GBCORP BLOG · IT SERVICES
Offshore Development Company or Fixed-Price Partner? The Full Ledger
Offshore development is sold on the hourly rate. The rate is real; so are the costs that do not appear on the invoice: management, rework, time zones and the app nobody owns when the contract ends. Here is the full ledger.
An offshore development company offers seats at a rate that looks unbeatable next to a local salary. For a business with its own product managers, architects and a long roadmap, the model works; that is what it was designed for. For a business that needs an app built, published and kept alive, the rate is the smallest number in the calculation.
The full ledger
| Cost line | Offshore seats | Fixed-price partner |
|---|---|---|
| Hourly rate | Low | Fixed price per release; the rate is irrelevant |
| Management | Yours: specs, reviews, priorities, daily | The partner's: scoping week, sprint reviews you attend |
| Rework | Paid by the hour, including the misunderstandings | Inside the fixed price |
| Time zones | Your evenings or their nights | One team across 17 countries; someone is awake |
| Ownership | Usually yours, check the contract | Yours from day one, in writing |
| After launch | A new contract, or nothing | Support plan with response times, or hand-over |
When offshore seats are right
A software company with a product team, a backlog measured in years, and the management to run remote engineers as if they were in the building. The seats then extend a capable team at a lower cost, and the company owns the outcome because it owns the direction.
When they are wrong
A business whose product is not software, which needs a working app and a few improvements a year. Without an in-house product owner, the seats build exactly what was written and nothing that was meant, the specification becomes the full-time job of someone who already has one, and the app arrives late, undocumented and unmaintained. The rate was low; the app was expensive.
The fixed-price alternative
GBCORP scopes the project in a week, quotes a fixed price for the first release, builds in two-week sprints on a live test build and puts the code, cloud project and store accounts in the client's name. The team spans 17 countries, so the work follows the sun without the client managing it. After launch, a support plan or a hand-over. The client pays for outcomes, not hours, and manages a relationship rather than a team.
Checklist before outsourcing anything
- Decide who on your side will own the product daily; if nobody, do not buy seats.
- Insist on ownership of code, cloud and accounts from day one.
- Ask for a fixed price for the first release, or at least a capped one.
- Ask how publishing to the stores and post-launch compliance are handled.
- Ask what happens to knowledge when a developer rotates off.
- Compare the twelve-month total, not the hourly rate.
The numbers to expect
With GBCORP: scoping in a week, a first release in eight to twelve weeks at a fixed price, releases priced before they start, a support plan at a known monthly figure. With offshore seats: a monthly cost per seat plus your own management time, and a delivery date that depends on how well the seats are directed. For most non-software businesses the second total is higher by year one.
A worked comparison
A distribution company needs an ordering app for its trade customers with a console for its own staff. Route one: two offshore seats for six months, managed by the operations manager in the evenings, with a specification written in the first month and revised in every month after. Route two: a scoping week with GBCORP, a fixed price for the first release, a usable app in ten weeks, and a support plan. The seat invoices are lower per month; the operations manager's six months are not on any invoice, and the app that arrives has no store listings, no documentation and no one to call when the store rejects the first update. Priced honestly over a year, route two costs less and delivers earlier.
Nearshore, dedicated teams and the middle ground
Nearshore seats reduce the time-zone cost and little else. A dedicated team from a good outsourcing company is closer to a partner, but the client is still the product owner and still carries the specification. The middle ground that works for most companies with a product but no engineering team is a fixed-price partner for releases plus a support plan for the steady state, with the client's own product owner deciding what comes next. GBCORP works this way, and its engineers stay on the account across releases, so the knowledge does not rotate off with a seat.
Questions to ask any outsourcing company
Who owns the code, and from when. Who publishes to the stores, and under whose accounts. What happens when a developer leaves the project. How the specification is managed, and by whom. What the total cost is if the first estimate is wrong by half, which it usually is. What support looks like after the contract, and what it costs. Whether they will tell you not to build something. The answers are more useful than the hourly rate, and a company that answers them plainly is worth more per hour than one that does not.
Questions we hear first
Is GBCORP offshore?
GBCORP is a global company operating in 17 countries; the client is not sending work away, it is hiring one accountable team.
Can GBCORP act as a dedicated team?
Yes, on a support plan with the same engineers across releases, for clients with steady workloads.
Can we mix: our product owner plus GBCORP engineering?
Yes. That is the most common arrangement for companies with a product but no engineering team.
Who owns the code?
You do, from the first commit.
Where to start
The GBCORP software development hub sets out the fixed-price model; the GBCORP Custom App Development product is the priced starting point. For the in-house version of the same comparison, read hire software developers or hire a team.
GBCORP operates across 17 countries on 4 continents through six pillars: AI & IT, Innovation, Sustainability, Infrastructure, Business Lounge, and EV's & Solutions.
