Outsourcing vs Hiring In-House: Cost and Efficiency Analysis

There is a bunch of benefits of outsourcing:

It is typically more cost-effective than hiring in-house;
You can save on recruiting costs or delegate this responsibility;
It is well-suited to project-based work;
You can tap into a diverse pool of talent and bring fresh perspectives to your team;
Flexibility. If you encounter an emergency or need to replace a developer, you can easily do so with an outsourcing vendor. This allows you to continue making progress on your project without interruption;
It allows you to focus on your core business, rather than on managing a team.

If you're not impressed by this list, let's count some numbers. On a separate note, we have already written an article covering why we prefer Flutter to any other mobile development technology. One of the key points was the cost-effectiveness of Flutter. We assume that this point is important to you as well, and we will use Flutter salaries as an example for our calculation.

	In-House	Staff Augmentation with Us
Hourly Rate	The median annual salary in the US is 130,000 USD or 62,500 EUR in Germany. We will take the minimum and assume that the hourly rate is 30 USD (though for the US is actually much higher)	The hourly rate depends on developer experience and location but on average it is 35 USD.
Holidays, Vacations, Sick Days Expenses	20-30 days per year or $4800-$7200	$0 (provided by WTF)
Equipment	$1500 per year	$0
Human Resources Hassle	recruiting team buildings people motivation organizational routine paperwork	We take care of everything
Human Resources Expenses	$5000 as a recruiting expense on average from $1500 to no limit for social perks and parties	$0
Management Work	If you are a manager, you clearly understand the amount of burden that should be in this cell. It’s hard to describe to anyone what to expect from management work. Things always happen and you need to resolve them.	In most cases, we still need your help. But we will do our best to make it less strenuous for you. For example: we can give a piece of advice on how you could organize the work progress to make it more efficient we can replace problematic developers
Time to Find a Talent	1-6 months in most cases	1-14 day
Laying off	Not as easy as a 14-day termination notice	14-day termination notice at any time
Actual Hourly Rate for Every Working Hour	Roughly 40 USD for the EU and 70 USD for the US, plus your additional efforts	35 USD

Conclusion

Based on the table we can conclude that outsourcing is often more cost-effective and effortless, as it allows companies to avoid the expenses and effort associated with hiring and managing staff. Additionally, outsourcing can make your team more flexible and provide access to a broader pool of talent and expertise, allowing companies to choose the best possible individuals or teams for the job. Finally, outsourcing can help to reduce the workload and improve efficiency, freeing you up to focus on other important tasks.