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Latin American Software Outsourcing


Latin American software outsourcing has come a long way. According to a recent report by Thomson Reuters, Latin America received more than $11 billion in venture capital and private equity investments in 2017. Due to the improved communication compared to other parts of the world, there are a few reasons why outsourcing to Latin American countries has increased in popularity.

What Makes Latin America so Attractive

Many businesses who are the beneficiaries of the massive investment is small and medium enterprises, are in Colombia and Mexico. With a lot of investments in these two countries, many increasingly becoming more comfortable with outsourcing their software needs to Latin America. Given that they are in close proximity to the US market, these countries can compete with the likes of China and India, which offer cheap labor and raw material but lack proximity.

In recent times, Latin American universities have set up strong IT programs that have produced enough programmers that can fulfill software outsourcing needs. Even though outsourcing from Latin America is more expensive compared to China or India, it is cheaper than doing the same with an American based team. Collaboration with your Latin American team will always be easier due to the being in the same time zones that make collaborative software development possible.

Overall, Latin American companies provide the following advantages over US outsourcing:

Close proximity – Latin America is closer to North America than other outsourcing destinations in South East Asia and China and hence traveling for consultations with development team is easier and more convenient

Cultural Similarities – Most of the countries in Latin America have cultural similarities with their North American counterparts and have good English language skills as compared to their counterparts in the East

Time Zone Overlap – It is easy to collaborate with your team in Latin America as there are several hours of overlap with US workdays.

Outsourcing to Mexico

Because Mexico is so close to the US, it is considered “near-shore.” It’s proximity allows Mexico to be on the same time-zones as the US too which leads to better communication. Mexico has also seen an increase of STEM graduates. The retention rates are high in Mexico, too, so you’re likely to work with the same developer throughout the project. There are also similar cultural similarities between Mexico and the US.

Outsourcing to Peru, Colombia, and Argentina

Outsourcing to Argentina

Argentina is one of the most westernized countries in Latin America with a strong connection to its European roots. Combined with its large and talented pool of well-educated and tech-savvy programmers, it is the technological hub for most of the design and implementation focused internet start-ups in Latin America. Argentina has high cultural similarity to the United States, which makes Argentinian programmers some of the easiest to work with.

Outsourcing to Colombia

Colombia is part of the CIVETS (Colombia, Indonesia, Vietnam, Egypt, Turkey, and South Africa) which are known for having geo-strategic locations, ever rising FDI, a variety of exports, an increasing population of young people, controlled inflation and sophisticated financial systems. Of all the CIVETS, Colombia is one of the best for American outsourcing needs. This is because it has a similar time zone, is geographically close to the States and a westernized culture.

Colombia has a sizable software development workforce, and adds about 13,000 technical and engineering professionals to the work pool every year. Most Colombian professionals are well verse with development and technological processes such as CMMI and Agile. The country has some of the best telecommunications and electrical infrastructure and to add to that, English is widely used. Not surprisingly, these have attracted many multinational corporations such as Unisys, HP, and IBM, all keen to take advantage of their booming BPO and IT industries.

Outsourcing to Peru

Peru offers stability, with a growing economy that has made it a favorite investment destination. The country is a center for video game and animation services, graphics services, publishing, BPO, architecture, digital marketing, and software. With a booming economy, Peru is one of the biggest recipients of FDI in Latin America. Peruvian universities churn out bright technical engineers proficient in mobile and web applications, fluent in English and familiar with the mindset and business culture of the United States.

Bottom Line

Latin American software outsourcing is among the best in the world. Unlike other outsourcing destinations in the world such South East Asia, South America has the advantage of similar cultures with the US, a closer time zone, and close proximity. All of which make outsourcing with Latin American countries easier.

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