Outsource vs In-House Developer: A Guide for Australian Businesses

If your business needs software built or looked after, you have three main choices. Hire a developer, use a local developer or agency, or use an offshore team. Each can work. The right choice depends mostly on how much work you have and how clearly you can describe it.

We're a local developer, so we have a side in this. We've tried to be fair, and for some businesses the right answer isn't us.

The three options at a glance

Hiring an in-house developer

A mid-level developer in Brisbane costs roughly $110,000 to $150,000 a year in salary. Senior developers are around $150,000 to $200,000 or more. On top of that you pay super, leave, equipment and software, and possibly a recruiter's fee. A new developer also takes a few months to learn your systems.

Things people often miss:

• One developer is one person. If they leave, much of what they know leaves too.
• Someone has to manage them and check their work. That's hard if nobody in the business is technical.
• A solo developer in a non-tech business can feel isolated, which makes them harder to keep.

Hiring makes sense when you have full-time work year round and software is central to how you compete. At that point it usually works out cheaper than paying outside rates.

Using a local developer or agency

You pay for the work, not a salary. Projects are usually priced as a fixed quote, and smaller jobs by the hour. At Hireadev, consulting is $150 an hour, and larger projects start with a paid discovery and then a fixed quote.

The upsides: no recruiting and no ongoing salary, the same time zone, and in South East Queensland you can sit down together in person. That makes it a good fit for work that's still being figured out.

The downsides:

• The hourly rate is higher than an employee's pay per hour, and much higher than offshore rates.
• An outside developer won't know your business as deeply as a long-serving employee.
• A small business like ours has limited capacity. Ask any small provider how they handle holidays, illness and urgent problems.

Using an offshore team

Many Australian businesses use offshore developers well. Rates are usually much lower than local rates, and the best providers do excellent work. Quality varies a lot, so check providers carefully.

Offshore works best when the work is clearly written down before it starts, and someone on your side can review the work and the code. Time zones vary too. The Philippines is two hours behind Brisbane. Eastern Europe is most of a working day behind.

The risks to plan for:

• More of your time goes on explaining and checking, especially if requirements are loose.
• A big time difference means each question can take a day to answer.
• Code that nobody reviews can be hard for the next developer to pick up.
• Contracts matter. Make sure you own the code and can access it at any time.

Which option fits?

• Steady full-time work, and software is central to your business: hire in-house.
• A project with a clear end, then little work after: a local developer or agency on a fixed quote.
• Not sure yet what you need: someone you can sit down with, local or a senior in-house hire. Start with a short paid discovery.
• Clear, written requirements and someone to check the work: offshore can save money.
• A few hours a month: a local developer by the hour. It's hard to hire someone part time.

A common path is to use outside help for the first version, then hire in-house once there's enough ongoing work. Plan the handover from the start. Whoever builds it, including us, should leave you with documented code, accounts in your name and time to hand over.

For your IT person

A handover checklist to ask for, whichever option you choose:

• Source code in a repository your business owns, such as GitHub.
• Hosting accounts on Azure or AWS in your business's name.
• Written setup and deployment steps, and automated tests for the important parts.
• A list of every outside service the app uses, with logins in your password manager.
• A contract that assigns the code and intellectual property to your business.

Talk it through

See how we work on our custom software development page, or book a free 30-minute chat with Ryan. We'll tell you which option fits, even if it isn't us.