Outsourcing is a strategic decision that many companies consider when balancing the needs of their eCommerce operations. In the eCommerce industry, there are typically two primary forms of employment: in-house team and outsourcing. Companies often balance between these two approaches, and understanding the advantages and disadvantages of both is crucial for developing an effective team-building strategy. When it comes to the eCommerce industry, there are two main scenarios in which outsourcing a developer comes into play.

The first one is an eCommerce implementation agency looking for developers to work on projects for their acquired clients.

The second one, in turn, is an eCommerce business that is either building or expanding its team, undergoing digital transformation, and needs developers to either develop or maintain its eCommerce project. Understanding the pros and cons of outsourcing in these contexts is essential for making informed decisions regarding outsourcing in eCommerce development.

Quick jump

Outsourcing a developer for an eCommerce agency

Let’s begin with the case of an eCommerce implementation agency. In this scenario, the key consideration is the hourly pay rate for the developer’s work, as it determines whether outsourcing is more cost-effective than hiring an in-house developer. Regardless of the developer’s skills and potential advantages, the agency will not agree to outsourcing if the pay rate does not meet their requirements.

Another obstacle may be some companies’ reluctance to collaborate within a white-label model, where the outsourced developer is presented to the client as an internal employee of the company. Additionally, some agencies may be restricted by existing partnership agreements, preventing them from outsourcing developers and assigning them to projects.

Developers are often the most valuable sales asset for an agency, and skilled personnel are their greatest investment. Therefore, agencies prefer to hire people directly, allowing them to train employees according to their own methods and later benefit from having an in-house development team.

Nonetheless, outsourcing a developer offers significant advantages, enabling beneficial collaboration between agencies that can lead to substantial cost savings, access to specialized expertise, and enhanced project scalability. This approach allows companies to bring in additional support exactly when needed, especially for short-term projects. Furthermore, outsourcing often presents a financially attractive option, as the hourly rates for the client may be more favorable than those offered by in-house teams. Additionally, outsourcing provides an effective solution for accessing highly qualified professionals with specific technological expertise, especially in cases where finding such talent in-house may be challenging. Last but not least, the potential benefit of outsourcing is the tax advantages it can offer, making it an even more appealing option. Taking this into consideration, it’s possible that the overall cost of outsourcing may turn out to be lower, even when higher hourly rates are involved.

Now, let’s take a look at the idea of outsourcing developers to eCommerce businesses.

Outsourcing a developer for an eCommerce business

Apart from eCommerce agencies, skilled developers can also cooperate directly with eCommerce businesses. Online companies may look for additional support in situations when:

  • They need resources to maintain their IT infrastructure
  • They want to build a team that will be responsible for the development and maintenance of the online store
  • They want to build internal competence to develop the store by themselves

Every eCommerce business case is different; however, outsourcing a developer to an online business can offer more benefits than outsourcing to an agency.

Similar to eCommerce agencies, when a company operates an eCommerce platform using a specific technology and is looking for a qualified specialist in that area, it can be very difficult to hire a highly skilled developer. In such cases, outsourcing provides greater opportunities to work with such talented individuals.

What are the general benefits of outsourcing developers?

Speaking of the benefits of outsourcing eCommerce, here is the list of potential benefits why many online retailers turn to eCommerce outsourcing companies. Outsourcing can provide significant advantages that go beyond just cost savings, offering companies access to specialized skills and flexibility in scaling their teams. Let’s take a look:

Cost Savings on Employment-Related Expenses

Although you may pay a higher hourly rate for a developer, outsourcing allows you to avoid costs associated with onboarding, training, employee vacations, and sick leave. Also, outsourcing eliminates recruitment costs and speeds up the process of bringing in the right person. This can be especially useful when you need someone to start immediately.

In some countries, you can also achieve tax benefits because you don’t have to pay additional fees and taxes associated with hiring an employee under a traditional employment contract. As a result, despite the higher hourly rate, outsourcing can sometimes lead to a lower total cost of ownership (TCO).

Access to Specialized Expertise

Outsourcing enables you to focus on hiring a specialist in a specific technology. Similar to market candidates, the onboarding process for outsourced individuals is faster, and they can work more efficiently due to their experience. This is especially beneficial in cases where expertise is crucial, such as when working with specific technologies like Sylius, where an outsourced developer can work up to twice as efficiently as a less experienced developer.

Shared Knowledge from the Outsourcing Agency

What’s more, when you outsource from a qualified agency, you gain access not only to the hired individual but also to the collective knowledge of the entire agency. If a significant decision about architecture or a difficult problem arises, the outsourced developer can consult with colleagues within their agency, potentially resolving issues more efficiently. This is particularly advantageous if the developer has experience in the same industry as the project.

Access to Additional Resources

Signing an agreement to outsource a single specialist often gives you access to other experts within the agency. If your project suddenly requires additional resources, such as a QA, designer, project manager, or frontend developer, you can usually integrate them into the project easily. This flexibility is especially valuable for eCommerce companies that may need temporary support in specific areas.

Flexibility in project duration

A significant advantage for agencies is the flexibility to engage with a developer only for the duration of a specific project, such as a 4-month assignment, without a long-term commitment. For eCommerce companies, this flexibility allows them to bring in experienced developers for critical tasks or to quickly launch new functionalities.

White-label collaboration

Outsourced developers can participate in projects under a white-label model, where they are presented as the client’s employees during external meetings. Often, collaboration with outsourced developers mirrors in-house employment, including participation in internal meetings, daily communication with the team, and sometimes even travel for in-person meetings.

Enhanced value and knowledge transfer

By outsourcing specialists in specific technologies, agencies can offer additional value to their clients and leverage the expertise of the outsourcing agency. For example, an agency may work with Sylius and Symfony while also implementing PIMs and headless frontends by utilizing the experience of the developers they outsource. This collaboration also allows less experienced developers to learn from their outsourced counterparts, improving the agency’s overall capabilities.

Vendor relationships and support

If you are working on a project with a specific technology vendor, the agency from which you outsource may have strong relationships with that vendor. This can lead to better deals, enhanced support on the project, and other advantages.eCommerce companies with good relationships with vendors can often benefit from this partnership and support each other. 

Scalability of the team

Outsourcing allows for easy scalability of the team based on project needs. During tight deadlines, you can quickly add more developers to meet deadlines and deliver the required functionalities. Conversely, when work volume decreases, you can scale down the team as needed.


Check our outsourcing ecommerce projects:

Infolox
Foodspring

The potential drawbacks of outsourcing eCommerce web development

As mentioned earlier, outsourcing may not always be financially viable, depending on the company’s goals. In the long run, in-house employment can be more cost-effective. Here are some key drawbacks:

  • Higher cost per specialist hour: When outsourcing, you will always pay more per hour compared to direct employment because the agency providing the specialist also needs to make a profit. If the higher hourly cost is not offset by other business factors—such as HR and recruitment costs, the difficulty of finding specialists, taxes, employee benefits, skills, etc.—outsourcing will be less advantageous than direct employment.
  • Dependence on outsourcing company: You are bound by a contract with another company and the terms of cooperation, which can be a risk factor for the organization outsourcing the developers.
  • Lack of internal competency building: With outsourcing, the organization does not build internal skills and does not reap the full benefits associated with having in-house expertise.

Summary

Outsourcing developers for an eCommerce agency or online business is a decision that depends heavily on the specific circumstances of the project. Nonetheless, it may bring a lot of benefits and speed up the work on projects and specific tasks.

One of the most critical factors in outsourcing is the developer’s expertise, especially when working with specialized platforms like Sylius. In such cases, ecommerce outsourcing services can be a perfect solution for a project due to the quality of their work and deep knowledge of the platform.

The decision to outsource should be based on a detailed analysis of your project’s needs, the developer’s skills, and the long-term value they bring to your business. Outsourcing can be a strategic move that not only addresses immediate project needs but also positions your business for future growth and scalability while establishing new partnerships with eCommerce developers and agencies.

If you are looking for an outsourcing partner, contact us! We offer ecommerce development services and specialize in technologies such as Sylius, Shopware, Symfony, Pimcore, Sulu CMS, Ergonode and Akeneo.

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