

2. Communication Delays

You are not only outsourcing to an agency but the whole corporate administration. They have multiple people involved in a project, which is oftentimes great but leads to communication delays. Many agencies allocate a project manager or account manager to handle all the communication with the clients.

But sometimes such a single point of contact may lead to communication delays as passing on the client requests depends only on them. To overcome this communication gap, many agencies allow direct access to resources working and delivering the project.

Freelancers Vs Agencies: Who’s the Winner?

While freelancers are the cheapest option to outsource your software development project, they are not as reliable as outsourcing to a well-established agency like ashutec. Freelancers are more trusted for small-scale, short-term projects to outsource, which many big agencies wouldn’t consider and be interested in.

However, large, complex, and long-term projects require multiple hands of experts such as designers, developers, QAs, writers, etc., which agencies can easily fulfill. They can deploy multiple skillsets required on a project for which freelancers are incompatible. Thus, agencies are the right choice to outsource your large-scale, complex software and product development projects.

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